This case uses the California Public Employees’ Retirement System (CalPERS) to set the stage for unfolding an analysis of economics and values in the decision to divest tobacco stocks and bonds from the internally managed portion of the CalPERS portfolio. Written from public sources, it offers a discussion about fiduciary responsibility for long-term retirement security and investment policies around environmental, social, and governance (ESG) strategies for the public pension fund. The material includes financial data that further allows calculations and discussion on tobacco investments outperforming the broader market. The A case opens with the CalPERS investment committee having made a decision to recommend removing tobacco investment restrictions. The CIO reflects on whether supporting investment in tobacco firms conflicts with CalPERS’s member health and health care mission. Did supporting continued divestment mean CalPERS was putting its own social priority and ideals ahead of its clients’ investment goals? The case data should lead most to conclude the fund was breaching its fiduciary duty. This short B case can be handed out in class. This deepens discussion around ESG, the investment fund’s duty, and retirees’ frustration. Despite the CalPERS investment committee’s recommendation to remove restrictions on investing in tobacco stocks, the board of administration decided to broaden limitation and extend the ban to externally managed portfolios in December 2016. Two years later, opposition to CalPERS’s divestment strategy took the form of a campaign to run for a seat on the board of administration. This was followed with the appointment of another CIO who strongly supported ESG investment strategies.