A fine example of Corporate Social Responsibility?
Post date: 23-May-2016 15:43:51
Today, in the news it was announced that AXA would be “divesting” their interests in tobacco companies, a level of involvement that has been headlined at $2bn. AXA have said that the “economic cost [of smoking] is huge” and that “insurers are part of the solution when it comes to health prevention” and it should be commended that such a large investor is keen to withdraw from this type of financial relationship.
It did, however, make me swear at the radio when I heard the news as I couldn’t believe that it has taken this long for them to get to this point. The health implications of smoking were first documented 65 years ago by the pioneering work of Doll and Hill and since then we have seen many landmark actions such as the banning of smoking in public places and legislation on cigarette packaging, just last week saw new rules in the UK forcing tobacco companies to sell their products in green packaging.
The financial cost-benefit of smoking to the national purse is difficult to pin down although many have tried. Without further investigating the precise details of AXA’s investments and costs, I'm pretty sure that they have not held on to these investments for so long if it wasn’t a net gain for them financially and for a company that takes money from members for both health insurance and life insurance I imagine the net benefit of more people dying early has not been a catastrophic financial burden for them over the years.
Having a light shone on this relationship between insurers and the tobacco industry also makes me wonder how the combined lobbying forces of these two sectors may have worked over the years in influencing the strength and timing of potential legislation aimed at reducing levels of smoking and the negative influence on the bottom line that these legislations have posed. The history of the public health battle against the tobacco industry is littered with complex inter-relationships between vested interests, lobby groups and governments and relationships such as this may well have had more influence than we would want to think.
“Axato ditch tobacco investments worth $2 billion because they ‘make no sense’” The Independent, 23/5/16
“AXA’s decision to quit tobacco is not as pure as it looks” FT.com, 23/5/16