Summary of 2020 CIF Fund Performance Study

Highlights of the 2020 CIF Study on Faith Based Funds Performance

The purpose of this study is to review the performance of mutual funds managed in a proactive Christian Faith based investment process, compared to the industry benchmarks.  This study follows a similar analysis completed in 2015 by the Christian Investment Forum, but has extended the time period reviewed from 5 years between 2009-2014 to a 15-year period from 2005 through 2019.  This captures both the bear market during the Great Recession of 2007-2009, as well as the ensuing slow but historically long expansion market.

The study looked at return data for 44 Christian Faith based Funds in both equity and bond categories over a 15-year period ending December 31, 2020, and found that the performance of an average of those funds compared favorably against the benchmarks for each category, particularly in the equity funds categories.    The results were consistent over different time periods of 1 year, 3 years, 5 years, 10 years and 15 years.  The full 15-year period includes both bull markets and bear markets, including the 2007 – 2009 Great Recession.

 

 

The CIF Equity Fund Composite average, with an annualized return of 7.1%, outperformed the similar Benchmark weighted average return, which had an annualized return of 6.3% over the 15-year period.  There were 35 funds included in the Composite across 16 categories.

 

 

The CIF Bond Fund Composite average, with a 4.2% annualized return, outperformed the weighted average Benchmark return, which had an annualized return of 3.8% over the 15-year period.  The CIF Bond Fund Composite, which included 9 funds in 5 categories, performed relatively equal in the 2007-2009 Recession and has slightly out-performed in the nearly 10-year bull market that ended shortly after the December 2019 end of the analysis period.

 

Across six categories of equity and bond funds, each of which included at least 3 funds from the CIF Funds pool, the average of those funds outperformed the category benchmark average in four of the six, and in two categories the funds averages slightly underperformed the benchmark.  More analysis of the 1 year, 3 year, 5 year and 10 year time periods and risk metrics is included in the study detail.

These results support the business case that including faith based value criteria in the investment selection process can provide reasonable and competitive returns, allowing Christian investors the opportunity to invest according to their values while also acting in a financially sound manner.  This dispels some of the long standing perceptions that incorporating faith based criteria in addition to traditional investment criteria is correlated to underperformance.

 

Author’s Note

This study collected and analyzed financial data for a 15-year period ended December 31, 2019.  Given the volatility of the financial markets since February 2020 following the COVID-19 pandemic, the authors elected to review the year to date financial performance data for the CIF Funds and the related category benchmarks through May 31st, 2020 for any material or significant changes to the conclusions of this report.  The 15-year annualized return for the CIF Equity Composite Average dropped to 6.5% and the Benchmark weighted average return dropped to 5.7%, but the difference between the two remained the same at 13%.  Regarding the Bond category, the CIF Composite remained the same at 4.2% while the Benchmark weighted average increased to 3.8%, but again the difference remained the same at 9% outperformance for the CIF Funds Composite.

Based on this updated analysis, we do not believe the results and conclusions from the full report require any disclaimer or modification.

 

Link to Review of Academic Studies

 

Click HERE to get a pdf copy of the Highlights.

 

2019 Survey of Financial Advisors Summary

This 2019 Survey of Financial Advisors is the 3rd edition to study the current state of awareness, knowledge and use of Faith Driven Investing.  The first study was completed in 2013 and followed by the 2nd edition in 2016.

The 2019 survey, similarly to the 2013 and 2016 versions, focused on three areas beyond general demographic information.  The first objective was to understand advisor Awareness of Faith Driven Investing – what were the critical components, and how they perceived it as credible.  The second objective was to assess advisor Knowledge levels about Faith Driven Investing – did they feel reasonably informed and comfortable with the practice so that they could effectively communicate it to clients.  The third objective was to understand actual Usage of Faith Driven Investing by advisors and their clients, including possible barriers to increased use.

There are various terms used to describe investing that is purposefully aligned with Christian faith.  Some of the more commonly used are Biblically responsible investing (BRI), Values based investing, Faith-based investing, and Morally responsible investing.  In this report, the term Faith Driven Investing is used most often, but other terms may be used interchangeably.

From that survey data, following are the key takeaways:

Key Takeaway #1

Within the respondent pool, which is more closely aligned and sympathetic to faith and investing concepts, the AWARENESS of Faith Driven Investing and what makes up FDI remains at nearly universal familiarity, but there remains a sizable gap between that awareness and a more detailed functional awareness of the breadth of currently available product and service offerings.

 

Seventy-eight percent (78%) of respondents are members of Kingdom Advisors, and are more likely to be supporters of faith and investing concepts.  Fifty-four percent (54%) of respondents were very familiar with Faith Driven Investing (FDI), and ninety-six percent (96%) felt they were at least somewhat familiar with the investing concepts.  The advisors identified the main components of a Faith Driven Investing approach, but a large majority of them (87%) were not able to accurately recognize the number of Faith Driven Investing fund and product offerings available.

 

 Key Takeaway #2

The level of KNOWLEDGE in Faith Driven Investing, and belief in the credibility of FDI, is growing but has yet to reach a tipping point where more client conversations are regularly occurring.

 

 

Just over half of the respondents (51%) felt well educated on Faith Driven Investing.  Only three percent (3%) said they believe Faith Driven Investing is not a credible and appropriate way to manage client wealth, and ninety percent (90%) are interested in recommending investments that align with their clients’ faith and values.

 

Yet when queried, seventy-five percent (75%) said that less than 10% of their clients had asked about Faith Driven Investing.  Twenty-four percent (24%) had no client communication on Faith Driven Investing.

Key Takeaway #3

The Use of Faith Driven Investing is steadily increasing, with interest in recommending FDI to clients remaining well ahead of the usage patterns.  This suggests that Faith Driven Investing could grow significantly with the continued development of resources and tools to overcome barriers.

 

Sixty-four percent (64%) of respondents indicated they currently use Faith Driven Investing with their clients, but for most of them the allocations to FDI remain small.  Of those not using Faith Driven Investing currently, thirty-six percent (36%) were very interested to begin using FDI and another thirty-four percent (34%) were interested.

 

 

 

 

The top five reasons given for not using Faith Driven Investing were 1) No client demand, 2) Lack of information & knowledge, 3) Limited investment options, 4) Unproven performance, and 5) Need for better screening tools.

 

CONCLUSION

The results of this 2019 Survey of Financial Advisors on Faith Driven Investing Awareness and Use show continued, albeit slowing, improvements in all three areas – awareness, knowledge, and use.  This slowing growth is relative to the last survey completed in 2016, which had shown more substantial improvements compared to 2013.  In part this is due to a higher baseline, so sizable gains are more difficult to achieve.

To a large degree, the issues limiting the use of Faith Driven Investing remain the same since the initial study in 2013, though with some lessening in importance over the last 6 years with increased awareness and knowledge.  There continue to be gaps in perception compared to reality on product availability and performance.  Yet some further structural changes are needed – additional investment products that can more closely align with the different faith values of investors, increased acceptance of funds onto proprietary platforms, and additional research to support the already existing data on ESG, FDI, performance, and expenses.

The greatest opportunities to build momentum towards increasing the use of Faith Driven Investing are in helping encourage further education, and more importantly encourage conversations between advisors and investors.  Both advisors and investors show high levels of interest in Faith Driven Investing, but neither advisors or investors are initiating a conversation or asking questions about FDI.  More education on the topic of Faith Driven Investing can help to increase confidence for advisors to have the conversation.  Similarly, more investor oriented information can help Christians recognize their role in asking questions of their financial advisor.

For those interested in supporting and growing Faith Driven Investing, there are strong reasons to be optimistic about the future growth in the use of FDI overall, and as a share of total assets under management.  Data from this survey confirms previous research that a majority of investors and advisors alike have an interest in better aligning investments with the client’s personal faith and priorities.  Macro trends in the market are showing investor interest in a more meaningful and integrated approach to investing in alignment with values.  There are more organizations engaging in the conversation about FDI, and collaboration between them on messaging is improving.  All of this helps to encourage others to understand they are not alone in desiring a more integrated approach to investing with their faith.

 

 

 

A pdf version of this summary is available here.

Summary Report – CIF 2019 Survey of Financial Advisors [pdf]

 

 

If you’d like the full report of the survey findings, please click the button below and provide your name and email address and we will provide you a complimentary copy of the report.

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A Manifesto for Financial Advisors

A Manifesto for Financial Advisors

This article was originally published here.

by Jeff Haanen

Financial advisors play a critical role in the future of America.

They are stewards of a sacred trust, helping clients to save money for when they can no longer work, live a life of generosity, invest in businesses that align with God’s purposes for the world, spend wisely, and re-discover their calling to work and serve their neighbors over a lifetime.

If you’re a financial advisor, or you know one, what might it look like integrate Christian truth into this entire field, a $27 trillion-dollar industry that is shaping the destinies of millions?[i] (Click here to access a free downloadable pdf of this “Manifesto for Financial Advisors.”)

 

Here’s a place to begin.

  1. Christian financial advisors help clients save money for when they can no longer work.

Saving is wise (Proverbs 21:20). Financial advisors have the privilege of encouraging people to prepare for the day when they cannot work due to old age or health. They also have the honor of helping clients still have enough to share with others (Proverbs 13:22; 1 Timothy 6:17-19).

But Christian financial advisors resolutely resist the narrative about saving for retirement built on utopian dreams of travel, never-ending vacation, and a care-free lifestyle. They recognize that sin and the Fall have affected all people, both wealthy and poor, and that there is no such dream of heaven on earth until Christ comes again. They also boldly call into question fear-based motives for saving in retirement, pointing people to trust God alone for their daily bread.

Also, since retirement (the cessation of work for a lifetime) is essentially a foreign concept to the Bible, Christian financial advisors work diligently to help people save for the day when they can no longer work due to health concerns, not for the day when they don’t want to work.

To work is to be human.

Financials advisors help their clients save money for retirement in order to provide for themselves in old age or illness, their family, and their community.

 

  1. Christian financial advisors encourage clients to live a life of generosity.

God’s call to generous giving could not be clearer (Matthew 6:19-21; 10:42; Luke 21:1-4; 2 Corinthians 8:12-15; 1 John 3:16-18; Proverbs 11:24-25). Generous living most closely reflects God’s grace toward his people (2 Corinthians 8:9).

Christian financial advisors counsel clients toward sacrificial giving toward the mission of the church, the well-being of the poor, and the critical social, economic, and cultural needs of our day. They explore creative ways to facilitate their clients giving their cash, assets, time, skills, relationships, and influence. They lead by example.

Even though Christian financial advisors often don’t have a financial incentive to encourage generosity amongst their clients, they do so anyway because God first gave generously to them (John 3:16). 

 

  1. Christian financial advisors counsel their clients to invest in businesses that align with God’s purposes for the world.

Christian financial advisors believe that God owns everything (Psalm 24:1), including both their client’s money and also the money that is invested in companies through stocks, bonds, and mutual funds.

They are leaders in the space of socially responsible investing (some Christians also call this values-based investing, or biblically responsible investing). They believe God’s purpose for business is to provide for the needs of world by serving customers and creating meaningful work, while giving glory to God.[ii] Profit, therefore, is a means to an end, not the end of business. They believe investments are intended to help businesses grow and bless their communities. Christian financial advisors also believe business has been tainted by the Fall, and today corporations, like individuals, are bent toward greed and injustice (Micah 6:8-10). There are no “neutral” investments.

Inasmuch as they are able, Christian financial advisors seek out investments for their clients that align with their client’s values and God’s good purposes for business. They take leadership in providing ample returns for their clients and multiplied societal blessing through their client’s investments.[iii]

 

  1. Christian financial advisors counsel their clients to spend wisely.

God has given us money to be enjoyed and spent wisely. But Christian financial advisors also recognize that “godliness with contentment is great gain,” and Christian history is filled with vows of poverty and commitment to simple living for the sake of more deeply enjoying the riches of Christ (1 Timothy 6:6, 17-19).  Frugality is not a curse but a means to experiencing the abundance of God’s love, care, and heavenly riches.

Christian financial advisors are uniquely able to speak to our cultural moment and the current “retirement crisis” because they believe God himself, not the pleasures of this world, is our greatest joy. They believe in a deeper wealth than what money can offer.[iv]

Christian financial advisors counsel their clients to avoid debt, live within their means, defer gratification, and discover non-consumeristic ways to enjoy life and God’s good world.

 

  1. Christian financial advisors counsel their clients to consider the different seasons of work over a lifetime.

Christian financial advisors see God’s pattern of six days of work and one day of rest as a blessing that lasts for a lifetime.

Rather than preparing clients to completely cease from work at retirement, they encourage sabbaticals and seasons of rest to renew a sense of calling for the next phase of life.

Therefore, they are instigators of a deeply counter-cultural movement. They begin to help clients save money for both sabbaticals and for when their clients can no longer work. They ask pointed questions to help their clients see a deeper purpose to life than entertainment or pleasure.  Christian financial advisors, then, become sages, mentors, theologians, and philosophers who help their clients prepare for the next season of work, whether they are 60, 70, or 80 years old.[v]

Christian financial advisors are the innovators who call for a new movement of work, sabbatical, and re-engagement based on God’s design for work over a lifetime (Leviticus 25).[vi] They openly challenge the Let’s vacationparadigm of retirement, and honor the men and women who work later in life as the dignified elders of our churches, communities, and society.

They are the first to point out the valuable, brilliant, and creative work of men and women stewarding their skills, knowledge, and abilities into the sunset of their lives.

 

For a free downloadable version of this manifesto, visit https://www.uncommonretirement.com/financial-advisors.

 

Endnotes

[i] Nick Thornton, “Here’s What the $27 Trillion US Retirement Industry Looks Like,” Think Advisor, 2 January 2018, Accessed on August 10, 2018: https://www.thinkadvisor.com/2018/01/02/heres-what-the-27-trillion-us-retirement-industry/?slreturn=20180714204623.

[ii] Jeff Haanen, “Theology for Business (Video),” Denver Institute for Faith & Work, Accessed on August 1, 2018: https://denverinstitute.org/video-the-purpose-of-business-today/.

[iii] Organizations like the Christian Investment Forum and faith-friendly mutual funds like Eventide Funds actively explore how to pursue competitive returns for their shareholders while upholding Christian values. For examples of philosophies of Christian faith and investing, watch the video “Investing 360 – The Story of Eventide Funds”: https://vimeo.com/223488058 or read “Integrating Faith Into the Way We Invest,” by Tim Macready, CIO of Christian Super, an Australian Pension Fund: https://denverinstitute.org/integrating-faith-way-invest/.

[iv] For an excellent treatment on faith, money, and retirement, see: Chad S. Hamilton, Deep Wealth (Denver: PFI Publishing, 2015).

[v] I recognize this is almost unheard of today. But my thesis in this book is that this rhythm of work and rest is more biblical than the contemporary idea of retirement and it more closely aligns with God’s intent for us to work, in different capacities, over a lifetime.

[vi] Rob West, the CEO of Kingdom Advisors, a Christian ministry to financial professionals, says, “One of the roles of the advisor is to not only help the client to answer the question, ‘How much is enough financially?’ – in terms of our financial finish line so we can maximize giving – but also, ‘What are you going to do in the retirement season?’ Even if we stop our vocation, what are we going to do to be of service to the Lord full-time for God’s glory?” Both Rob West and Ron Blue, the founder of Ron Blue Co. believe both wise financial decisions and a lifetime of work, which changes in different seasons, are biblical.

Barrons – MicroVest Sees Microfinance Shifting to Small Business

MicroVest, a 15 year old firm focused on the Microfinance sector, and a Partner of the Christian Investment Summit, was recently highlighted in a Barron’s article.  Here’s an excerpt from the article:

By Abby Schultz July 26, 2018 3:34 p.m. ET

Microfinance—the business of investing in financial institutions that make loans to low-income entrepreneurs in developing countries—is a form of investing for social good that long predates the decade-old impact investing market.

Today, microfinance is a key part of many impact portfolios, representing 9% of assets held by impact investors surveyed by the Global Impact Investing Network, or GIIN.

But for MicroVest, a 15-year veteran fund manager in the sector, the practice of investing in microfinance institutions is shifting from “classic” microfinance—providing loans to individuals selling vegetables at a local market, for example—to investing in small businesses, a sector MicroVest says is often under-served. “What happens when the woman borrower who started with a $200 loan has built her business and has 10 employees and now needs $5,000 in capital to buy equipment and machinery?” asks Ron Cordes, the former co-founder and executive co-chairman of AssetMark, who has invested in MicroVest through his family foundation since 2007.

“One of the issues with traditional microfinance is the organization she’s borrowed from to that point no longer has capacity to serve her,” Cordes says.

One of MicroVest’s objectives now is to serve this “missing middle,” by investing in low-income financial institutions with the capacity to lend to small businesses, to, in effect, strengthen the hand of these institutions to grow and serve more clients, which in turn helps to strengthen local developing economies.

“Small businesses pay taxes, so you can have schools and roads. They hire people outside of the family unit, they formalize and start to follow regulations, and they can link into the export economy,” says Gil Crawford, CEO, who co-founded the firm in 2003.

 

You can find the full article at the MicroVest website here, or at the Barrons website here.

Biblically based Investing…with a Charitable Twist

Biblically based Investing…with a Charitable Twist

The need for Biblically responsible investing with donor advised funds.

By Bill High

 

There’s a growing movement towards biblically responsible investing. As people realize that their investments have been going towards businesses that support unbiblical practices such as abortion, pornography or human trafficking, they are saying “No more.” Instead, to ensure that their investment decisions line up with their faith and values, they are switching tracks and turning towards an alternative: biblically responsible investing.

At the same time, the donor advised fund world is also exploding. According to National Philanthropic Trust’s “2017 Donor Advised Fund Report,” donor advised funds house over $85 billion in assets. They have shown steady growth as a charitable vehicle, increasing from 2016 to 2017 by 10 percent. Giving USA reports donor advised funds as “the fastest growing vehicle in philanthropy,” listing their growth rate as “three times the rate of total charitable giving in 2016.”

Here’s how a donor advised fund works: a donor deposits money into a donor advised fund and instantly receives a tax write-off. The money can then sit in the fund for years to come. It grows in investments until the donor is ready to recommend that a grant be sent out from their DAF to a charity.

Essentially, donor advised funds are the next big thing in charity.

Donor advised funds provide a win-win solution for both charities and donors. The donor gets the tax benefit of an income tax deduction the same year the gift is given. But once the money is in the donor advised fund, it can grow in investments for as long as the donor chooses. In the end, more money goes out to charity, since the donor advised fund allowed the gift to grow over time.

Donor advised funds are an excellent solution for strategic generosity. However, between biblically responsible investing and donor advised funds, there lies a gap.

When it comes to personal finances, people of faith are turning towards biblically responsible investing. But what about when it comes to charity? Are they being equally careful with the money that has technically already been “gifted” but is still under their management through a donor advised fund?

I did a quick Google search and could not find a single donor advised fund sponsor who practiced biblically responsible investing. Not to say they don’t exist; I just couldn’t find any. Even among Christian foundations.

Here Christians were—being so careful to invest their personal finances using biblically responsible investing. But when they wanted to give to charity, no donor advised fund option allowed for the same amount of care. There was nowhere the money would be biblically invested.  Something had to change. So we started The Signatry.

As a Christian, God calls us to be charitable. He also calls us to be wise.

There seems to be a disconnect. When we make investments for our personal gain, we make sure they’re invested responsibly. But when our money is already dedicated towards charity (as in a donor advised fund), we don’t question the investments.

At The Signatry, we don’t think that makes any sense. First off, all of our resources belong to God. As Psalm 24:1 states, “The Earth is the Lord’s and everything in it; the world, and all who live in it.” Since everything belongs to God, we are simply God’s caretakers, responsible to account for everything he’s given us.

If the money in a donor advised fund is dedicated towards making a difference for the Kingdom, then even before it is granted out, that money should already be making a difference. Or at the very least, it should not be invested in causes that are blatantly against biblical values.

Second, most faith-based foundations have standards for which charities receive their grants. Each charity is vetted through strict compliance measures to ensure they qualify as a grant recipient. Now, does it make any sense to have strict standards for the receiving ministries, but not to have the same standards for investments?

As far as I can tell, The Signatry is the only  Christian foundation offering investments that also comply with Christian values. This shouldn’t be the case. We are hopeful that one day biblically responsibly invested donor advised funds will be the norm, not the exception.

Let’s start a movement of Christians who are biblically minded, not just in their personal finances but also in their charitable contributions. Let’s make sure every dollar is used ethically—from the first investment to the last check sent to a ministry.

 

 

 

About the Author:

Bill High is CEO of The Signatry: A Global Christian Foundation. He has coauthored Giving It All Away … And Getting It All Back Again: The Way of Living Generously with Hobby Lobby founder David Green. You can learn more about investing in eternity and living a joyfully generous life at billhigh.com.

Landscape Study on Christian Investing Highlights Opportunities and Needs

Recently a new study was published by Nexus Impact Advisors on Christian based investing.  The study author, Endel Liias, notes that it is there “hope that this information will be useful to people across the Christian investing spectrum—from investors and philanthropists to investees and entrepreneurs to the intermediaries, educators, and advisors that connect them.”

The report attempts to shape the full breadth of the market by offering some definitions for different segments to better classify the entire landscape of investing with Christian values.  The report is merely an introduction, as it was meant to be, and offers us the chance to follow-up with some well-designed research and studies to further expand our knowledge of each sector in more detail.  Why is that important or worth doing?  For several reasons.  First, it provides validation of the market opportunity that is currently underserved in hopes it can grow.  Second, it reinforces the professionalism and credibility of Christian investing against some common and long standing misperceptions or biases.  Third, it can identify potential gaps that providers can address or fill.  Fourth, it guides the ability to measure and analyze to determine if progress is being made.  Finally, it can offer the support of community to those involved or those considering to get involved.

Here is one highlight and some concluding thoughts from the report:

  • Overall, impact investing is estimated to total approximately $114 billion, with Kingdom Impact Investing estimated to be $2.0 – $3.0 billion. There is a much larger opportunity as the infrastructure matures, more options become available, and more investors gain an appreciation.

As the report concludes:

“The wide range of stakeholders and activities in Biblically-responsible and Christian impact investing is evidence of a robust and burgeoning marketplace, and this growth is likely to continue apace in the coming years.”

“Over the next three decades, approximately $30T in assets will be passed from baby boomers to millennials—the largest intergenerational wealth transfer in history. This will have major implications for the way money is invested, as younger generations increasingly look to spend and invest in accordance with their social, environmental, and moral convictions. “

“This presents particularly unique opportunities for development of the Christian investing marketplace… Meeting this demand will require the skills, creativity, and hard work of stakeholders across the Christian investing industry, as well as the participation of new entrants. “

 

The report is available at the website of Nexus Impact Advisors HERE .  The website contains much more information, research, and resources for impact investing generally and Kingdom Impact Investing more specifically.  A visit to the site is highly recommended.

About Nexus – Nexus Impact Advisors is a mission-driven research and advisory firm specializing in impact investing.  To learn more, visit www.nexusimpactadvisors.com .

 

 

Billy Graham Aiming High

Some years ago, a family member thoughtfully gave me a daily devotional book authored by Billy Graham called “Wisdom for Each Day”.  The entry for February 21st, the day of his passing, seems relevant to share.

TAKE AIM!

“Set your mind on things above, not on earthly things.”  Colossians 3:2

During the Second World War, the words of General Douglas MacArthur echoed in the hearts of the people of the Philippines, “I shall return” – and he kept that promise.  Jesus Christ has also promised, “I shall return” – and He, too, will keep that promise.

A continual looking forward to the eternal world Jesus will usher in is not a form of escapism or wishful thinking.  We Christians look forward with anticipation to Christ’s return and spending eternity with Him.

The promise of that new world, however, does not mean that we are to leave the present world as it is.  If you read history, you will find that the Christian who did the most for the present world were those who thought the most of the next.  Only Christians who cease thinking of the next world become ineffective in this one.

“Aim at heaven,” said C.S. Lewis, “and you will get earth thrown in.  Aim at earth, and you will get neither.”  At what are you aiming?

 

I think everyone would agree that The Reverend Billy Graham’s aim was right and true.

Profit or Principles: Investing without Compromise book excerpt

“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.

 

◘◘◘◘◘

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 

Denver Institute for Faith & Work video of Eventide Funds

Jeff Haanen, Executive Director for the Denver Institute for Faith & Work, recently met with the team from Eventide Funds to learn more about the organization.  From that meeting a short video was filmed, and published to the DIFW website.  Jeff has graciously shared that video with us, and we wanted to share it with you.

Here is the video

Investing 360 – The Story of Eventide Funds from Denver Institute on Vimeo.

 

DIFW also created excerpts on specific topics, in case you can’t watch the full 5:23 video, and they’ve shared links to those with us as well. Watch and share with a friend.

 

Learn more about the Denver Institute for Faith & Work by visiting their website.

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