Saturday, July 02, 2011

CofE gets tough on supermarkets profiting from cheap booze

The Church of England is to pull investment from supermarkets that fail to meet its standards on the responsible sale of alcohol.

Supermarkets and other retailers that derive five per cent or more of their revenue from the sale of alcohol could be excluded under its new ethical investment policy.

Together, the Church Commissioners, the Church of England Pensions Board and the CBF Church of England Funds hold assets of more than £8 billion.

The restrictions in relation to alcohol have been introduced following advice from the Church’s Ethical Investment Advisory Group (EIAG).

The EIAG said it was concerned about the "continuing negative health and social consequences" of the misuse of alcohol.

It is the first time that supermarkets have fallen under the scope of the Church of England's ethical investment policy on alcohol.

The EIAG said it was wrong to bar investment in alcohol producers while ignoring the mass retail of low-cost alcohol by supermarkets.

Supermarkets have been acused of fuelling Britain's binge drinking problem by offering cut-price alcohol deals.

John Reynolds, Chair of the EIAG, said: “The EIAG is concerned about corporate complicity in the misuse of alcohol, including through inappropriate pricing and promotions.

"Institutional investors don’t talk to the supermarkets about this and our old policy had no teeth because we couldn’t divest from a supermarket.

"We want to use our influence as shareholders to bear down hard on poor corporate practice and to encourage good practice.”

The EIAG said it would "engage" with retailers that fail to meet the minimum standards on responsible sales before imposing the ultimate sanction of exclusion from investment.

The new policy will be implemented in partnership with CCLA, the leading manager of UK church and charity investments, which is adopting a similar approach for several of the church and charity funds it manages after similar concerns were raised by clients.

The EIAG expects to make its first recommendations on which companies to exclude from investment under the new policy in 2013.

Until the EIAG makes new recommendations, the old exclusions of companies deriving more than 25 per cent of revenues from alcohol will continue to be applied by the National Investing Bodies.