Biblically Responsible Investing — Reaching for your long-term financial goals without sacrificing your conscience (July 2023)
The way you use your wealth impacts the world around you. It’s important to practice good stewardship of your resources and apply biblical principles to wealth management.
That includes being conscientious of how you’re spending your money and giving generously to charitable causes. It can also mean investing wisely and in companies that do good in the world.
Biblically responsible investing (BRI) is a way to earn a return on investments that align with your personal convictions. It’s a way to deploy capital for both financial returns and spiritual returns. And as a movement, it’s gained prominence in the past decade or so, with more and more BRI fund families becoming available for faith-conscious investors to grow their wealth in a way that fits their values.
Values-Based Investing is Older Than You Think
Although BRI has been talked about a lot in recent years, it is not a new concept. In fact, faith-based investors can trace their roots back to the Methodist preacher John Wesley, who delivered an influential sermon in 1759 titled “The Use of Money.”1 In his sermon, he shared this advice: “Gain all you can, save all you can, give all you can.”
Wesley specified that wealth should be gained through “honest industry…without hurting our neighbor in soul or body.” Because businesses directly impact the lives of other people, such enterprises and their investors should think about more than profit. Financial advisors can help guide you toward funds that will allow your investment dollars to be a tool of societal good whether your priorities are spiritual, ethical, or ecological.
After all, investing is a form of ownership. When you buy stock in a company, you become a minority owner in that business, and you share in its risks and profits. If you were to purchase a company, you would want it to reflect your values and priorities, or at least not work against them. Shouldn’t the same principles apply when investing?
Investing as Good Stewards
“The earth is the Lord’s, and everything in it.” — 1 Corinthians 10:26
“Whatever you do, do it all for the glory of God.” – 1 Corinthians, 10:31
We are all managers of the resources God has entrusted to us. If our earthly riches ultimately belong to God, we should practice good stewardship of those resources by using our money in a way that brings Him glory. It’s at the heart of biblically responsible investing.
BRI is a proactive approach that seeks to maximize returns while maintaining alignment between financial investments and biblical values. To this end, these funds employ a three-pronged investment strategy:
- Avoiding investments that cause harm
- Affirming investments that do good
- Advocating for corporate responsibility through shareholder engagement
BRI mutual funds screen out so-called “sin stocks,” or companies that profit directly from human suffering. These are industries like gambling, alcohol, tobacco, abortion, and pornography. At the same time, the funds seek out companies that are doing good in the world as a way to invest in human flourishing.
Some Christians are surprised to learn that this is an option. Others may be concerned that investing in a biblically conscious way might affect their returns. However, recent research suggests that adopting a faith-based approach to investing does not diminish potential returns. According to Bob Doll, Chief Investment Officer of Crossmark Global, “Over 20 years of investment history shows us that values-based investing does not mean sacrificing performance.”2 Of course, past performance does not guarantee future results.
Biblically Responsible Investing Options at JMA
John Moore Associates has been using BRI mutual fund allocation models with clients for just a few years now, but we are excited about this investment option. There are enough biblically conscious funds to allow us to put together a comprehensive investment strategy using only mutual funds that employ BRI screens. These faith-based portfolios are still broadly diversified but allow individuals to invest with a clear conscience.
In addition to investing with BRI mutual funds, JMA also has individual stock models where we build portfolios of approximately twenty individual stocks that have all been screened for financial value first, with BRI screens applied to the curated list. The goal is to provide a quality investment strategy that could yield a return clients would feel good about, both financially and spiritually.
The best resource for information on faith-based investing is a financial advisor who holds both CFP® (CERTIFIED FINANCIAL PLANNER™) and a CKA® (Certified Kingdom Advisor) certifications. This ensures a balance of fiduciary duty and biblical wisdom.
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REFERENCES:
1 – Wesley, J. (1759) The Use of Money. Reprinted by Discipleship Ministries. [link= https://www.umcdiscipleship.org/articles/the-use-of-money-by-john-wesley]
2 – Doll, B. (2021) The Tall Tale of the Trade-Off, Crossmark Global Investments. [link=https://www.crossmarkglobal.com/2021/12]