Frequently asked questions

1. What is Tobacco Free Funds?

Tobacco Free Funds is a search platform that enables you to find out if your savings are being used to fund companies that produce tobacco products or promote tobacco to kids. We also help you find investment options that support a cleaner and healthier future.

Tobacco is the #1 cause of preventable death in the U.S., causing half a million deaths a year in the U.S. alone. Tobacco use is increasing globally, particularly in the developing world. One billion lives are at stake in the battle against tobacco addiction this century. Download Acrobat Reader to view this PDF The World Health Organization describes tobacco as the most devastating, but preventable, epidemic of our time.

Click to here to see a list of funds that avoid tobacco investments.

2. What do entertainment companies have to do with tobacco?

There is scientific consensus that exposure to tobacco in movies causes kid to begin smoking. Learn about the history, research, and company analysis below.

The History

The U.S. and other countries have long tried to halt tobacco promotion to children and adolescents. In 1971, Congress banned tobacco commercials on radio and television. In the 1980s and 1990s, restrictions were negotiated on tobacco advertising in print media and on billboards. Yet depictions of smoking continue in movies and on television. The scientific consensus is that tobacco imagery causes kids to begin smoking.

The history of collaboration between the film and tobacco industries is well-documented, including by the U.S. Surgeon General. From the late 1920s to at least the mid-1990s, tobacco companies paid millions of dollars to place their products in entertainment media accessible to kids. These cross-promotion and product placement deals were in addition to the millions in advertising dollars that tobacco companies paid to the major studios' television production arms and to broadcast networks.

The historic 1998 legal settlement with state Attorneys General (the “Master Settlement Agreement”) barred tobacco companies from paying to place their brands in U.S. movies and TV shows accessible to children and adolescents. Over the past decade, 180 nations and other territories have become parties to the World Health Organization Framework Convention on Tobacco Control (FCTC) Article 13, which commits countries to eliminating tobacco promotion on all media platforms, including film. The United States signed but did not ratify this treaty. No U.S. law or regulation currently bars tobacco product placement in media accessible to children and adolescents. And the Master Settlement Agreement with U.S. tobacco firms does not prevent any film or television producer or distributor in the U.S. from making a promotional deal with a multinational tobacco company or its agents.

The Research

In 2012, the U.S. Surgeon General reviewed extensive scientific literature and concluded that exposure to smoking on screen causes kids to smoke. This seminal report concluded that an R-rating for future movies with smoking would lower teen smoking rates by 18 percent and prevent one million tobacco deaths among kids alive today.

In July 2017, CDC’s Morbidity and Mortality Weekly Report (MMWR) noted that “the steady decline in the number of tobacco incidents in youth-rated movies from 2005–2010 stopped after 2010” and re-affirmed the necessity for R-rating movies with smoking. The CDC report, covered in The New York Times, credited investors with helping to reduce tobacco imagery in kid-rated movies.

However, the Motion Picture Association of America, the trade group for the major studios that governs the U.S. movie rating system, has repeatedly refused to adopt the R-rating for smoking.

In August 2017, 17 leading U.S. health organizations (including American Cancer Society and medical organizations representing more than 630,000 doctors) demanded that movie producers, distributors and exhibitors apply an R rating to all films that include depictions of smoking or tobacco.

The definition of a “Tobacco Free” entertainment company
  1. Stipulates in its distribution and licensing agreements that exhibition of any film with tobacco imagery will be preceded by a strong anti-tobacco spot announcement, in all media and in all distribution territories;
  2. Requires each credited producer of a film with tobacco imagery to file affidavits stating that nobody associated with the film production entered into any agreement in regard to the representation of tobacco in the film;
  3. Stipulates in all production agreements that the finished film shall not include any tobacco product brand or facsimile;
  4. Stipulates in all production agreements that there should be no tobacco imagery in any film conceived to be youth-rated, with the possible exception of a film that depicts tobacco use only by an actual historical person (as in a documentary or a biographical drama) or accurately portrays the serious health consequences of tobacco use.
  5. Further, that the company (if it is an MPAA member), in its role on the governing board of the Motion Picture Association of America, explicitly supports updating the rating and advertising standards and guidelines to assign an R-rating to any film with tobacco imagery, with the possible exceptions stated at (d).
Who is responsible?

Tobacco Free Funds identifies six equities that own major (MPAA-member) movie studios:

  • 21st Century Fox (Twentieth Century Fox)
  • Comcast (Universal, Focus)
  • Disney (Disney, Marvel, Lucasfilm, Pixar, Touchstone)
  • Sony (Sony Pictures, Columbia, Screen Gems)
  • Time Warner (Warner Bros., New Line)
  • Viacom (Paramount)

In addition, Tobacco Free Funds identifies four equities that own large non-MPAA member studios:

  • AMC Entertainment (jointly owns Open Road)
  • CBS (CBS Films)
  • Lions Gate Entertainment (Lionsgate)
  • Regal Entertainment Group (jointly owns Open Road)

Tobacco Free Funds screens could be extended to other industries if scientific research finds that these companies are responsible for recruiting new smokers. When data collection is in place, Tobacco Free Funds may include:

  • Subscription Video On Demand (SVOD) companies such as Amazon, Apple, Google and Netflix, whose original productions may feature tobacco imagery and which lack appropriate notifications and safeguards at product selection or point-of-purchase for third-party entertainment products with tobacco imagery.
  • Cable and satellite companies such as AT&T, Charter and Comcast without appropriate notifications and safeguards at product selection or point-of-purchase.
  • Film exhibitors and video retailers such as AMC, Cinemark, Regal, Amazon, Apple, Best Buy, Redbox, Target, and Walmart (Vudu) without appropriate notifications and safeguards at point-of-purchase of entertainment products with tobacco imagery.
3. How do entertainment companies compare?

None of the major movie studios are “Tobacco Free”, but Disney has made significant progress.

Ten publicly-traded parent companies own movie studios:

  • 21st Century Fox (Twentieth Century Fox)
  • AMC Entertainment (jointly owns Open Road)
  • CBS (CBS Films)
  • Comcast (Universal, Focus)
  • Disney (Disney, Lucasfilm, Marvel, Pixar, Touchstone)
  • Lions Gate Entertainment (Lionsgate)
  • Regal Entertainment Group (jointly owns Open Road)
  • Sony (Sony, Columbia, Screen Gems)
  • Time Warner (Warner Bros., New Line)
  • Viacom (Paramount)
Disney leads the industry in reducing tobacco impressions

Disney strengthened its tobacco policy in 2015 to “prohibit smoking in movies across the board [in] Marvel, Lucas, Pixar [and] Disney films.” Disney’s policy still allows smoking in movies distributed under its Touchstone label, most recently used to market DreamWorks productions. In 2016, only one out of 13 youth-rated films released by Disney included tobacco imagery.

By 2013, all major movie studios or their parent companies had adopted tobacco depiction policies that may discourage but do not eliminate smoking in their youth-rated movies (see chart below). Sizeable loopholes in these policies, such as allowing smoking for “creative” reasons, have prevented smoking incidents in PG-13 films industry-wide from falling since 2010. In 2016, more than one in three PG-13 movies from MPAA-member studios still featured smoking.

Other studios lag far behind Disney

Among the major studios, Sony ranks as the smokiest: 44 percent of Sony’s youth-rated movies from 2013 to 2016 feature smoking. Lionsgate follows with 41 percent of youth-rated movies showing tobacco use. By comparison, Disney and Disney owned labels showed tobacco use in 12% of their movies over the past five years. All other studios (Universal, Fox, Paramount, and Warner Bros.) had between 28-38% of movies with tobacco use — at least double that of Disney.

Comparison of studios by smoking policy

Adapted from Smokefree Movies, University of California, San Francisco

CompanyPolicy dateSubjective exceptionsYouth-rated films w/ smoking
Comcast (Universal)2007"importance [from a] factual or creative standpoint...difficulty in removing it"30% (14/46)
Disney2007, 2012, 2015 Download Acrobat Reader to view this PDFDoes not include movies purchased for distribution under the Touchstone label12% (5/42)
Fox2012"historical, biographical or cultural context... important...from a factual or creative standpoint"29% (14/49)
Sony2012"important tie to the creative context of the project or the creative vision of the filmmaker"44% (19/43)
Time Warner2005, 2007"compelling creative reason"28% (12/43)
Viacom (Paramount)2013"creative vision...filmmaker believes that the depiction of smoking or tobacco is important to the film"41% (11/27)
Lionsgate---No published policy44% (17/39)
CBS---No published policy50% (2/4)
Open Road---No published policy50% (2/4)
4. Where does the "Tobacco Grade" come from?

UPDATE: As of August 2019, we've updated our tobacco grades from a "five star" system to a letter grade system. Read on to learn how we grade funds on tobacco.

Tobacco Free Funds scans mutual fund holdings for two types of companies: tobacco companies, and tobacco-promoting entertainment companies. If any companies on our screen lists are found in a mutual fund's portfolio, we calculate the overall exposure. See below the lists of the specific companies we screen for.

Based on whether or not a fund has investment in these two types of companies, we assign a letter grade.

Fund is not invested in tobacco companies, and not invested in tobacco-promoting entertainment companies

If the fund is not invested in any of the tobacco companies or tobacco-promoting entertainment companies we screen for, it earns an A grade.

Fund is not invested in tobacco companies, but is invested in tobacco-promoting entertainment companies

If a fund does not invest in tobacco companies, but does invest in tobacco-promoting entertainment companies, it earns a B grade.

Fund is invested in tobacco companies, and may also be invested in tobacco-promoting entertainment companies

If a fund invests in any tobacco companies, it earns an F grade.

Special engagement grade: Fund is offered by an asset manager with a proven track record of engaging the companies it invests in to push for better corporate behavior

We identified a small number of asset managers that have filed sustainability-related shareholder resolutions, signed investor letters, or otherwise shown a commitment to engaging the entertainment companies they own on tobacco issues. If a fund is invested in entertainment companies, but the fund family is a known sustainability engager, it earns a special "engagement" grade.

Read more about funds that engage companies on tobacco.

For more on our screening methodology, visit our How it Works page.

5. What are socially responsible funds? What about funds that engage the companies they own to push for better behavior?
Socially responsible fund icon

Socially responsible funds make investment decisions based on issues like environmental responsibility, human rights, or religious views. A socially responsible fund may take a proactive stance by selectively investing in, for example, environmentally-friendly companies, or firms with good employee relations. They may also avoid investing in companies involved in promoting alcohol, tobacco, or firearms, or in the defense industry. Look for this symbol to find funds that are socially responsible.

US-SIF - The Forum for Sustainable and Responsible Investment icon

US-SIF - The Forum for Sustainable and Responsible Investment is a group advancing sustainable, responsible, and impact investing. Asset managers who are members of US-SIF often have policies to exclude or restrict investments in companies involved in the production, licensing, and/or retailing of tobacco products, or in the manufacturing of products necessary for production of tobacco products. Look for this symbol to find funds that are members of US-SIF.

Some socially responsible funds go further, actively engaging the companies they own to promote sustainability and long-term value. Indeed, efforts by socially responsible investors whose funds are found on this site have been crucial to driving positive change at movie studios. Shareholder pressure helped drive Disney to pledge to remove smoking from all films that it produces rated PG-13 or lower.

A number of fund families have taken actions such as signing investor letters, or filing shareholder resolutions asking for social and environmental policy changes at the companies they invest in. These fund managers deserve special acknowledgement - often, they’re using their investments to make sure they have a voice at the table to call for real improvements in company behavior.

We identified fund families that have signed investor letters, filed shareholder resolutions, or otherwise shown a commitment to engaging the entertainment companies they own on tobacco issues. If a fund is invested in entertainment companies, but the fund family is a known engager, it earns a special score. Look for the engagement symbol to find funds from asset managers that engage entertainment companies on tobacco issues.

Are you a fund manager that has filed a social or environment-related shareholder resolution, or otherwise engage the companies you own on tobacco public health issues? Get in touch - we’d love to hear from you.

6. What companies do you look for when funds are screened?

Two screens are applied to each fund – a list of tobacco producers and manufacturers of tobacco products, and a list of entertainment companies that promote tobacco to kids by failing to properly rate their films.

7. Why do you emphasize 401(k)’s? Does the tool work for other types of investment vehicles?

For many of us, the majority of our investments are in 401(k) plans offered by our employers. 401(k)s invest mostly through mutual funds and exchange-traded funds (ETFs). But those funds can invest in a wide array of securities, and it’s not always easy for investors to investigate what’s inside the funds they own. You can spend hours poring over mutual fund prospectuses, and still not fully grasp everything your 401(k) is invested in. Your retirement money may be invested in economically and morally risky tobacco companies.

But regardless of how your money is invested — whether through a 401(k), a traditional or Roth IRA, a pension fund or other vehicle — if you hold mutual funds, we can help you analyze them for tobacco holdings.

You can request that your employer include Tobacco Free options in your 401(k) plan — learn how.

8. Who is As You Sow?

As You Sow promotes environmental and social corporate responsibility through shareholder advocacy, coalition building, innovative legal strategies, and online financial transparency tools. We are the nation’s leading non-profit organization practicing direct shareholder engagement on environmental, social, and governance issues. Founded in 1992, As You Sow believes that corporations must be willing participants in solutions to most of today’s pressing issues; and we believe that shareholders are the single most powerful force for motivating that participation. We use that power to protect health and the environment and to create positive, lasting change in corporate behavior for the long-term benefit of humanity.

In 2015, we launched Fossil Free Funds so that people could see if their retirement was funding climate change. In 2016, we followed up with Deforestation Free Funds. We are committed to transparency, corporate accountability, and empowering individuals to take control of their investments.

9. Where do you get your data?

The financial data powering Tobacco Free Funds is sourced from Morningstar. Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company works directly with investors and financial advisors to create products that help them meet their personal financial goals, providing the most reliable and pertinent information available on investment vehicles across industries. Morningstar provides data on approximately 500,000 investment offerings, including U.S. stocks and mutual funds, along with real-time global market data on more than 14 million equities and indexes, as well as foreign exchange and Treasury markets.

Tobacco companies are identified using Morningstar industry classifications. Under Morningstar’s Global Equity Classification Structure, each equity is mapped into one of 148 industries that most accurately reflects the underlying business of that company. This mapping is based on publicly available information about each company using annual reports, Form 10-Ks, and Morningstar Equity Analyst input as its primary source. Other secondary sources of information may include company websites, sell-side research (if available), and trade publications.

See the full list of Morningstar industry classifications

Get in touch


Media and General Inquiries

Andrew Montes, Director of Digital Strategies, As You Sow