How we can change the way our money is used in the current crises we face

June 15, 2020

  

The current Coronavirus pandemic has awakened us to the frailty of our accepted social and economic norms. Prior to it, though, the accelerating global warming crisis should have alerted us to the danger of continuing in the way to which we have become accustomed in ‘developed’ countries, especially over the last 40 years.

 

Our Wessex Synod Church and Society group at its last meeting expressed its concern that, as Christians, one way in which we should be responding is by (re-)considering how our  money is contributing negatively or positively to such ethical issues.

For the importance of the issue of the abuse of money we should recall Jesus’s response: Matt.21:12.

 

Jesus entered the temple courts and drove out all who were buying and selling there. He overturned the tables of the money changers and the benches of those selling doves.

 

 

An article entitled ‘Unholy Assets’ by Symon Hill, in the Christian magazine Third Way in 2014, found nearly all denominations guilty of hypocrisy over their expressed Christian ethical values and concerns compared with their actual corporate investments.

An example which hit the news was the Archbishop of Canterbury’s attack on ‘loan shark’ companies exploiting the poor – and then discovering that the Anglican church had shares in the company to which Wonga belonged!

The author commented that we may call for disinvestment in fossil fuel companies, whilst it is still virtually impossible to live without their products, as our society is currently built around them. We are all complicit in the injustices of the economic system by which we live.

 

Shareholder constructive engagement with companies can be effective where their activities are not intrinsically unethical, but cannot work with companies whose core purpose is deemed unethical. Hence many churches rule out investment in companies majoring on arms sales, pornography, gambling, animal testing, tobacco and alcohol sales – and arguably fossil fuels also now, in view of the climate crisis caused by their use.

 

The ecumenical Christian charity Operation Noah is campaigning for all churches to divest from fossil fuel companies, as our Wessex Synod has recently done, and the Nuclear Weapons Financing Research Group are looking for support on that issue. Positive investment is also important eg in companies developing health care and renewable energy.

Probably relatively few of us have direct investments in individual companies, but most of us have indirect investments, via our bank and savings accounts, insurance companies, pension funds and possibly through unit trusts or stocks and shares ISAs. ‘Ethical’ investment options have been available for about 35 years now, but natural human inertia and caution have inhibited many of us from acting on our Christian principles in this regard.

 

One concern of investors is that, by restricting the range of companies invested in,  financial return might be com-promised and risk increased. However, a counter argument is that companies which have a good ethos and ethical decision making will in the long run perform better, through greater productivity from more motivated employees and by avoidance of the financial and reputational risks from socially or environmentally damaging activity.

 

There is now ample evidence that the latter argument is the stronger – ethical funds have performed better over 5-10 year periods than their non-screened equivalents. This should encourage even the risk averse of us to consider switching to them, on financial as well as moral grounds.

 

However, one must recognise that it is inevitably a case of ‘shades of grey’ rather than ‘black and white’, and there are differences in both ‘ethical purity’ and performance between the ‘ethical’ companies and funds.

The advice of a specialist ethical Independent Financial Advisor(IFA) is recommended if substantial funds are to be invested. I personally am greatly indebted to the Ethical Consumer magazine and Ethical Investors for their comprehensive research and long established commitment and expertise, and would be happy to be contacted for further discussion of my personal experiences in this area.

 

So, what can we do?

  • We can consider moving our bank account to a more ethical alternative eg Co-op, Triodos or a Building Society (easier now than it used to be), and savings account eg to Shared Interest (enabling Fairtrade)

  • Change our insurance and utility companies – some are definitely more ethical than others

  • Express our ethical concerns to our pension provider, if we have no choice of same

  • Invest only in ‘Ethical’ funds, preferably those that have divested from fossil fuel companies and those actively promoting sustainability rather than just negatively screening.

 

References:

URC    

ECCR (Ecumenical Council for Corporate Responsibility)     NWFRG (Nuclear Weapons Financing Research Group)   

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