The Superannuation Fund has been investing in tobacco in breach of its own rules not to.
The Green Party has revealed the fund holds 80,000 shares in Shanghai Industrial Holdings, which is involved in the manufacture of tobacco.
Greens co-leader Russel Norman says the Fund has acknowledged the oversight and is in the process of selling its holding.
Howeber, he says the Fund is a large investor and should have the ability to screen its investments.
Dr Norman says the Superannuation Fund still has an investment in an Indian compan involved in the manufacture of nuclear-armed submarines.