This article first appeared in the Green Money Journal

by John Silverling

When the term Biblically Responsible Investing is uttered, a common perception forms in the minds of many investors about a politically conservative, narrowly focused approach to investing that targets a couple of socially charged issues.  Sustainable investors often perceive a great divide between socially responsible investing and biblically responsible investing.  Those perceptions fail to see the change underway in the BRI space, including with those that would consider themselves evangelical.  BRI is experiencing a growth towards a holistic view of investing and faith, bringing into focus the ideas of positive screening and equity selection, shareholder advocacy, and targeted investments in communities– and not just the use negative screening.  It focuses on excellence in how advisers and investment managers work, not condemning others.  It is an effort to avoid the risk of those in the field becoming what author Larry Osborne describes as “Accidental Pharisees” in his book of the same name.  This movement in biblically responsible investing, along with generational attitudinal trends, creates opportunities for those embracing these trends, and for those in the socially responsible investing field.  Common goals can be accomplished by focusing on shared perspectives that remain a minority viewpoint on Wall Street.  There is an opportunity of bridging a great divide.

History of Values Investing

It should not come as a surprise that the similarities between SRI and BRI are much greater than the differences.  The concept of utilizing personal values in the decision making process for investing has existed for much longer than the current movements and the various terms that have been coined to formalize the process.  Since personal values are usually developed based on a person’s faith, the integration of faith with investing is intertwined in our society whether we formalize it in our decision making process or not.  The idea of Christian faith impacting wealth and the use of wealth goes back to the beginning of Christianity.

More practically, faith based investing began as a formalized practice over 200 years ago when used by the Quakers and Methodists.  The first use of what we could call Biblically Responsible Investing was to restrict investing that supported human trafficking, which at the time was the legal slave trade.  Methodist founder John Wesley is also credited with raising awareness and building credibility for socially responsible investing, most prominently in a sermon entitled “The Use of Money”.  In it, he outlined some of the ideas that remain the basis for both Socially Responsible Investing and Biblically Responsible Investing.  At that time, the focus was on excluding  businesses with practices would harm others, and the avoidance of industries that were considered detrimental to society.

Over time the concept of social justice became part of the fabric of faith based investing, socially responsible investing became a more accepted term, and the movement began to shift away from the religious origins and toward a more secularized foundation, though this approach continues to retain many of the concepts that Christians and other people of faith would still support.

Over the last 20 years, a new variation of faith based investing has grown from an evangelical base.  In part, this stemmed from the trend of SRI towards a less religious orientation, but it was also an example of meeting a market need.  Some Evangelical Christians did not feel they had adequate investment options available through SRI, particularly with respect to some social screens that were viewed as a priority.  In some cases, the very social perspectives that evangelical Christians sought to sought to reflect in their investments directly contradicted those that were priorities for many socially responsible investing approaches.  These differences—though far fewer than many might expect—have formed a perceived “great divide” between BRI and SRI philosophies and proponents as values-driven investment options have exploded in number over the past decade.

Defining Faith Based Investing

The definition of Biblically Responsible Investing (BRI) used and promoted by the Christian Investment Forum (CIF) remains purposefully broad.   While there are some examples of the term BRI being narrowly used for only a specific set of criteria for investing, the use of the term BRI by the Christian Investment Forum is broad and is interchangeable with other similar terms used by investors who incorporate Christian faith into the investing process.  Those include Faith Integrated Investing, Morally Responsible Investing, Stewardship Investing, or Values Based Investing.

In this broader scope, Biblically Responsible Investing is a term used to describe an approach to investing assets in a way that is in alignment with the investor’s faith and biblical beliefs.  The definition that CIF uses is as follows:

“Biblically Responsible Investing, or BRI, applies Christian values to investment decision making by incorporating moral and social principles into traditional financial analysis.  BRI provides a platform for the faithful stewardship of God’s gifts on the basis of our shared Christian faith.  BRI seeks to invest in and own companies that best represent those Christian values.” (Editor Note: this has been updated since original publication)

By defining BRI as an approach that seeks to align investments with the investor’s faith and biblical beliefs, BRI is by definition a personal process.  While Christians share core foundational beliefs, it is also true that on many topics personal faith perspectives will lead Christians to differing opinions and, more importantly, differing priorities.  This makes it difficult to place a simple label or definition on what BRI is and what it is not, or how it is applied into the investment decision making process.   This diversity in how investors apply BRI is similar to what practitioners of SRI struggle with in defining their approach to investing.

The similarities between Faith Based Investing and Sustainable Investing are much greater than the differences.  Both seek to incorporate additional factors into investment decisions beyond a purely quantitative financial assessment.  Some on both sides believe this can provide superior performance, while others on both sides believe it is appropriate to address issues they believe are important in society regardless of the performance issue.  The similarity becomes even more apparent if we use the description of SRI from USSIF: the Forum for Sustainable and Responsible Investing but add one single key phrase (italicized bold to highlight).

“What unites these diverse investment approaches – and what ultimately distinguishes them from the broader universe of assets under management in the United States – is the explicit incorporation of environmental, community, societal or governance issues viewed from the Christian faith into investment decision-making, fund management or shareholder engagement activities.  The specific ESG factors and the way they are used may differ widely from investor to investor, and tactical and technical considerations are often specific to an institution or fund manager. ”

It is reasonable to say that Faith Based Investing largely mirrors Sustainable Investing, except that the lens used to consider criteria such as environmental, social, corporate governance, and company industries is a lens of religious faith and the values that flow from that faith.  That lens is key in understanding the purpose for which the investment is made, and in determining which  values play a role in guiding investment selection.

An Evolving Professional Investment Process

Faith Based Investing and BRI has continued to evolve over the last 20 years, as more practitioners have formed firms and more investment options have become available.  Most notable is the breadth of approaches to BRI.  Each firm and fund manager develops an investing strategy that aligns with their faith and values, but that is also based on the core principles of professional investment management.  Social issues that have become polarizing do remain a part of the criteria for some, but just as many funds also prioritize shareholder governance issues, inclusionary screening, or best-in-class selection parameters.  Some examples:  Praxis Mutual Funds, from the Mennonite Church, is an active participant in Green Bonds through the Praxis Intermediate Income Fund (MIIAX) , and a vocal advocate for the environmentally-focused faith value of “Creation Care”.  Epiphany Funds comes from a Catholic perspective.  Epiphany offers some specialty funds, such as a Latin America Fund, and takes an active role reviewing proxy materials internally and voting based on their faith values.  Eventide Funds doesn’t fall under one particular denominational label, but instead blends evangelical and mainline faith values.  Eventide has developed a concept known as Business360, which uses many of the themes familiar with socially responsible investing and re-aligns it with the positive religious convictions that were a foundation of SRI.  Business360 is a framework that uses inclusionary screens, exclusionary screens, as well as other governance data points to value a company on more than the short-term bottom line profits.

15 years ago there were no more than 5 mutual funds that described themselves as BRI focused.  Today, there are at least 100 different mutual funds across 28 different categories that explicitly incorporate Christian faith values as one part of their investment process.  The performance of these funds, based on ratings from firms such as Morningstar, follow a similar distribution curve as the full universe of investment options, and closely align with the performance of Sustainable Investing funds.  With the number of funds and fund managers across sectors, there are also investment management firms (Aris Corporation & Camelot Portfolios, for example) that research and create diversified portfolios of BRI funds for clients through separately-managed accounts.

Becoming Friends in Mission

The reality in the financial industry is that the common goals of both BRI and SRI remain a minority view on Wall Street, as well as with many institutional investors and advisors.  One of  the common goals of both approaches is to establish the credibility of incorporating ESG factors into stock selection and outperformance, whether those factors are included based on faith values or secular social ideals.

For an agnostic investor, investing in GuideStone Extended-Duration Bond Fund (GEDZX), Eventide Healthcare & Life Sciences Fund (ETNHX), or other BRI funds can be just as impactful to their social goals as any other SRI fund, and deliver outstanding financial performance in the process.

For an evangelical investor, investing in funds such as Calvert Global Alternative Energy Fund (CGAEX) or Pax EllevateGlobal Women’s Index Fund (PXWIX), among others, can diversify a portfolio while not necessarily violating their own faith convictions.

In his book, Uncommon Decency, Richard Mouw describes what is needed if we are to focus on common goals between SRI and BRI.  He writes, “…one of the real problems in modern life is that the people who are good at being civil often lack strong convictions and people who have strong convictions often lack civility….We need to find a way of combining a civil outlook with a ‘passionate intensity’ about our convictions.  The real challenge is to come up with a convicted civility.” Through convicted civility perhaps we can remain friends in mission.

CONCLUSION

There increasingly is no great divide between BRI and SRI.  There are differences, to be sure, in some values, convictions and priorities.  The reasons for investment decisions may be different.  The real divide, however, is with those that don’t take any values or convictions into account when investing and instead seek only to maximize value regardless of the harm that may be caused.  Not only is that short-sighted, but research is finally proving that maxim is faulty as well.

Article originally posted here by Access Ventures

by Mallory Sanborn (Access Ventures)

There are 54 million empty bedrooms in the United States, and because boomers are aging and more and more become empty nesters each year, the number of empty bedrooms in the homes of the elderly population is at an all-time high. One-third of the housing stock in 2035 will be home to people over 65, and half of those will be single-person households.

We are also in a housing crisis. Almost half of all U.S. renters pay too much on rent— leaving less income for food, transportation, education/child care, and savings. What if, instead of letting those rooms sit vacant, we were creative with that space? Only 2% of people over the age of 45 are renting out space in their homes and according to AARP, 40% of that population is interested in renting out space in their home but are not.

Nesterly is an easy way to find a trusted tenant for over 30 day stays. “Most of the community we work with are empty nesters and retirees who have a spare bedroom in their homes and delight in the idea of sharing their home with a young person, like a college student while also making some extra monthly income” says CEO and Founder, Noelle Marcus. Nesterly is solving multiple problems with one solution. Many elderly people want to age in place but often cannot afford to do so or they become lonely which can have a negative impact on one’s health. 90% of adults want to age in their current homes but fixed and limited incomes, increasing home maintenance costs, rising property taxes and declining social networks are all barriers that keep them from being able to do so. Nesterly addresses each of these barriers as well as those the young person looking for an affordable place to live is facing. Student debt has climbed to an all-time high of $1.5 trillion in the United States, and there is an alarming rise in food insecurity on American campuses. Decreasing housing costs for students is one way to offset the student debt crisis our nation is facing.

Noelle Marcus started Nesterly because she and her family have witnessed how difficult it can be to access affordable housing. She learned about the desire many aging adults have to stay in their homes but the economic, social and physical challenges to doing so, the solution of Nesterly seemed like common sense.

“I was far from home, and being halfway across the world can be an isolating and lonely experience.”

Lawson, Nesterly User

Using the Nesterly platform, an elderly couple living outside of Boston, MA has opened their home to Lawson, who moved to Boston from Australia to conduct clinical research at Massachusetts Eye and Ear Hospital. They have been home-sharing for over a year now. “I was far from home, and being halfway across the world can be an isolating and lonely experience.” says Lawson. The isolation he was feeling and the unimaginably high housing costs in Boston, made Nesterly a perfect fit for Lawson. In addition to providing a home away from home for Lawson, Bettina and her husband also receive an extra set of hands around the house. “I expected that the guests that we have found through this program were going to help, but I didn’t expect the connection we were going to make.”

Another Nesterly user, Brenda who wants to age in her home was struggling to pay her utility bills and save for home repairs, finding Abby has not only allowed her to make some extra income but the two have become good friends and enjoy cooking together. The intergenerational aspect of Nesterly’s product is unique and therefore the outcomes are unique. It leads to a deeper understanding of people who have different experiences, which ultimately leads to more empathy.

Noelle and the team at Nesterly embody empathy. While businesses and individuals have been struggling to maintain normal during the COVID-19 pandemic, Nesterly immediately jumped into action mode. They created a platform called Nesterly Good Neighbors which allows elderly and more vulnerable people to submit tasks such as picking up a prescription or getting groceries and then trusted volunteers can claim a task and complete it. “We decided intergenerational home-sharing and actively pursuing new users needed to be temporarily paused in light of COVID-19,” Noelle said, “but we have this team and this platform that primarily serves people over the age of 55 and we were already providing a matching service based on needs.” Seniors have been calling and asking for things and needing support from their local governments and service providers. As Nesterly began to understand the challenges people were facing because of COVID-19, the team made a quick decision to build a tool to provide support. “We knew the Nesterly population was particularly vulnerable and we wanted to continue to serve and be helpful to this population.”

Seeing this company act in such a way that served their target population beyond their primary platform, even if it meant late nights of product development and working hard amidst all the changes and uncertainties has made us even more aware of the team’s heart for what they do and the work ethic behind it.

We are proud to have Nesterly as recipients of our Reconstruct Challenge grant program and are excited to continue to watch them serve communities all over the U.S. As part of the Reconstruct Challenge, Nesterly is launching its primary platform as well as Nesterly Good Neighbors in Louisville, Kentucky. Learn more about Nesterly here.

This excerpt is taken from the book “Distinctives and Challenges of Business as Mission”

by Neal Johnson & Steve Rundle

by Steve Rundle

The speaker was in some ways a caricature of globalization — an Iranian-born citizen of Canada, educated in the U.S., and now working in China alongside her American husband. In 1993, before an audience of about 19,000 college students, “Mary” shared the following story:

[M]y husband and I traveled to a remote place in China — we went as far as the airplane could take us, and then on by train. That evening as we strolled down the street we stopped at a little sidewalk restaurant to eat. Knowing that we were foreigners, the people eagerly crowded around us and began saying, “Coca Cola. We like Coca Cola.” We asked them if they had ever heard of Jesus? After some murmuring they answered, “No, no one had ever heard that name.” In anguish, I wondered why Coca Cola had gotten to this area, and after 2000 years, Jesus had not?

Her story illustrates the remarkable capacity of business to reach people virtually anywhere in the world, including places where the gospel still struggles to gain a foothold. It also helps explain why well-known evangelicals such as Billy Graham, Henry Blackaby and Wayne Grudem are focusing more of their attention on the heretofore neglected role of business — and those who run them — in mission. This increased attention is part of an even broader movement, perhaps the first great missionary movement of the Twenty-First Century, in which laypeople from every profession are discovering, or rather, rediscovering, their role in missio Dei. That role goes beyond financial support, service on church committees and prayer, and extends into areas that were once thought to be the exclusive purview of professional missionaries.

“Tentmaking” are all being used, often synonymously, to describe what in our view are separate strands, or camps, within a single movement. They are closely related in that all start by emphasizing the “priesthood of all believers” (1 Pe 2:9-10) and the idea that mission, properly understood, is something all Christians are called into. They all promote the intrinsic value of work, and claim that the distinction often made between sacred and secular vocations is not only unbiblical, but is counterproductive to the completion of the Great Commission.

Article originally posted here by Eventide

by Shaun Morgan

Profit is a necessary condition for a business to operate, not a sufficient purpose for its existence. 

Let me explain.

To mistake a business’s need for making a profit for its purpose is actually illogical. Charles Handy, recognized as one of the leading business management thinkers of our time, puts it this way in his Harvard Business Review article, “What’s a Business For?”:

We need to eat to live; food is a necessary condition for life. But if we lived mainly to eat—making food a sole or sufficient purpose of life—would become gross. The purpose of a business in other words is not to make a profit, full stop. It is to make a profit so that the business can do something more or better.1

Profit generation is a lagging indicator of the demand for the product or service that a business is offering combined with the business’s ability to effectively produce and deliver that product or service to its customers. 

Generally, the current or future profit that is generated by a business is a key metric in determining its “value.” Profit and value, however, can be achieved by good or bad means—a business can become profitable by creating value for or extracting value from its neighbors.  

To be clear, a business’s neighbors are best understood as its stakeholders:

• Customers

• Employees

• Suppliers

• Host communities

• The environment

• Broader society

What Is Right Is What Is Smart

It is easy to see how creating value for stakeholders is the right thing to do, but more research and evidence is showing that it is also the smart thing to do, highlighting the reciprocal relationship between a business’s success and the success of its neighbors. 

In other words, while many today tend to see a company’s stakeholders as those who are affected by business, what’s often overlooked is the effect that stakeholders have on business.

Edward Freeman, business professor at Darden School of Business, one of the leading thinkers and promoters of what is known as “Stakeholder Theory,” describes the theory in these terms:

The 21st Century is one of “Managing for Stakeholders.” The task of executives is to create as much value as possible for stakeholders without resorting to tradeoffs. Great companies endure because they manage to get stakeholder interests aligned in the same direction.2

With this in mind, business professionals and academics alike are dedicating research to exploring how each of a business’s stakeholders impact the future success of the business. 

Customers and Employees

Fred Reichheld, for instance, explores the reciprocal relationship between a business and its customers in his book, The Ultimate Question. He has this to say about his findings:

Too many managers have come to believe that increasing [profits and shareholder value] requires exploiting customer relationships. So they raise prices whenever they can. They cut back on services or product quality to save costs and boost margins. Instead of focusing on innovations to improve value for customers, they channel their creativity into finding new ways of extracting value from customers.

In short, companies regard the people who buy from them as their adversaries, to be coerced, molded, or manipulated as the situation permits. The Golden Rule—treat others as you would like to be treated—is dismissed as irrelevant in a competitive world of hardball tactics. Customers are simply a means to an end—fuel for the furnace that forges superior profits. This view is utter nonsense. Companies that let themselves be brainwashed by such a philosophy are headed into a sinkhole of bad profits, where true growth is impossible.3

Reichheld’s research was conclusive. Companies that failed to delight their customers, seeing themselves instead as in a “win-lose” relationship with their customers, were far less likely to grow at the same sustainable pace compared with a company focused on creating value for their customers.

In a similar vein, Zeynep Ton provides deep research on the correlation between a company’s success and how it invests in its employees. In her book, The Good Jobs Strategy, she focuses on how low-cost retail stores treat their employees. 

She recounts how companies whose primary focus was on reducing labor budgets resulted in a vicious cycle of low-quality and/or quantity of labor, which then produced poor operational execution, which resulted in low sales and profits, which caused labor budgets to be reduced even more, perpetuating the cycle. 

On the other hand, she observed how companies displaying sustainable growth in sales and profits did so by investing more in their employees through what she calls “the good jobs strategy”—a strategy that prioritizes paying for quality training, respectable wages, and effective operating procedures.4 

The late Herb Kelleher, cofounder and former CEO of Southwest Airlines, known for aiming to provide the best jobs in the airlines industry, described his strategy this way:

Your employees come first. And if you treat your employees right, guess what? Your customers come back and that makes your shareholders happy. Start with employees, and the rest follows from that.5

The Essential Question

That the long-term success of a company is impacted by how its stakeholders are treated is inescapable. And this brings us to the essential question concerning the true purpose of business: If profit is merely a necessary means to accomplishing a more sufficient purpose, what is that purpose?

It is, in the words of Jeff Van Duzer, the former dean of the business school at Seattle Pacific University, “to provide a community with goods and services to enable it to flourish [and to] provide people with opportunities for meaningful work.”6

Put simply, a good business loves its neighbors. It just so happens that loving your neighbor is also good for business.

—

Notes

1. Charles Handy, “What’s a Business For?” Harvard Business Review (Dec 2002), accessed June 29, 2020, https://hbr.org/2002/12/whats-a-business-for.

2. Edward Freeman, “About,” StakeholderTheory.org, accessed June 30, 2020, http://stakeholdertheory.org/about/.

3. Fred Reichheld, The Ultimate Question (Cambridge, MA: Harvard Business School Press, 2006), 175.

4. Zeynep Ton, The Good Jobs Strategy (Boston: Houghton Mifflin Harcourt, 2014), 15.

5. Herb Kelleher, BrainyQuote.com, accessed July 6, 2020, https://www.brainyquote.com /authors/herb-kelleher-quotes.

6. Jeff Van Duzer, Why Business Matters to God (Downers Grove, IL: InterVarsity Press, 2010), 42.

by Cornerstone

During this season where the Cornerstone team cannot work from the same office, we have been considering how we ensure that the benefits of physical proximity are not lost in our new virtual work environment. 

First of all, we are taking it for granted that the online setup is good, with an ability to conduct effective online team meetings, share documents, allocate tasks, and basically get stuff done. Most organizations have IT systems in place to allow individuals to work remotely. Cornerstone is no different, it fortunately had invested in putting good systems and a positive culture in place around how it uses technology and cloud-based solutions.

However, we had been using those systems for the most part in our physical office and spent at least 2 days a week in the office together.

As those physical interactions have now been eliminated completely we identified what we were missing in our new remote working situations.

Camaraderie & Vulnerability

The physical office created opportunities for two key things that are essential for a positive working experience.

Camaraderie: In the office there are opportunities to chat throughout the day. Catching up on news, laughing together, sharing updates on family life and knowing what’s going on at work. Those interactions are essential to maintain positive relationships within a team.

The solution: Virtual Catch Ups – Twice a week Cornerstone spends the first 30 mins of the day chatting with each other, sharing work-related updates and encouraging each other. Having that intentional time has been brilliant and something we will continue after this season.

Vulnerability: It’s essential within a business that team members are able to share challenges with each other. In-person these issues can be mentioned as situations arise, or our colleagues can see how our mood and mannerisms have shifted and they can ask. 

The solution: Daily Celebration / Challenge Update: As a team, we share a celebration and challenge with each other every day. This routine has allowed us to share the issue that has been challenging us most as they arise. The team has been remarkably candid, more so than we would have been in the office. This has allowed us to support each other better and to be accountable for the issues that are difficult.

These two small, simple ideas have been really powerful for Cornerstone and we hope they may be valuable for you as well!

Cornerstone is a purpose-driven business that seeks opportunities to transform its city by developing property and building community. It does this alongside its investors by giving them great returns and an opportunity to partner in its mission. What Cornerstone is doing is pioneering, it has not been done before in our country and we need support to claim this ground.

WE LOVE BELFAST

For more information see www.cornerstoneni.com

FOR MORE INFORMATION ON COVID-19, PLEASE SEE OUR PAGE HIGHLIGHTING SOME OF THE BEST RESOURCES OUT THERE FOR FAITH DRIVEN INVESTORS & ENTREPRENEURS IN THIS SEASON.

Article originally posted here by KNGDM Group

by KNGDM Group

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