At present, companies that are listed on the New York Stock Exchange or NASDAQ (“listed companies”) that sell tobacco-related products to consumers are not required to report the amount of revenue that they generate from those products. As a result, investors in those companies are unable to quantify their exposure to tobacco-related revenues.

Understanding tobacco-related revenues is important to manage investment risks and ensure investments are aligned with investor values. Without this data, shareholders in retailers could unintentionally have more exposure to tobacco products than what aligns with their values. Further, disclosure of tobacco-related revenues is important to understand the risks of declining sales of tobacco products.

For example, when CVS Health Corp. stopped selling tobacco products in 2014, it announced that those products accounted for approximately $2Bn in revenue, which Pella Funds Management (Pella) calculates represented 4.5% of the company’s total earnings at the time. Those sorts of numbers would be meaningful for investors wanting to assess how their investments stack up (1) relative to their value-systems and (2) from a financial risk/reward perspective. However, the data is not currently available for other retailers.

Pella is seeking support for its petition to USA’s Securities and Exchange Commission (SEC) to develop rules that require retailers of tobacco-products to disclosure their revenue from those products. Without these rules, retailers will continue to avoid making the disclosure because voluntarily reporting means they would be disclosing more than their peers, potentially putting them at a competitive disadvantage. Whereas, with the disclosure, investors would be able to make more informed decisions, limiting their risk and ensuring alignment with their values system, while not putting retailers at a competitive disadvantage.

This is a rare win-win situation and the time to act is now.