“[KLP] is not only about what gives the best return of investment, but also whether our investments contribute positively and sustainably from a social point of view.” – Sverre Thornes, CEO of KLP, In the official press release about the decision to cut out Gambling, Alcohol and Pornography from their investment portfolio.
Ethical investment has been a thing for some time now, where investment-companies gives themselves a possible handicap in exchange for plus points in conscience, opting to invest in practices that is easier to defend instead of more sketchy alternatives.
This is something I’m all for and is an important component for whenever the world decides to go into a more free market direction. A direction where the market self-regulates instead of leaning on state-regulations. Consumers taking their own consumption seriously and realizing the power of positively rewarding good behavior actually is. No producer of anything can survive without monetary feedback.
I’m just not entirely sure about the “immorality” in this case though…
Around 40 companies that produce alcohol and about 50 that is involved in betting/gambling got some bad news this Monday – Norway’s largest pension fund, KLP, sold out their investments in them. Big names like Carlsberg, William Hill, Bettson and Monët got affected by this decision according to The Local.
The Fund also decided to update its purchase policy to state that no future investments would be done in companies associated with production of pornography (which, to my knowledge, they never done any investments in).
The press release got published with 3 pdf files, in Norwegian, outlining why KLP decided against these three different categories.
In the case of alcohol there is a lot of scientific data cited and the effects the relatively high consumption of alcohol in Norway has on society overall and its a document full of cherry picking. My favorite part of the alcohol-pdf was the comparison between narcotics and alcohol, where drugs was declared less hurtful for society overall – Which is a strange comparison to begin with (comparing a legal to illegal substances has plenty of logical problems), but makes sense if you want to pad out your document with virtue signals in order to get any potential reader over to your side.
Yes, alcohol is problematic in Norway, but for a different reason. Socialized healthcare makes everyone bear the cost, involuntarily, of someone else’s drinking problem. The natural punishment in the drinkers personal pocket book doesn’t exist. Excessive drinking is very costly at the cocktail bar, but pales in comparison to the hospital bill. A bill that you won’t see since its hidden in the governments bureaucratic machine. Which is convenient for anyone enjoying too much nectar and spirits, not so much for everyone else. In this case, Vices are in fact crimes against the public. (Vices are not Crimes, an excellent book by Lysander Spooner talks about a totally different setting. Read it for free over at Ludwig Von Mises Institutes homepage).
My personal investment portfolio will have no alcohol-company restrictions of it, I just don’t see it as a “bad thing” – Alcohol can only be bad when people abuse it, instead of responsibly enjoy it, and that is a choice, an error. I would like to see more interesting spirits and choose to put my money where my mouth is in this regard. If some alcohol company would do something bad I’d pull my investment, but alcohol itself isn’t bad or unethical.
“Money games can for many be a pleasant recreation and something they enjoy. Unfortunately, some are having serious problems due to gambling addiction. Often this does not only affect the gambler, but also the family and especially children” – Quote from KLP’s Pengespill Kriterie, rough translation is mine
The anti-gambling stance is pretty much the same from KLP as the alcohol one. The Norwegian Oil Fund got critique for investing in casinos abroad which was seen as a business only for white-washing money for criminals (which I have no idea if it is or not, but I’m indifferent to if it is). In a similar vein KLP choose to opt out of the gambling-industry because its an unregulated market according to themselves- Which it clearly isn’t.
Heck, Norway itself has a state-enforced monopoly on gambling and has banned any foreign gambling companies to set up shop or target Norwegian citizens with ads. For some time Norwegian banks was forbidden by law to connect its clients with betting and gambling companies abroad. Something that’s been dropped since it was useless in these digital times of virtual visa-cards, crypto currencies and other ways to dodge the ban, rendering the law practically useless. I re-opened my Betsson account this past soccer world championship and was surprised when I didn’t need to jump through a couple of hoops to insert funds. Not entirely sure what changes the law-makers did, but it saved me a solid 5 minutes of fiddling around so I’m happy.
I believe dropping out of established and seriously run gambling-companies is quite strange if you want to lessen the impact of gambling-addiction. I’d much rather promote these kinds of companies over the alternative (which I guess is ran by and funds shady characters), especially since its easier to put pressure on a board of directors to do what you find acceptable in the forms of self-regulatory practices to prevent gambling-addiction. At least easier than finding and lecturing the local Henry Henchman and his boss on the virtues of not accepting money from a person with financial problems.
The same logic can be applied to the pornography industry: If you want to counter the sex-trafficking and other evil practices, isn’t it ideal to show the market that you are willing to invest in companies that doesn’t do bad stuff under the table?
I see it as counter-productive to the cause overall to not leave that door open. But, that might just be me?
~ Alex Utopium. Tweet with me!