P R I S M2 0 0 8

23

GRO

WING GREEN PROFIT

S

A g

uid

e to mAking sustAinAble, life-Affirming inves

tme

nt

s

b

y K

ar

en

S

til

le

r

Po

rtia

Re

mn

an

t/S

hu

tte

rst o

ck

P R I S M2 0 0 8

24

So, there I was in Boston in the springtime. As part of my husband’s doctoral graduation celebrations, we were herding our family down the historic Freedom Trail that winds its way through the city.

Somewhere between Benjamin Franklin’s statue and Paul Revere’s house I saw the first bunch of protesters pointing fingers at a company profiting from Darfur’s agony. The plac-ards would continue to pop up during our tour, and so would my feeling of unease.

I knew that company’s name. I had seen it somewhere, something to do with one of our own modest investments.

That was a creepy moment, but it has led me down my own freedom trail of learning how to ensure that our family’s investments are not out harming the world while making us profits. That goal is what lies at the heart of ethical investing—also known as “socially responsible,” “faith-based,” “sustain-able,” “spiritual,” or “green” investing.

Whatever we call it, ethical investing means putting our money where our mouth is by investing in stocks, bonds, funds, and companies that meet certain ethical, social, and environmental standards that we say are important to us.

And for those of us who still love a healthy dose of activism, ethical investing can also involve shareholder rab-blerousing, where investors deliberately put their money in companies doing disagreeable things in an attempt to change them from within.

Ethical investing is where our wallets meet our wishes for the world. The good news is we don’t necessarily have to sacrifice profit for principles or be a financial genius to figure it all out. I’m definitely not—and here is what I discovered.

the bible bAseWe’ve all heard that pesky factoid about Jesus talking more about money than anything else. Mark Regier is manager of stewardship investing for Mennonite Mutual Aid, based in Goshen, Ind. “The Bible talks about money, resources, and their interactions in our lives,” says Regier. “The New Testament is full of reminders that we are to be constantly aware of how we impact those less fortunate. But Wall Street has done an incredible job of putting it in our mind that there is only one question you bring to the marketplace, to the idea of making money, and that is ‘Who can make me more?’”

Gary Moore is a financial advisor and the Florida-based author of Faithful Finances 101: From the Poverty of Fear and Greed to the Riches of Spiritual Investing (Templeton Foundation Press, 2005). He’s also founder of the Financial Seminary (financialseminary.org), a nonprofit organization that encour-ages the reintegration of spirit and ethics into the world of money.

Moore believes that most Christians aren’t so great at that type of integration. “The church has abandoned economic morality,” says Moore. “It’s quite sad. It’s a huge issue that has a whole lot of implications.” Years ago, Moore set out to rediscover what the Bible had to say about money. “I reread the Bible from front to back. I was amazed at the level of responsibility Moses demanded. Most of their wealth was in livestock. And Exodus 21:28 says that if your bull makes a habit of hurting other people, society will not only kill your bull, it will kill you as well. Now that’s social responsibility taken quite seriously.”

Probably only a handful of us own a bull. But we do have resources that can be used for good or for evil. That choice matters, says Sister Ruth Kuhn of Region VI Coalition for Responsible Investment in Mount St. Joseph, Ohio. “As a Christian, you have been asked to do good. In the New Testament there are the questions that will be asked of you in the last judgment, like ‘Did you feed the hungry?’ If Jesus lived in our time, he would probably add to that list ‘How did you use the money you had?’” says Kuhn. “You can use it to donate to good causes, but there is a certain percentage of your money today that is earning money in investments. What did that money do?”

Knowing what your invested money is doing is at the heart of ethical investing, and those who practice it say it is a clear, contemporary application of the Bible’s ancient teach-ing on money.

screen for pluses And minusesBack in the 1920s, they were called “sin stocks,” explains Laura Berry, executive director of the Interfaith Center on Corporate Responsibility (iccr.org), a New York-based association of nearly 300 faith-based institutional investors. “The roots of the social investment movement go back to avoidance of stocks like gambling and alcohol.”

Berry says a first step for “retail investors” (people brave enough to do their investing sans financial advisor) is negative screening. “You say, ‘I don’t want to make money off companies doing this kind of work.’” That involves deciding what your priorities are and then doing research to see who’s doing what where—not a small task for the individual investor. The ICCR does have an advocate program geared to individuals that includes monthly email alerts and a magazine that reports the progress ICCR has made with individual corporations in their shareholder activism. That kind of information can help inves-tors learn more.

The real global impact, however, says Berry, is when investors move on to “positive inclusion,” looking for companies “known to be leaders in environmental action. You start by screening out the bad guys. Then, you start looking at those doing

GROWING GREEN PROFITS

P R I S M2 0 0 8

25

A current ICCR campaign is calling on big names like Kraft Foods and McDonald’s, along with 61 other American companies, to stop the planting of genetically modified beets. Sending the message “Don’t Mess with Sugar,” their website, DontPlantGMOBeets.org, had over 26,000 hits when it went live, and it generated more than 60 articles in the press.

“We sometimes think of strategies a few years in advance,” explains Berry. “We’re now talking to hundreds of public com-panies around issues like supply chains, access to medicines, sub-prime lending, and, of course, things like human rights and environmentalism.”

At the World AIDS Conference in Toronto, Canada, in August 2006, ICCR unveiled its research on pharmaceutical companies’ response to HIV and AIDS globally. The report, called Benchmarking AIDS, was the first time all the world’s top pharmaceutical companies were ranked on their response to the pandemic and access to essential medicines. Another strategic and recent report is Banking at the Bottom of the Economic Pyramid, which helps set ethical parameters around the growing world of microfinance loans to the poorest of the poor.

“We look at our history and say, in a very real sense, that a mighty group of 12 people created a way of showing the world a new way to look at corporate and social responsibility,” says Berry. “Faith is about imagining a better future. And we feel it is ultimately about changing the platform about how to make wealth in the world.”

positive things.” Ethical investors argue that this extra layer of investigation

into what companies are doing—or not doing—with your investments can actually enhance returns. Those additional, nuanced screens result in more information about investments —and the more information the better. “Every investment manager on the planet reduces their universe. Everyone screens for something,” says Mark Regier. “And almost all of the stud-ies done in the last 10 years overwhelmingly indicate that bringing your faith and social values into the arena does not need to reduce your returns.” That fact, says Regier, “dra-matically contradicts popular thought, particularly in the advisory community.”

hAve A cup of fAir-trAde coffee with your Advisor

If you work with financial advisors already, they can be your ally in the transition to socially responsible investing—if they’re on board, or at least willing to climb on. Many investment companies and pension funds already have ethical fund choices in place, and the fact that some large pension plans are buying in is a sign that ethical investing is starting to go mainstream.

Spend some time educating yourself, even if just superfi-cially, before bringing it up with your own advisor. Regier recommends sites like SocialInvest.org or SocialFunds.com. The latter is designed especially for individuals, so is probably

HISTORy OF a mOvEmENT

In 1971 a group of Protestant clergy came together and started to ask some tough questions about their pension funds. They were concerned that they might be personally benefiting from the ongoing war in Vietnam and the horror of apartheid in South Africa.

Their questions led to an organization that quickly became a pioneer in the world of socially responsible investing and today is a leader in the world of faith-based investing. The Interfaith Center on Corporate Responsibility (ICCR; iccr.org) filed its first shareholder resolution in 1971 when it called upon General Motors to withdraw from South Africa. Other resolu-tions soon followed, on that and other issues, and they haven’t stopped since.

Today, their membership is trans-denominational, Protestant and Catholic, with nearly 300 faith-based institutional investors that include entire denominations, religious communities, pen-sion funds, foundations, colleges, and unions, among others. Together, they represent almost $100 billion in invested capital. With God’s help they have made themselves a force to be reckoned with.

ICCR has nine working groups that focus on different areas of concern at the same time. “Those folks,” says Laura Berry, ICCR’s executive director, “bring issues to us where corporate advocacy can make a difference”—issues like water usage in India by Coca-Cola and how that same company interacts with African workers battling HIV and AIDs.

Continued on page 30.

P R I S M2 0 0 8

30

more penetrable for the average person. If your financial advisor doesn’t know the world of social-

ly responsible investing, and doesn’t want to, a sympathetic advisor is probably just a Google away. Regier says that “what we hear most often is that an investor will go to their advisor and talk to them about this, and the advisor says, ‘Oh no, you don’t want to do that,’ and it chills them out. Find an advisor who understands and is willing to share your perspective,” advises Regier. “There are many out there.”

now to the rAbble-rousingAnother way you can get involved in socially responsible investing (and be a thorn in the side of somebody big and powerful, which is always fun) is to buy stocks in a company you wish to influence. Then you can file a shareholder reso-lution which, according to Sister Ruth Kuhn, is nothing more (and nothing less) than “a request to a company to do something” by one of its own-ers. Shareholders are required to own at least $2,000 worth of shares in a company, and prior to filing you must have owned the stocks for at least one year. This is where ethical investors sometimes group together for action.

“If a company is involved in something positive, then you want to invest in them to encourage them, to provide the capital for what they are doing,” says Kuhn. “If it’s neg-ative, then you may say, ‘I don’t like this and I don’t want any-thing to do with it,’ or ‘I do want to be involved so I can influence them.’”

But be ready for the long haul with this kind of share-holder activism. As an example, Kuhn, who sits on the ICCR board, points to that organization’s involvement with the issue of apartheid in South Africa. They started filing resolutions with companies invested in South Africa long before apartheid actually fell in the late ’90s. It took patience and perseverance, but eventually it did have an impact.

All investors have a world of influence at their fingertips already, by influencing the companies they are currently invested in. Kuhn explains that if you use a fund manager, that manager has been voting on company resolutions on your behalf all along.

“If I don’t request my proxy statements,” says Kuhn, “then my manager will have been receiving them and vot-ing on them. And usually fund managers vote the way the companies ask them to,” because proxy statements include voting directions from company management.

Laura Berry of the ICCR says that mutual funds are required to let you know how they voted your proxies. “It will be right in their annual report. Contact your company and tell them you’re interested in knowing how they voted. They need to know their customers are paying attention to this stuff.”

And if you discover an order of nuns or priests putting a resolution forward, “you can bet your bottom dollar there

is an ethical faith element” to what they are trying to achieve. “Vote with the nuns,” advises Berry. “They do their home-work.” The ICCR’s website offers a list of their current shareholder resolutions and campaigns that can help guide interested individuals and get you started on the road to ethi-cal investing as well as share-holder activism.

fAcing our own money issues

“Is retirement about a series of back-to-back cruises?” asks Mark Regier. Well, a tiny part of me actually does want to go on at least one cruise when I can still make it unassisted up the boarding ramp. But I know I need to hear the call of these prophets of profit who argue

that socially responsible investing is a not only a good choice for our world but a good choice for our wallets as well. n

Based in Port Perry, Ontario, Karen Stiller is associate editor of Faith Today magazine, published by the Evangelical Fellowship of Canada, and editor of Women Alive magazine.

Growing Green Profitscontinued from page 25.

Po

rtia

Re

mn

an

t/S

hu

tte

rsto

ck