I'd like to point out a few things in response to Dr. Edward Cheah's letter entitled 'Do not succumb to free-market extremists' (Dec 10).

Dr Cheah asked, 'What is the use of paying handsome dividends to Malaysians whose health, physical and psychological, has been eroded or destroyed by smoking, alcoholism and gambling? More dividends for smokers, alcoholics and gamblers means that they would have more money to indulge more heavily in these activities. A vicious circle would ensue. Ultimately, the nation would be weakened and destroyed because of its sick and vice-addicted citizens.'

Those who chose to invest in these high dividend stocks are not necessarily smokers, drinkers orgamblers. There are those who choose to invest because they think these stocks will yield them a good return.

Even so, if we follow the moralistic argument of Dr Cheah, does that mean that the government must not increase the wages of gamblers, drinkers and smokers in the civil service because this will lead to them to misuse the money given to them?

Dr Cheah also said that 'For the sake of argument, let us assume that EPF continues to invest in gaming, alcohol and tobacco companies in the name of 'market fundamentals', why then is it wrong for some wealthy men and women (don't ask where their money come from!) to invest in prostitution, pornography, slavery, destruction of forests and green lungs, and drugs of all kinds, also in the names of 'fundamentals', 'free market' and 'free trade'?'

The companies involved in gaming, alcohol and tobacco are listed companies because they have been approved by the Securities Commission. Are there any companies currently on the KLSE that are involved in prostitution, pornography and slavery?

Are there any such companies that are seeking approval to be listed? In reference to investing in the destruction of forests and green lungs, does that mean that investing in property and palm oil stocks should also be disallowed given that these activities involve the destruction of forests and green lungs? How about the banks and other financial institutions who lend to these companies? Should we ban investment in those as well?

It is dangerous to heap our moral preferences upon society at large especially when there are already institutions such as the SC set up to safeguard abuses to the system (as far as possible in a Malaysian context). The issue here is what kind of stocks EPF should invest in.

Some writers to this column as well as DAP chairman, Lim Kit Siang has suggested that there be two separate funds managed byEPF - one for Muslims and one for non-Muslims.

I would go further than that and recommend that there be a move by the EPF to allow the placement of EPF monies in different external funds which invests in companies in different industries and with different risk profiles to suit the preferences of the respective EPF shareholders. This way, EPF shareholders can 'maximise' their return based on their own risk-return, moral and religious preferences.