Investing in SIN Business?
Authored by Rohan Mehta, CEO and Portfolio Manager at Turtle Wealth.
This picture of Sachin Tendulkar is what reminds and questions us about our integrity in doing business, investing and life!
In the golden era of the 1990s, when a cigarette brand was the main sponsor of the Indian Cricket team many individual Cricketers especially batsmen got handsome amounts to put stickers of that brand on their bat. However, one individual refused to do that just because of integrity reasons, and that man today is known as the ‘GOD of Cricket.’
This incident is very close to my heart, my father a great cricket buff told me this story, and it left an impression in my heart. Why would a person when everyone is doing it, refuse to endorse a brand when no one is going to put the finger on him? Also, you need to understand that time was a non-social media world, where everything was not noticed so much in deep.
Today, almost every cricketer and Bollywood star promotes a Tobacco company just out of the lust of having more money. But what about moral values? There is a big integrity question in society. Though you will never see GOD or THALA (Sachin or Dhoni) indulging in this type of product. No wonder they are respected so much!
Returning to our lives, we all uphold moral values derived from our religion or family. These values often include abstaining from alcohol, tobacco, casinos, and violence, principles we avoid ourselves and teach our children. Yet, when it comes to investing, why do we sometimes overlook these values and prioritize profit over ethics?
In 2016, I had a conversation with Nemish Shah (ENAM) about wealth and investing. He emphasised the role of luck in investing and mentioned that avoiding investments in morally questionable businesses is a way to create luck. This reminded me of the story of Sachin Tendulkar's sticker on his bat. I asked Nemishbhai why not invest in a great company even if it's in a "sin" business, and donate some profits to society. He replied that true partnership means not being associated with such businesses.
This conversation stayed with me, leading to introspection about my own moral values. In 2019, when we received the PMS license, our company decided not to invest in businesses involving animal killing, liquor, tobacco, leather, casinos, or hotels. This applies to every client with Turtle. While we may have missed some stocks, our adherence to these values has brought us great success, making us one of India's top 10 PMS performers.
If this resonates with you, take a moment to review where your money is invested. Whether in mutual funds, PMS, AIF, ULIPs, or individual investments, ask yourself if the profit from "sin" businesses aligns with your wealth's true worth.
Disclaimer: The opinions expressed above are personal and may not reflect the views of DSIJ.