Moody’s: Tobacco Has High Social Credit Risk

With $175 billion of rated debt, the tobacco industry has a high “social credit risk,” according to a new analysis by Moody’s Investors Service analyzing 82 global sectors.
 
“While combustible tobacco’s health dangers are the main reason for the sector’s high social credit risk, other drivers include customer relations, responsible production and demographic and societal trends,” said Roberto Pozzi, Moody’s senior vice president and author of the report.
 
Alternative products, he added, may help offset the negative credit impact of social risks.
 
Last week, Moody’s kicked off its 14-part series on social risks impacting credit in high-risk sectors with a look at the global gaming industry. The series examines the credit impact of social issues in multiple industries with roughly $8 trillion in combined rated debt.