Advantage Capital Strategies Group identifies industries that have detrimental environmental, social, and economic effects and takes action to mitigate risk both through screening and advocating for change.

The Gambling Industry Explained

According to the Government of Canada, the gambling industry “comprises establishments primarily engaged in: operating gambling facilities, such as casinos, bingo halls and video gaming terminals; or providing gambling services, such as lotteries and off-track betting.” Gambling profits sometimes comprise a significant portion of the revenues of cruise lines, hotels, and resort companies.

Advantage Capital Strategies Group has chosen to divest from companies who derive at least 10-30% or more of their total revenues from the gambling industry.

The Economic Rationale for Divestment

The gambling industry is highly dependent on government regulation in North America and Europe.  In Canada, gambling is only legal when it is conducted through the provincial government, which may contract out the operation of the facility to a private company but continue to retain a majority of the revenues. For example, Great Canadian Gaming Corporation is contracted by the province of British Columbia to operate gaming facilities; the provincial government retains 2/3 of revenues while Great Canadian retains the remaining 1/3. Online gambling is also regulated by the provinces.  Accordingly, the industry is greatly impacted by changes in government policy, which introduces a risk factor in investment.

There is also significant black market competition in the gambling industry, particularly in the United States.  The black market industry is not subject to the same state and federal taxes that regulated gambling must adhere to in the US.  The American Gaming Association estimates that Americans spend approximately $150 billion in black market gaming. This illicit competition poses another risk factor for investment.

The Social Rationale for Divestment

Advantage Capital Strategies Group has identified two primary social motives for divesting from the gambling industry.  The first is that gambling losses disproportionately affect those in low-income brackets.  Recent research indicates that individuals in low-income brackets spend on average 2.8% of their household income on gambling as compared to 0.5% spent by those in higher income brackets. This is of concern as studies indicate a link between problem gambling and poverty.

Our second social motive for divestment is problem gambling.  Problem gambling occurs when an individual who engages in gambling has difficulty restricting the resources – time and money – they spend on gambling.  This can affect not only the individual but also his or her family and the community, and it is considered a public health issue.  According to Statistics Canada, problem gambling affects 1 in 15 Canadian gamblers. 

Furthermore, problem gambling disproportionately affects those in marginalized groups, including Indigenous populations, those with mental illness, homeless individuals, and those living in disadvantaged neighborhoods. Problem gambling has also been identified as a factor leading to increased probability of homelessness.

In Canada, government receives much of the revenue from gambling, allowing it to be spent on government programs, including social services such as problem gambling treatment programs.  In other jurisdictions, this is not necessarily the case.

The Environmental Rationale for Divestment

There are not significant negative environmental impacts associated with the gambling industry.  Our primary driver for divestment is social.

Works Cited

Government of Canada:


Great Canadian Gaming Corporation:


Gambling Research Exchange Ontario:

University of Calgary: