Faith-based investing is becoming more and more popular. Cancel culture continues to metastasize. Christians should support and invest in companies that reflect Biblical values. How does one effectively develop a faith-based investing approach?
Faith-based investing strategies align profits with convictions, beliefs, and values. Investors conduct due diligence on potential companies and discard businesses in violation of their convictions. Faith-based investing is challenging and requires intense scrutiny and patience.
It’s not as cut-and-dry as one might think.
Is it possible to design a faith-based investing strategy? Are there other ways to engage a company other than simply disengaging? Should a Christian even bother?
Let’s dig into this idea!
Socially Responsible or Value-Based Investments
We all have tribes. Social justice warriors (SJWs) have their tribes and Christians have their tribes. Sometimes, sub-tribes are developed as well.
Mutual funds and exchange-traded funds have been created to meet this sub-tribe demand. There are funds available that promote various types of diversity. Some funds focus primarily on environmental, social, and governance (ESG) issues. Imagine a tribe and there is probably a matching investment.
Christians, as usual, are following suit and mimicking their secular counterparts. Many companies now offer Christian mutual funds. These funds are supposed to invest resources in companies that align with Christian values.
How does one decide which Christian values, though?
Faith-Based Investing — Why?
Corporate America is experiencing an epidemic of corruption. Companies such as Starbucks, Walt Disney, Amazon, and JP Morgan all now pay for employees to travel to obtain abortions.
Does that conflict with your values or convictions?
Many Christian families pulled the plug on Nextflix a few years ago. It took some time for Netflix to feel the pain but the shot landed squarely. Netflix revenue has deteriorated.
Christians have every right to choose where to spend their hard-earned dollars. Helping an ungodly company succeed runs counter to our Gospel proclamations.
What about investing in a company, though? Should Christians avoid investing in companies that are not aligned Biblically?
Is partial ownership better or worse than patronage?
Christians typically don’t want to be identified with companies that murder babies, promote the sexualization of children, or encourage alcoholism. Profiting from illicit or even questionable activities should at least be questioned.
We’re warned about exploiting the poor in Proverbs 22:16.
Evaluating our investments through the lens of Scripture is wise.
It’s a difficult process though.
Faith-Based Investing — Who?
Should every Christian initiate a faith-based investment strategy? Christians should be aware of the companies they own.
Proverbs 27:23-24 Know well the condition of your flock, and pay attention to your herds, for wealth is not forever; not even a crown lasts for all time.
The Holy Spirit convicts us of sin, righteousness, and judgment (John 16:8). If you feel convicted over the companies that you own then you should complete some enhanced due diligence.
Many of my stock-trading friends invest in a company named Altria Group. This company pays a huge dividend and most are earning a good return. This one is a “hard no” for me, though.
Why?
Altria was at one time known as Philip Morris. Philip Morris is a tobacco company. I have zero interest in being paid a return on an addictive product that is known to cause cancer.
I’m reluctant to invest directly in pharmaceutical companies as well.
These are my convictions.
Are you considering investing in individual stocks? Before you do please check out this article that I wrote about diversifying investments.
Faith-Based Investing — Mutual Funds & ETFs
Knowing all of the stocks inside of a mutual fund would be difficult. One of my funds has 116 different companies in it. I am familiar with the top ten but that’s about it. Most of my other ETFs or mutual funds have several hundred different companies inside of the fund.
It would virtually impossible to determine the faith-based attributes of each of these companies.
Some companies go to market at Christian mutual fund companies. Are those safe?
I would find it challenging to be all things for all people.
Catholics, Lutherans, Anglicans, and Presbyterians are fine with the consumption of alcohol. Baptists, Wesleyans, and Charismatics, at least in public, refrain from the consumption of alcohol.
Is a Baptist-faith-based mutual fund needed?
The Timothy Plan offers pro-life and pro-family investing options. These funds are actively managed so the fee structure will be higher. For those who want to ensure their investments are fully aligned with the Bible, this is a great option.
The Slippery Slope of Faith-Based Investing and Shopping
Demanding full Biblical alignment for everything we purchase would be problematic. The majority of banks are now woke. Banks celebrate alternative lifestyles and even fund drag shows where kids are taught to pole dance.
Where does one draw the line?
Staunch Baptists are adamantly opposed to drinking booze (are you curious what the Bible states about drinking booze?). Most would not invest directly in Diageo. Diago is the global distributor of Scotch, rum, gin, and beer.
That stock is off-limits. It might even cause a person to reject a mutual fund with that stock.
However, one of the faith-based mutual funds had Costco as one of its key components. Costco sells a ton of booze each year.
Where do we draw the line?
Do we shop at Costco but not buy their stock?
Raise Some Caine
Shareholders have every right to be a thorn in the side of the management team of a public company. Will it make a difference?
Perhaps.
ESG tribes and SJWs have used their influence effectively. Christians could do the same.
What’s stopping you from Raising Caine with the management team?
Allow God’s Peace to Guide You
Do what you must when it comes to investigating stocks and mutual funds. If your conscience has been pierced address it with God in prayer.
Do us all a favor, though. Resist designing a doctrine around your convictions.