“Profit or Principles: Investing without Compromise”, by Dwight Short

Used by permission

 

The following story is an excerpt from the book Profit or Principles.  It is the conclusion of a story about a couple and their journey through the decisions about investing and their faith.  As investors, we each have the opportunity to direct how we’d like our assets to be managed.  As Christians we should acknowledge that we don’t actually own those assets, God does.    If you’d like to learn more about the book, visit our Book review page here.

 

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Todd’s hope was that Elise would join him on the visit to their financial planner to discuss changing the focus of their investments. However, Sarah and Chris­topher were back from their honeymoon and Sarah wanted to spend the day shopping with her mom. Ap­parently exchanging wedding gifts and spending the day with her daughter were more important than their investments. It wasn’t surprising since Todd took care of the majority of financial business for the family.

Wallace Burke had all the trappings of success. His professionally styled office suite was located on the third floor of the Overton Bank Building in the heart of the city. The polished tile floor in the hallway led to an oversized mahogany door with silver-plated hard­ware. Once you stepped inside, the carpet was plush, the furniture was rich, and the colors were subdued. Margaret, a woman appearing to be in her 50’s and al­ways dressed as conservatively as a grandmother, had been Wallace’s secretary for years and her voice was the first thing heard when entering the office suite.

“Hello Mr. Watson,” was her cheery greeting. She did not need to have Wallace’s calendar in front of her to recognize Todd. He had been investing according to Wallace’s financial advice for years and was probably his best customer. There was no need to sit, Wallace was ready and waiting in his office, so Margaret quickly escorted Todd as if he were a new customer.

Not being sure why Todd wanted the meeting, Wallace had all his paperwork in order, spread out on top of his executive-style desk. He and Todd liked each other, but they had never spent any time together out­side of their business relationship. Wallace was several years older and pretty tied to a quiet routine. No one would ever say that Wallace liked adventure or taking risks and he ran his investments like he ran his life–as risk free as possible.

Todd and Wallace exchanged the usual pleasant­ries. Margaret brought Todd a cup of coffee, just like he liked it, and they sat down to discuss the matter that brought Todd unexpectedly to the office.

“I know you’re curious about why I’m here,” Todd began. “First, let me assure you that it is not because I’m unhappy with anything you’ve done! Elise and I have been very pleased with the way you have handled the money. You have accomplished precisely what we asked you to do for us.”

The words provided a touch of assurance for Wallace but he was still waiting for something more. He knew Todd was not there just to pat him on the back. “We want you to continue managing our money,” Todd said, and Wallace hoped his sigh of relief was not visible. “It’s just that we want to change our approach,” Todd continued.

“Your investments have been doing very well,” Wallace replied, “Especially in this economy. I’m not sure we can do much better.” He was hoping Todd was not looking for a bigger payday that required riskier investments, that was just not Wallace’s strength.

“No, no, I’m not concerned about making more money. Elise and I have been thinking a lot lately about how our money is being used. Let me explain how this whole thing came up.”

Todd then took the next seven or eight minutes to describe the encounter with Robert Wells at church and how that turned into the conversation with his busi­ness partners and then the questions they had about all their money and what it was accomplishing. He also tried to explain how he had spent hours reflecting on Jesus’ story of the talents and his conviction that God was trying to tell him something about being a bet­ter steward. Wallace listened carefully. He was certainly interested in Todd’s way of thinking because good in­vestment advisors must know their clients and he al­ways prided himself on being able to provide what his clients wanted.

When Todd brought up the phrase, “Biblically Responsible Investing” that he had read about on the Internet, Wallace’s attitude changed. He was somewhat defensive toward this approach to investing. Making money in this volatile market was not an easy thing to do and Todd should be happy that Wallace is getting him a decent return. Now he wants to put some stipulations on how to invest and will probably be upset if he doesn’t make as much money.

“What do you know about investing like this?” Todd asked.

“I’ve studied it some, “replied Wallace hesitantly. “I’m not convinced it’s a good way to go.”

Somewhat surprised since he knew Wallace was a Christian, Todd pressed, “Tell me why, I’d like to know.”

“Probably my first concern is the financial loss you will experience, or at least the financial opportu­nity missed, by not investing in some very profitable companies, just because we don’t agree with everything they do.” This was always Wallace’s first comment when asked about BRI even though he didn’t know of any evidence to prove it was true. It simply makes sense; if you avoid certain types of companies then you will likely miss some good opportunities.

Todd was expecting this objection since he had done his homework prior to the meeting. “Just because a company avoids questionable activities doesn’t neces­sarily make it less profitable does it?” he asked.

“Not necessarily,” agreed Wallace, “But if we change our investment habits just to avoid some of these issues, we might take a hit on your returns and that would not be good stewardship either.” Keeping his investments separate from his religion seemed like a good policy to Wallace.

Sensing that Todd was not convinced, Wallace continued. “Besides, you know how difficult it is to determine exactly what companies are doing. A company that primarily makes dog food might have some secondary interests in tobacco or alcohol, or a computer company might hold ownership of a casino. I don’t know if there is such a thing as a completely responsible company in today’s world. Besides, I think this might just be a fad that will disappear in a short while. You know how investment fads come and go all the time.”

“This is more than a fad with me, I really think this is something I want to consider. I know it’s not easy,” Todd said, trying to keep his aggravation toward Wallace’s attitude from coming through his voice. “But it’s important enough to me that I want to give it a try. What do we need to do to get started?”

“Like I’ve always said, I work for you,” Wallace quickly chimed in once he realized Todd was commit­ted to this new approach. “Give me a few days to get some information together and then we can meet and make some decisions.”

“Great!” said Todd. “I’m ready as soon as we can get started.”

They spoke a few more minutes, making plans to meet in exactly one week to formulate a plan. Todd was not totally pleased with the conversation but he was willing to give Wallace an opportunity. He had earned that much since he had been a good advisor for many years.

On the way out of the office, Todd spoke to Mar­garet, “I’ll see you next week.”

It was a short walk to the parking lot and just as he reached out with his left hand to open the car door, Todd’s phone rang. As he had done countless times before without having to think, Todd reached into his pocket, pushed the answer button as he lifted the phone to his ear and said, “Hello.”

“Todd, this is James,” and then a very brief pause. “How are you doing?”

Without even looking at the caller id, Todd recog­nized the voice as James Adams, his pastor and good friend. He and James had been friends for more than six years, since James first came to the church as pastor. They were about the same age, both shared an inter­est in old cars, occasional fishing trips, and their wives were good friends. Put all that together with James’ in­terest in Todd’s spiritual growth and a close friendship developed.

Todd had already spoken with James about his interest in BRI. It came up in a conversation after dis­cussing James’ sermon on the parable of the talents. James knew a little about the subject. Obviously he did not have the money to invest like Todd, but he did keep a close eye on his retirement funds, which were managed by a Christian ministry that specialized in helping pastors.

“I’m good! Todd answered. “I’ll bet with this weather you are wanting to plan a fishing trip.”

“I would love to go fishing, but it’s not gonna happen today. Hey, I called your office and they said you didn’t have anything scheduled for lunch. I’ve got a proposition for you.”

Both men enjoyed having lunch together but they were both too busy to make it happen often. “I’ll tell you what, Todd responded, “name the place and I’ll buy. How’s that for a deal?”

“I knew you’d say that. Let me tell you what I have in mind. I’m having lunch with the man who handles my retirement account. After our conversation last week I thought you might want to meet him and pick his brain a little about responsible investing. What do you think?” asked James.

“That’s a great idea James, perfect timing. Tell me when and where and I’ll be there.”

By the time the arrangements were shared Todd was in his car and driving out of the parking lot. He knew Elise and Sarah would be having lunch together so he was not worried about checking in. He had just enough time to make a couple of quick stops along the way to the restaurant.

The plan was to meet at Bronson’s out on Westridge Parkway not far from the church. Although it was a new place it was rapidly becoming a favor­ite for James and several of their other friends from church. It was clean, the food was good, and the prices reasonable, all good reasons to chose a restaurant.

Traffic was light so Todd suspected he was a few minutes earlier than planned. He scanned the parking lot for James’ car as he walked toward the entrance.

Confirming with the hostess that he was the first one there, he requested a table in the corner, hoping to be a quiet enough place to allow conversation. By the time the waiter took his order for a glass of water, Todd spotted James walking toward the table.

He stood up, grasped his hand firmly and said, “Hey friend, I’m so glad you called.”

“I’m glad you could come,” replied James. “Let me introduce my friend.”

Pointing to a tall, slender man in a light tan sport coat, James said, “Todd, this is Michael McDonald, he is the financial advisor I told you about.”

Todd and Michael shook hands and exchanged customary greetings. Todd said, “Thanks for including me in this conversation.” Turning toward Michael he added, “James has probably told you about my interest in Biblically Responsible Investing.”

“Yes, I was excited to hear about you. I’ve been trying to get the word out for several years but it has been difficult. Anytime I find a potential convert I’m like a preacher meeting a first time visitor at church.”

All three men chuckled at the comment and the waiter arrived at the table at the same time to take drink orders and explain the menu. James and Todd knew what they wanted and Michael took their recommen­dation so there was no need to spend time studying the menu options. With the lunch order out of the way they could get about the business of discussion.

“What is the hardest thing about encouraging people into Biblically Responsible Investing?” posed Todd. “Why are Christians hesitant to take this ap­proach?”

“I think the primary reason is that people don’t like change. The ones who should be most interested in this type of investing are probably the same ones who strive to be good stewards. Consequently, they are reluctant to do anything that doesn’t seem safe. They are making a little money by doing what everyone else is doing and most people equate that with being a good steward,” answered Michael.

“That’s exactly where I was until a few weeks ago,” chimed in Todd. “Elise and I were happy that we were making some money, we were giving our tithe to the church and trying to manage our money care­fully. Then I started reading Jesus’ story of the talents. I don’t know how many times I’ve read that story lately, but it won’t let me go. We’re convicted that we’ve got to do more.”

About that time their lunch arrived. The waiter carefully arranged the table and made sure each of the men were satisfied. Talking stopped for a few minutes to allow everyone to sample the food and get started on the meal.

Todd was the first to get back on subject. “How hard is it to switch over to Biblically Responsible In­vesting?” he asked.

“It’s not hard at all, not any more difficult than changing any investment in your portfolio,” Michael responded. “All you need is a financial planner who is willing to help.”

“That might be my problem,” Todd said with a hint of dejection in his voice. “I just met with my guy this morning about making some changes and I’m not sure he’s on board. I don’t think he’s opposed to the idea… just not confident in what to do.”

Hoping to be reassuring, Michael said, “That’s not uncommon. It’s a new thing for a lot of financial plan­ners. It’s not that they are unwilling. They just need some help to get started.”

“I think that’s probably the problem,” Todd re­plied. “He has always been very capable. What can I do to help?”

“I don’t want to butt in, but maybe I can help. If you will give me permission, I’ll call your guy and offer to help him get up to speed. There’s no need for you to change planners if he’s willing to make a little ef­fort. In fact, it will make him a better planner for all his Christian investors.”

This sounded like a good plan to Todd. He made arrangements to have Wallace call Michael and hope­fully they could all three get together to get things started. Todd felt much better about his potential for being a good steward. This whole thing was turning into a lot more work than Todd expected at the begin­ning, but it would be well worth it to hear the words, “Well done, good and faithful servant.”

 

This story is an excerpt from the book “Profit or Principles”, by Dwight L. Short.  Used by permission 

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