Ethical investing, values-based investing, Bible-based investing; it goes by many terms. Whatever the expression, putting your money where your morals are is beginning to catch on with people of faith throughout the country.
The concept of “Socially responsible investing” (SRI) was born in the ’60s. Investors began to screen their investments to exclude companies engaged in a wide range of corporate behavior including pollution, child labor and even military weapons production. SRI is very popular today, but it is not the same as “values-based investing” (VBI).
In fact, in many ways the two concepts represent widely divergent views. SRI is primarily a liberal school of thought designed to honor Mother Nature, by screening for environmental pollution, nuclear power, animal rights, employee diversity and similar issues. VBI is a more conservative, evangelical Christian school of thought designed to honor God, by screening for investments that are inline with Christian values.
Today, many Christians are disturbed by what they consider “cultural pollution.” Many of them do not want their money supporting abortion, pornography or gay, lesbian and transgender culture. When many conservative Christians begin to examine their financial portfolio, they are surprised to learn that their money is working at cross purposes with their deeply held religious values.
The search for solid moral character in companies often involves taking a closer look at management. Relationships are observed by tracking philanthropic gifts or contracts among board members. Another red flag can be tax disputes. Companies that pay hefty fines to regulators might as well be carrying a sign that reads “trouble.” Fines can indicate a lack of concern for authority. Salary and benefits can be another indicator. If a CEO is making more than $10 million per year, are they more concerned about vigilance or keeping their position?
Corporate scandals are just a part of the recent events that have worked the Christian community into a frenzy. Removing the Ten Commandments from the courthouse, removing “One Nation Under God” from the pledge of allegiance, banning prayer from public forums, cases of public school teachers showing bias against young Christians; all these instances and more have formed a growing flame. As a result, some Christians are increasingly reluctant to allow their investments to fund the efforts of the organizations and companies they ardently oppose.
It is interesting that the technological innovations of today, like the Internet, have made values-based screening available to Christians in a way never before possible. With today’s research capacity it is possible to invest in a wide range of investment alternatives that while secular in design, are morally neutral, based on thorough screening and research.
Eric Heckman has more than 13 years of experience to the field of financial planning. Reach him at www.WealthCreator.com or 297-9800.
