Journal Devotes Issue to Faith-Based Investors
An issue of Green Money Journal, guest edited by Mark Regier of Everence, explores the history and aspirations of faith-based sustainable investing. First of a two-part series.
SocialFunds.com -- Last night, I finished reading Jesus: A Life, a book-length study by the British novelist A.N. Wilson that I bought used for one dollar at my local library here in Vermont. The author's learned search through the New Testament for signs of the historical person of Jesus included a scene from the Synoptic gospel of Matthew, when Jesus held up a coin with the likeness of Caesar inscribed upon it.
“Whose is this image and superscription?” Jesus asked. “Render therefore unto Caesar the things which are Caesar's; and unto God the things that are God's.”
In absolute terms, maybe the rendering becomes intermingled when one contemplates the missions of faith-based investors. On the one hand, the financial professionals and institutional investors among them are required by their fiduciary duty to maximize returns for their clients and beneficiaries; on the other, more now than ever, applying considerations of environmental and social justice to investment coincides with fiduciary duty from a long-term perspective.
This month's issue of Green Money Journal focuses on the evolution and current practice of faith based investing. Edited by Mark Regier of the sustainable investment firm Everence, the issue provides a succinct retelling of the modern history of faith-based investing through the perspective of Timothy Smith, Senior Vice President of Walden Asset Management and the first Executive Director of the Interfaith Center on Corporate Responsibility (ICCR).
Smith locates the concurrent modern origins of faith based and sustainable investment practice in the 1970s, with the movement to end apartheid in South Africa. “As one might imagine, the earliest company responses countered that church representatives didn’t understand business,” Smith writes; “and that a bank couldn’t decide on a loan nor could a company make decisions on where to invest using social or ethical criteria.”
Within a few short years, however, as many as 100 companies were on the receiving end of shareowner resolutions addressing apartheid; “major banks,” Smith continues, “announced they were ending loans to the South African government because of apartheid.”
Smith goes on to connect the dots between the movement to end apartheid and the efforts of sustainable investors to spur meaningful action on climate change, especially as they relate to the current debate over shareowner engagement vs. divestment. “One lesson to be learned from the South Africa experience is that the combination of those pushing divestment and those seeking engagement could well have an enhanced impact on these companies’ thinking and behavior,” Smith writes. “Both can have a creative role to play.”
Additional articles in the journal include an interview with Sr. Nora Nash, a recent recipient of ICCR's Legacy Award; a review of biblically responsible investment by John Siverling of the Christian Investment Forum; and the somewhat more cautionary perspective of Andy Loving of Just Money Advisors.
“I fear that the potential influence of the new, large, powerful, financially flush ESG (environmental, social, and corporate governance)-only assets will steer the overall emphasis of the industry away from the crucial shareholder advocacy and the community/impact investing,” Loving writes. “Indeed, they already have.”
“Are ESG-only firms willing to explore shareholder advocacy and community investing?” Loving continues. “Or have they come into the SRI tent only because they have been convinced that ESG factors are material to the bottom line, to profit maximization?”
In his overview, Regier of Everence takes up the argument developed by Loving. Describing ESG as an evolution of mainstream, and not socially responsible, investing, he writes, “ESG is not designed—and would not have been embraced as it has—if it were seen as a philosophy that pursues a set of values and outcomes that challenges the inherent 'me first, grab as much as you can' rubric that lies at the heart of our economic system and, too often, our human nature.”
“ESG serves to expand the range of investment options for investors who seek to integrate values considerations into their portfolios in some fashion,” Regier continued.