Article originally posted here by GIIN

by GIIN

To achieve a future where impact considerations are integrated into all investment decisions, the GIIN is working with diverse communities to mobilize more capital for impact investing. The faith-based investing community is one of those with whom the GIIN has been deepening ties.

Examples of faith-based investors leading responsible investing initiatives date back centuries, and by expanding into impact investing, these investors have an opportunity to achieve measurable, evidence-backed impact that aligns with the values of these diverse faiths. Given the vast wealth held by faith-based investors, activating their assets toward impact can lead to substantive contributions to global development agendas, such as the UN Sustainable Development Goals (SDGs) and Paris Climate Agreement.

Engaging Faith-Based Investors in Impact Investing outlines key insights from interactions with the faith-based investing community along with proposed engagement strategies that could be assumed by field-building organizations—like the GIIN and others—to support faith-based investors on their impact investing journey.

Read his whole report here on the GIIN website!

Engaging Faith-Based Investors in Impact Investing

by Pete Ochs

From a Christian perspective, what is the purpose of business?  From the top business schools to the renowned economists of our day, the conventional wisdom is that the purpose of business is to maximize shareholder value. While this paradigm has brought many of the world’s poor out of extreme poverty, capitalism, without values, has created a voracious appetite of personal ambition that can extinguish the very good it fosters.  One must simply look at the likes of Enron, the tech bubble, the financial crisis of 2008, and quotes by well-known socialist politicians calling capitalism “unsustainable” and “irredeemable” (Burke 2019). Capitalism is a system that nurtures economic success, but in and of itself lacks the principles that make it virtuous. 

The purpose of business must be answered with the cross in mind. The redemptive purpose of business is to be a catalyst for flourishing.  Flourishing, the economist Anne Bradley explains, is “God’s Kingdom on earth.” It’s us living in God’s abundance, “as an image bearer of our creator.” Flourishing means becoming everything we were created to be.  Flourishing is what the Old Testament calls a blessed life, shalom.  Shalom, or human flourishing, was fully manifested for a brief period in human history. This period was after the creation of man but before man chose to be his own moral authority. Genesis 2:15-18 lays out this flourishing scenario for us. 

“The Lord God took the man and put him in the Garden of Eden to work it and take care of it. And the Lord God commanded the man, ‘You are free to eat from any tree in the garden; but you must not eat from the tree of the knowledge of good and evil, for when you eat of it you will surely die.’ The Lord God said ‘It is not good for the man to be alone. I will make a helper suitable for him.’”

This passage lays out three essential elements required for flourishing: material provision, authentic relationships, and a purpose for living. 

The first is material provision. God placed man in the garden to work it and take care of it (verse 15). And the result of work is material provision – food, clothing, and shelter. These physical necessities of life we call “economic capital.” 

The second is relationships. Seeing that it was not good for the man to be alone, God created a helper (verse 18). We were created to live in community, to live with deep, authentic relationships with our fellow man.  It happens when like-minded people pursue the common good. This we call “social capital.” 

The third element is a strong purpose for living, a Moral Code, without which man cannot peacefully and successfully live in a free and open society. In verses 16 and 17 God defines the difference between knowing good and evil which is essential if we are to flourish.  The complexities of living in community with market-driven economic transactions, interdependent relationships, private property, and competing interests cannot be beneficially managed without a rule of law, a Moral Code, a Purpose for living for something greater than yourself. This is called “spiritual capital.” 

Over the last twenty years our company, Capital III, has come to fully embrace this triple bottom line approach to business. The philosophy or business model that we employ to ensure that our company creates economic, social, and spiritual capital is called Enterprise Stewardship. 

Enterprise Stewardship

An enterprise is “a business venture, especially one requiring boldness and energy.” Stewardship is “the trusted management and protection of another’s property.” It then follows that “Enterprise Stewardship” is “managing with boldness and energy the business ventures God has entrusted to us.” 

When a business is operating with these principles in mind, the business can be a catalyst for flourishing and the common good. This redeemed enterprise is operating at the intersection of economic, social, and spiritual capital creation. The most thrilling part of embracing this concept of Enterprise Stewardship is that it gives each of us a significant part in solving the world’s greatest problem: the poverty that is simultaneously economic, social, and spiritual.

Economic Capital

Economic capital is the material benefit derived from the stewardship of our LIFE (Labor, Influence, Financial resources, Expertise). It is the result of work that creates wealth that when accumulated results in capital.  The major question surrounding economic capital is this.

How should we as business people, allocate the economic capital (wealth accumulation) created by our businesses?  More specifically, how much should we retain to grow the business?  Should we maximize the bottom line or maximize the benefit to our employees?  How much should be allocated for dividends to the shareholders?  What is an appropriate ROI?  How much of our business profits should be invested in Social and Spiritual capital?  How much should we invest in job creation?  How much is enough?

The answers to these questions are not easy or straightforward, but they are questions we must address if we are to fulfill our role as stewards.  As we do this, we must remember that the primary purpose of economic capital creation is to foster the enjoyment and fulfillment of work itself, not to focus solely on the outcome, profit.   Our work is worship but we should not worship our work.  “So I saw that there is nothing better for a person than to enjoy their work, because that is their lot. For who can bring them to see what will happen after them?” (Ecclesiastes 3:22).  

Social Capital

Social capital is comprised of the mutual benefits (economic, relational, emotional, political, spiritual, etc.) derived by a group of like-minded people pursuing a common cause. The key driver is relationships with the vision to promote the common good.  

Social capital demands mutual trust, common beliefs, and shared rules. In one sense, it’s all the things economic capital can’t buy. Social capital manifests itself in the form of safe communities, good race relations, happy employees, an unpolluted environment, fine art, great music, patriotism, unified families, bipartisan politics, and a genuine love for our fellow human beings.  

Social capital is created when we obey the Great Commandment; “Love your neighbor as we love ourselves” (Matt.22:39).  This then begs the next great capital allocation question.

How do we love our employees as we love ourselves?  Or in other words, how do we promote the common good in our businesses?  How do we help our employees become all that God wants them to become?  Do we truly offer the best benefits and pay?  Are we a place where relationships reign supreme?  Are we the best place to work?  Will our employees wholeheartedly agree that we live up to the values and virtues we espouse? Are we willing to spend the economic capital necessary to create social capital?

Social capital creation is essential if we are to live out the Great Commandment and love our neighbors (employees) as we love ourselves.  

Spiritual Capital

Spiritual capital defines the moral code by which we live and ultimately is the purpose for living.  It defines our why. For those of us who are Christians, it requires our whole-hearted allegiance to living faithful lives devoted to growing in our personal relationship to Jesus Christ and obedience to His Word.  

Spiritual capital is essential because it lays down the rules by which we create economic and social capital.  Capitalism without a moral code results in greed.  Capitalism with God, results in generosity.  Government without a moral code results in totalitarianism.  Government with God, results in political freedom.   When God is taken out of our culture it creates a moral vacuum that must be filled.   Most often this vacuum is filled with GOVERNMENT (rules and regulations) instead of GOD (self-governance) often leading to a loss of religious, political, and economic freedom.   If Spiritual capital is essential for flourishing, here then is the question for those of us in business. 

How do we, using the platform of business, take part in living out the Great Commission?  How do we winsomely share the love of Jesus with our team members?  How do we create a spirit of comradery without establishing a quid pro quo?  How to we honor God in all we do?  How do we publicly profess the name of Jesus to all we encounter?

Spiritual capital creation should be our answer to sharing the Great Commission.

How then should we do business?

You cannot have a redeemed business, enterprise stewardship, without having a redeemed steward as the leader.  Over the years we have come to embrace the four P’s that are essential for a successful business.  These are Principles, People, Products, and Profit.  Without all four fully functioning in a cohesive manner, the enterprise will not attain its potential impact for good.  Consequently, we have developed our values around the four critical components of business and they are reflected below:

Principles – Honor God

People – Serve People

Product – Pursue Excellence

Profit – Steward Capital

The most effective tool we use in our business is simply to ask these four questions whenever we have a major business decision. 

1. Will the initiative Honor God?

2. Will it allow us to truly Serve People?

3. Can we do it with Excellence?

4. Are we being good stewards by making this decision (investment)?

The enterprise is operated and evaluated according to the four P’s (Principles, People, Product, and Profit) which are governed by our four values (Honor God, Serve People, Pursue Excellence, and Steward Capital).

How then do we lead and evaluate the steward(s)?  We do this by associating a character trait to each of our four values.   We call these character traits the four C’s.  And their corresponding value is shown below. 

Honor God – Character

Serve People – Connection

Pursue Excellence – Competence

Steward Capital – Commitment

If one is to be a faithful steward they must be a person of Character (they Honor God), they should exercise the gift of Connection (they Serve People), they should be Competent in their respective talent (they Pursue Excellence), and they are Committed to managing well the resources at their disposal (they Steward Capital).

SUMMARY

Enterprise Stewardship is a tool to be used to redeem business.  It can have great impact as a catalyst for economic, social, and spiritual capital creation.  But business cannot be redeemed without a redeemed steward who will commit to Honoring God, Serving People, Pursuing Excellence, and Stewarding Capital as they live as stewards with great Character, Connection, Competence, and Commitment.  Below is a graphic representing the Enterprise Stewardship model.  

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Citations: 

Bradley, A. (2015, July 2). Flourishing. [Institute for Faith, Work & Economics]. Retrieved from https://tifwe.org/flourishing/

Burke, M. (2019, March 10). Ocasio-Cortez: ‘Capitalism is irredeemable’ Retrieved March 24, 2019, from https://thehill.com/homenews/house/433394-ocasio-cortez-capitalism-is-irredeemable

At the end of every podcast, we like to ask our guests to share what God has been teaching them in this season of life. This week we had Steven Diedrich and Dick Blanc on the podcast, and each of them shared where God has them in His Word, both of them pointing to some similar Old Testament passages.

Steven Diedrich: So I’ve been reading through with my two boys first and second Samuel and we’re into Kings now. And, you know, as we’ve been doing that kind of just Bible study with, you know, a four and a five-year-old, one of the things that I’ve been just really taken from and resting in is God’s sovereignty. And I think even just in the face of COVID, that’s something that I’ve been able to communicate to as the spirit’s been teaching me. It’s this reminder that our security is not in our health, or our security is not in our finances or in our, you know, the income we have. You know, that’s not it. And so even if all that’s taken away. Right, God is sovereign. And that’s just an amazing thing to be able to read. Right. To talk to my little kids about. But also then to turn to our analysts and kind of point them to in this time of uncertainty. God is sovereign. 

Dick Blanc: I’m thankful for Bobby Gruenewald, who I think you guys have interviewed on this podcast before, talking about the Bible app. And my discipline is to essentially go through that every year. 

I love just how easy it is and the availability of it. And so I’m at this point in the year where I get to read about king after king in Israel in a quick summary of their life and their impact as leaders of God’s people, the Israelites. The contrast is so stark when you go through and read each of those chapters. It just basically starts out. And so and so was either a good king following in the steps of David or was not. 

So where God challenges me every year in that particular area is just who will I be as a leader and who will I mentor others to be as a leader? And what, if there was a chapter in God’s word that summarized the impact of my life, what would it say? Would it say I was courageous and bold enough to address the things that God dislikes in the ways he wants? Would it say that I trusted him in his sovereignty and in his wisdom versus aligning and partnering with perhaps another acquaintance or company or partner who has some strength to help me in a difficult situation? Would I look to God and say God, like David, do I go to battle or do something else? And that certainly was a test for all the kings. Could it be said that in the scope of the things that I have the opportunity to lead and steward that I left him better than when I was given the role in terms of, you know, being aligned in God’s mission, in the impact that God wants to make in the marketplace. And that’s what resonates with me. And reminds me every day it wakes me up every day to think how we’re making an impact today.

by John Silverling

This video is a resource from the 2019 CIF Leadership Summit

by John Siverling

Hear Ron Blue and Jeff Cave talk about the history, the present and the future they see for Faith Based investing at the opening plenary of the 2019 CIF Leadership Summit

by Peter Greer

What would it look like if logos and egos could be tamed so that they no longer get in the way of creative partnerships, collaboration, and greater examples of collective impact? 

When I joined the nonprofit sector, I imagined that hard work, compelling missions, and formidable challenges would forge an uncommon spirit of camaraderie—not just within an organization but within an entire sector. Chalk it up to youthful idealism, but I assumed backbiting and competition were far removed from the noble nonprofit.

I understood and appreciated the merits of my co-laborers’ work—providing clean water, combatting human trafficking, feeding the hungry, and expanding access to education—so I never expected the twinge of envy I felt when I heard of worthy organizations’ substantial accomplishments in these sectors.As I sought to understand the source of this uncharitable reaction, I began to realize that, at my core, I subscribed to a scarcity mentality. On a subconscious level, I feared there would not be enough recognition or resources for all of us. More for others meant less for us, so I felt threatened by others’ success. 

When we lead from this posture of scarcity, we’ll inevitably see others as competition. But what if we truly believed that God is a God of abundance, not scarcity? Do we remember that with Christ, five loaves and two fish are enough to feed multitudes? 

Moving toward an abundance mindset opens the door to relationships. It allows us to see others as collaborators instead of competitors. To develop genuine friendships and partnerships that avoid unnecessary duplication and inefficient use of resources. To think beyond our organization and discover our part in a much grander and more compelling mission. 

It was with these realizations that Chris Horst and I wrote Rooting for Rivals in 2016, and for the last several years, we’ve been on a mission to apply the words we wrote. We open-sourced everything we have at HOPE International. Our resource library made organizational documents—from board manuals to operating models—freely available to any interested organization or individual. While clearly there is more to do, we have moved toward a posture of generosity and collaboration. That move has been life-giving. Over the past several years, we’ve actively engaged with other Christ-centered organizations in the economic development sector through The Christian Economic Development Network: a space where organizations could share best practices, learn from each other’s challenges, and encourage one another in our pursuit of transformational economic development.

The CED Network encompasses more than 175 organizations in 65 countries. Through frequent webinars, an online resource library, and an annual summit, members have grown in relationship. We truly believe the wisdom of the Burundian proverb, “You’ll never make it through the dry season on your own.” We also believe that the dry season is not the time to initiate these relationships; it’s the time to draw on them. 

When the pandemic struck in 2020, the CED Network had already been meeting together, establishing trust, and sharing best practices. When it became clear that standard operating procedures were not going to sustain our organizations in this season, none of us knew exactly what to do—but we didn’t have to figure it out alone.

Vision Fund, World Vision’s financial services provider, promptly consulted with global health experts and was among the first to share the resulting health protocols, training materials, and revised standards for gathering they had established. 

Other members of the CED Network were figuring out how to extend grace periods to borrowers and reschedule loan repayments while remaining solvent. These were challenges that every organization in our network needed to address—and perhaps we could have each solved them on our own. But what a gift it was that we didn’t have to!

We built from the foundation of what our peers were successfully implemented, and the men and women we served were better served as a result. The resources donated to each of our organizations went further toward empowering those hit hardest by the crisis. In collaborating with our colleagues across various organizations, we found opportunities to navigate each new challenge together.

This was possible because we truly have grown to see one another as friends and co-laborers in Christ, not competitors for limited resources.

As Christ’s followers, we have the opportunity to work as one body. To move toward the prayer Jesus prayed for the unity of his followers in John 17:21: “that all of [us] may be one … so that the world may believe that you have sent me.”

May we be a people who long to see God’s Kingdom come, even as our earthly kingdoms fade. May we ready ourselves for the work God is calling us into together.