Approaching the Faith-based Market Using Stewardship Investing to Build Your Business

Socially responsible investing

• Definition: Investment decision-making process that considers social and environmental implications

• Often takes the form of negative screens

• Perceived “activist” focus

Faith-based investing

• Definition: A form of investing that considers religious faith teachings to guide or influence investment decisions

• Looks at why these issues are important

• Can be “another door”

Stewardship investing

• Definition: An investment decision-making process rooted in a faith-based understanding of holistic stewardship

• Focuses on our responsibilities as stewards of God’s resources

• Meshes financial and social responsibility in single process

Varied Religious Perspectives

• Some well-known names have arisen in the area of religion and finance

• Primary attention on personal budgets and debt reduction

• Many continue to advocate separating religious faith and investment decisions

• “Morality” or ”sin” issues dominate limited social considerations

MMA’s third way

• MMA believes faith-based investors are interested in more than is commonly understood

• Religious beliefs should be incorporated in all parts of your life

• We’ve been doing it for over a half century

How MMA does it

• The three pillars of Stewardship Investing– Company selection– Shareholder advocacy– Community Development Investing (CDI)

• Rooted in a holistic understanding of a socially-engaged Christian faith

Why a faith-based approach could be important to you

• MMA’s 2001 Investor survey

• MMA’s 2002 Religious Fund Study

• Cultural Creatives

• Stock ownership responsibilities

• A culture that expects to combine faith and finances

• Commitment to stewardship

MMA’s 2001 investor survey

Are you religious/spiritual?

79%

21%

Yes

No

2001 investor survey

Combine faith and finances

20%

17%

19%4%

40%

Always/usuallySometimesWould like toDon't come into playDon't know

2001 investor survey

Likelihood of investing in religous mutual funds

4%

26%

21%

10%

39%

Very likely

Somewhat likely

Not very likely

Not at all likely

Don't know

2002 Religious Fund Study

Number of religious mutual funds

01020304050607080

1999 2002

34

75

Growth of religious mutual funds relative to all funds

0 50 100 150

Religious Funds

All Funds

Assets

Number

121%

21%

16%11%

Cultural Creatives & Faith-based Investing

• They are people who want to integrate spirituality into all of life

• Interested in multiple social movements

• Reject traditional media

• Prime candidates for faith-based investing

• One of the best ways to reach them– Wear your values on your sleeve

Combining faith and finance

• Advisers are trained to understand three things about their clients:– Goals– Risk tolerance– Time horizon

Combining faith and finance

• MMA advocates adding a fourth element

• Your client’s ethical profile– Would you like your faith (or spiritual)

values considered when I develop my investment recommendations?

Why you should include Faith-based Investing

• Survey shows majority of investors think it is important

• Many would participate if they knew more about it

Why you should include faith-based investing

• To establish your uniqueness

• To gain client loyalty and trust

• To open a new opportunities for market growth

Our Challenge to You

• Offer every client an opportunity to align faith values and investment decisions.

• Present another “door” to draw people to socially engaged investing

• Watch what happens!

Tools to help you

• Engage Your Faith brochure• Religious Investor Survey booklet• MMA and MMA Praxis annual reports• Community Development Investing brochure• Stewardship Investing philosophy & guidelines• Shareholder advocacy reports• MMA Praxis prospectus• MMA and MMA Praxis web sites

MMA’s Newest Tool

The Stewardship Investing

Toolkit CD