Cornerstone Impact Update - Moral Values and Investing
In the Bible we're told to do ALL to the glory of God. This means not separating certain areas of your life from your faith – even if it means not following the definition of success in the world's eyes. This is why we created the Cornerstone Portfolios. We wanted to have an impact on God's Kingdom with our investments and we know that God cares about how we use our money. For this month's Cornerstone Impact Update the focus is going to be on our moral responsibility. Two of our BRI partners, Eventide and Inspire have pieces focusing on this.
Eventide
But seek the welfare of the city where I have sent you into exile, and pray to the Lord on its behalf, for in its welfare you will find your welfare.
Jeremiah 29:7 ESV
Eventide's white paper, Wealthy Nations Need Moral Sentiments discusses the need of individual's moral responsibility in a free nation. They use both the Founding Fathers and Adam Smith, a Scottish economist and moral philosopher to explain the need of moral responsibility. Adam Smith has a book The Theory of Moral Sentiments that states:
No matter how selfish you think a man is, it's obvious that there are some principles in his nature that give him an interest in the welfare of others, and make their happiness necessary to him, even if he gets nothing from it but the pleasure of seeing it
Obviously with freedom, there comes the ability to abuse the freedom. Eventide uses the example of slavery which stemmed from the lack of moral responsibility – people abusing their freedom for profit. Businesses also play a huge role in our free society, but what responsibility do investors have?
In short, businesses are gearing things towards the interest of their investors; therefore, investors need to communicate what things interest them. Are you invested in a company that takes advantage of its customers in order to gain more profit? Maybe it's best to invest in other companies that have a priority on creating value for its stakeholders over making a profit.
Eventide ties this whole idea of moral responsibility in a free society to the command: "love your neighbor as yourself." They also have a one-pager discussing Jesus' greatest commandment to love God with all your heart, mind, soul, and strength, and to love your neighbor as yourself.
Here's how Eventide applies this commandment to investing:
One aspect of values-based investing involves identifying and avoiding situations where companies disregard the value of humankind, in our view, by providing products or engaging in practices that harm others. This subsequently allows opportunities for Eventide to embrace companies it believes are excelling in creating value through activities that benefit others..."
Eventide's investment ideals include:
- Respecting the value and freedom of all people
- Demonstrating a concern for justice and peace
- Promoting family and community
- Exhibiting responsible management practices
- Practicing environmental stewardship
Here are more details on their investment ideals.
Inspire
Inspire also discusses this same idea of moral responsibility investors have in a blog from the end of August by Shane Enete, CFA, Are Christian Shareholders Morally Responsible?
They use an example of being invested in Microsoft and deserving blame for Microsoft selling a pornographic video game called Metropolis: Lux Obscura. Here's the short answer:
Inasmuch as the corporation acts on the investor's behalf, the investor is a co-author of the wrongful act, and therefore morall co-responsible for it.
Shane goes on to state that the Bible doesn't specifically state what to do – there's nothing in Scripture explaining what a Christian minority shareholder should do in situations where management goes against something in the Bible. In general, there are three ways in which Christian shareholders respond (note: it's important to not judge how someone responds):
- Do nothing
- Stop investing in the stock market
- Change the way they invest in the stock market
The third response is where Bibilically Responsible Investing comes into play. This allows Christians to collectively voice their interests to management and invest in companies that align more with their values.
Learn more on how you can make an impact with your investments on our website.
Do you know what it means to follow God with your finances? Are you confident in creating and sticking to a budget? Would you like to create a plan that both honors God and helps you have financial success? We're hosting a FREE virtual workshop on October 22nd at 4 PM MT / 7 PM ET. This 40-minute workshop is a preview of what our full financial literacy workshop will cover. Sign-up for the workshop here.