Some disclosures: my youngest son owns 110 shares of British American Tobacco (disclosed in this, and previous reports, as being held by me); I and my wife have investments in collective investment schemes which own various tobacco companies’ shares; I have accepted hospitality from tobacco companies in the past, and may do so again in the future if I am invited. The idea and the decision to research and publish this note were mine.

I do not smoke and never have, as a matter of personal choice; I believe smoking tobacco to be a potential risk to a person’s health and that if someone wishes to avoid the health risks of smoking then not smoking is the best policy. I am very strongly of the belief that should someone choose to smoke, and to continue to smoke, then that is a choice that they have made in full understanding of the potential risks, and it is nothing to do with me. I do not believe that someone smoking near me is a risk to my health.

It is also important to understand that the views expressed are my own, and have been reached through considerable research and thought. I have been researching the tobacco sector, initially as a fund manager and subsequently as a stockbroker, for some 25 years. Through essentially all of that time I have held the view that share prices in the sector offered investors a rate of return which was in excess of the risks being run, both in an absolute sense and also relative to broader stock markets. There have been times when that has been wrong but over the long term investors have been handsomely rewarded. I do not need to be positive on the business prospects for the industry, or for any particular company within the industry. There are no stock recommendations in this note, deliberately, but my stock recommendations are a matter of public record.

I set out these statements as the subject of this note will be seen as controversial to many people. I am not an “industry shill” and I am definitely not “in the pay of Big Tobacco”. As stated, I do believe that smoking entails risks to the smoker. But I also believe that there is an important debate to be had with respect to the tobacco sector but one which is rarely had. As far as the debate has been staged, it has been one-sided and lazy. Some (and perhaps many) of the “facts” regularly presented against the industry are actually no more than “opinions”. An untruth repeated often and loudly does not become the truth.

Although the decision to exclude tobacco investments from a portfolio is often said to have been “on ethical grounds” in our view it is more often a case of personal prejudice. That is absolutely fine as we are all entitled to our own opinions, but to claim that it is more is, perhaps, unethical.