Monday, 14 July 2014

Long Spoon

The CMIC logo
Twenty five years ago, CAMRA set up the CAMRA Investment Club for members who wished to put their money into a portfolio of shares in the brewing industry. I very strongly disagreed with this at the time on the grounds that it would blur the distinction between the Campaign and the companies it was campaigning about, but unfortunately some CAMRA people have the political awareness of an empty lager glass. It still exists today, renamed the CAMRA Members' Investment Club (CMIC) in an attempt to put it at arm's length from the parent organisation; they no longer use the CAMRA logo for the same reason.

CMIC has been criticised recently for owning shares in pub companies (pubcos) such as Punch and Enterprise, who are widely regarded as one of the main causes of the problems pubs are currently facing. At the CAMRA AGM, the National Executive was accused of being far too cosy with the pubcos, and urged to take a more radical stance against them - in other words, campaign against them, as in the first word of the organisations' name.

The argument for holding the shares is that it entitles CMIC to attend the pubco AGMs. That's not much of a defence, especially as I've yet to hear of a single campaigning achievement resulting from attending. In my view, holding the shares can be interpreted as endorsement by CAMRA of the pubcos, even though I know that was never the intention; the trouble is you can't dictate how other people construe your actions. It would help if CMIC renamed itself something like the Real Ale Drinkers Investment Club, because so far the attempts to put some distance between it and the Campaign haven't really worked. To be fair to CMIC, they've said they will sell the pubco shares if CAMRA asked them to. So it's up to CAMRA, which should bear in mind what they say about he who sups with the devil.


  1. well yeh, they're gonna get conflicts of interest.

    The influence an investor can have over a company depends one the % of the company owned. If you can't force a director onto the board the influence is f all.

    Therefore ownership of the stock becomes a vote of confidence in the management. Lack of confidence is a reason to sell.

  2. Their holdings are very small, for example around £4000 in Enterprise, for which CMIC has actually achieved nothing other than, as you say, looking as though they endorse the management.

  3. They won't get nothing for it, Nev. Last pubco financial data I read put the debt at approx £500k per pub owned on an Estate where the average pub value was £500k. meaning they're ain't no actual equity.

    Not the problem you think it is, the very best companies generate cash on no actual assets.

    If the pubs were profitable, it wouldn't matter, the debt would be serviced and the equity holders would receive a return, but they ain't profitable.

    I suspect these investments have been a drag on the fund in addition to making the beard club look like hypocrites.

  4. The small value of the pubco holdings is largely due to the collapse of the share price. In March 2007 the holdings in Punch and Enterprise were both worth over half a million.

    But pretty much any company you invest in will do something you disapprove of - where do you draw the line?


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