The stock market is often viewed as an arena governed by one rule: make as much money as possible in any way possible. The financial meltdown of 2008 and consequent Wall Street scandals seemed to confirm that negative view. But promoters of socially responsible investing say there are ways to influence the market to promote other values.
The socially responsible investing movement has been led by faith groups who often have differing agendas. But there are three general approaches that most groups stress:
One is counseling investors how to avoid investing in companies whose practices would violate their beliefs.
A second is to promote investments in ethically-problematic companies in order to gain a platform and influence inside the company and thus change its practices.
A third approach is to promote ethically-responsible businesses by directing investments to them.
Denominations and religious organizations and universities and their pension funds control billions of dollars in assets, and that gives them sway….
National leaders and the general public look to the stock market as an indicator and promoter of economic recovery, and a rising market will draw investors back. The socially responsible investing movement wants to make sure those funds are invested in ways that respect ethical and religious convictions, and also push companies to promote the common good.
This edition of ReligionLink provides resources and background for reporters covering this developing story.
Developments
- The Presbyterian Church (USA) will debate (again) gay clergy and whether to pull church investments from companies that are involved in Israeli actions against Palestinians.
- Investment firm MSCI Inc., says it has removed Caterpillar Inc., from three of its lists that track socially responsible investing because of Israeli military’s use of its bulldozers against Palestinians.
Background
Many practitioners of socially responsible investing say its roots in the U.S. date back to money management practices of the Methodists. John Wesley, founder of the Methodist movement, urged his followers to avoid profit at the expense of others. Consequently they avoided partnering or investing with those who earned their money though alcohol, tobacco, weapons or gambling. In doing this, they established early social investment screens. Others trace the movement back to the 1768 Quaker ban on members from putting money into the slave trade.
More information on the development of the movement can be found in this article from the New York Stock Exchange, the socially responsible investing about.com page, or the wikipedia page.
Resources
News Articles
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“Investing with a clear conscience”
A Jan 8, 2012 Our Sunday Visitor article includes a list of companies that provide Catholics with screened investing opportunities and outlines traditional guidelines of Catholic investing.
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“Voicing consumer concerns can change corporate practices”
Another Jan 8, 2012 Our Sunday Visitor article includes list of companies that would not be found in a screened catholic portfolio.
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“Good Returns”
Read a Jan. 16, 2012 article from America Magazine about whether it is possible to follow your conscience and beat the S&P 500.
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“Social activists try to help companies do more good”
Watch a video interview with Rev. Seamus Finn and Sister Pat Daly, from the Interfaith Center on Corporate Responsibility.
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“Growing divestment campaign among churches targets biggest US banks”
An April 27, 2012 article from Catholic News Service describes a growing divestment campaign among churches targeting U.S. banks.
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“Fund-award winners buck expectations, stereotypes”
Read a March 12, 2012 article from Reuters about the mutual funds that won Lipper Awards and why.
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“HOW TO PLAY IT: Building a socially responsible portfolio”
A March 9, 2012 article from Reuters is an introduction to socially responsible investing.
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“Saints beat sinners for sustainable investing”
A Feb. 22, 2012 National Catholic Reporter article responds to a Bloomberg article about sustainable investing.
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“Resources: How to invest faithfully and responsibly”
See a Nov. 4, 2012 compilation of resources on socially responsible investing from U.S. Catholic.
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“New Bottom Line: Angry Churches Pull Money From Big Banks”
Read a Nov. 22, 2o11 article from Religion News Service about groups of churches pulling money from banks.
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“Online Boycotts Separate Corporations from Christian Groups”
A Sept. 26, 2011 article from Christianity today discusses how online boycotts influence corporations.
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“Beer, wine not on church’s list of immoral investments”
Read a Nov. 2011 article from Religion News Service about the investing guidelines issued by the Lutheran Church in Germany that considers companies producing hard liquor immoral.
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“Faith and Finance: How Religious People Use Their Money”
A Huffington Post May 11, 2011 article discusses the intersection of faith and finance.
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“Faith and Values Inspired Investments”
An April 12, 2012 article from the Huffington post discusses faith-consistent investing.
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“Investment Ethics”
Read the United Methodist Church’s guide to Investment ethics.
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“A Guide To Faith-Based Investing”
Read Investopedia’s Feb. 29, 2012 guide to faith based investing.
National Sources
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Brother Louis DeThomasis
Brother Louis DeThomasis, FSC, was president and professor of Interdisciplinary Studies at Saint Mary’s University of Minnesota from 1984-2005 and is the co-founder and former president of the Christian Brothers Investment Services (CBIS). He is currently the President of CBIS-Global based in Rome.
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Michael Van Dam
Michael Van Dam is Director of Communication at Christian Brothers Investment Services.
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Susan Paykin
Susan Paykin is The Religious Action Center of Reform Judaism legislative assistant.
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Mark Schwartz
Mark Schwartz is a Associate Professor at York University who specializes in Business ethics.
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Interfaith Center on Corporate Responsibility
The Interfaith Center on Corporate Responsibility, based in New York City, is a North American association of nearly 250 Protestant, Roman Catholic, and Jewish institutional investors working to hold corporations accountable to stewardship of the earth, among other issues. Contact Susana McDermott, director of communications.
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Jared L. Peifer
Jared L. Peifer is a postdoctoral fellow of sociology at Rice University and the author of the paper Morality in the Financial Market? A Look at Religiously Affiliated Mutual Funds in the USA.
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Ave Maria Funds
Ave Maria Funds is one of several funds for Catholic investor.
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LKCM Aquinas Funds
LKCM Aquinas Funds is another mutual fund that adheres to Catholic values.
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Amana Funds
Amana Funds are mutual funds designed to meet the needs of Muslim investors.
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Friends Fiduciary
Friends Fiduciary provides Quakers with financial services that is grounded in beliefs of the church. Jeffery Perkins is Executive Director.
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Kirk O. Hanson
Kirk O. Hanson is Santa Clara University’s John Courtney Murray S.J. University Professor of Social Ethics. He is one of the pioneers of the business ethics field and taught business ethics at the Stanford Graduate School of Business for 23 years.
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Oiko Credit
Oiko Credit is a worldwide financial institution that promotes global justice with credit, and was founded by the World Council of Churches. Terry Provance is Executive Director.
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Amy Domini
Amy Domini wrote the book Ethical Investing and founded Domini Funds, of which the Media contact is Matthew Casey.
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Mary Brunson
Mary Brunson is the Vice President of Investing for Catholics.
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Séamus Finn
The Rev. Séamus Finn is a leader in faith-based socially responsible investing and is active with the Interfaith Center on Corporate Responsibility.