Calif. pension system reconsiders tobacco divestment

Calif. pension system reconsiders tobacco divestment

Anti-smoking activists are stepping up pressure on the California Public Employees’ Retirement System (CalPERS) board to drop its plans to consider re-investing funds in tobacco stocks.

CalPERS, the biggest public pension system in the United States, sold all of its tobacco stocks around 15 years ago. But, now it is considering a plan to start re-investing funds in tobacco stocks.

But, a number of anti-smoking groups have severely criticized the state pension system’s move. The American Heart Association (AMA), the American Cancer Society (ACS) and the American Lung Association (ALA) have argued that any investment in tobacco stocks would send the message that the state supports the tobacco industry.

In a letter to the CalPERS’ board chairman, the groups said, “It is simple: investing in Big Tobacco may bring in some additional funds, but at what cost? California will end up paying much more, physically and financially.”

Jim Knox, the vice president of state government affairs for the Cancer Society’s advocacy arm, also criticized the plan. The groups said they would continue to lobby CalPERS board members as well as encourage pension beneficiaries to force the agency to drop its controversial plan.

CalPERS board members are scheduled to meet next week to decide how to advance with the plan, but a final decision can take up to two years.