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Church investment: unethical? Unbiblical?

Screen Shot 2014-06-30 at 12.05.13The historic investments of the Church of England are managed by the Church Commissioners, who are formally independent of Church leadership though report to General Synod. They hit the headlines in the 1980s when they lost a staggering £800 million, largely through unwise property speculation, and though there have been glitches since then, the financial performance of what is now one of the largest and most influential institutional investment portfolios has been impressive. (The poor return in the pension scheme is due to the number of retired clergy to support, rather than poor performance of the investment fund.)

But recently, the Commissioners have more hit the headlines because of a disconnect between investment decisions and church policy. The most recent was the fiasco about the housing for Peter Hancock, the new bishop of Bath and Wells, where the Church Commissioner’s decision was overturned, and last year involvement with Wonga embarrassed Justin Welby.

Following on from this, the latest report from the Ethical Investment Advisor Group, defends continue investment in Wonga in quite a bizarre way. There are some positives; in his introduction, the Chair of the group, James Featherby (pictured), announces that:

we are in the process of tightening our recommendations regarding investment restrictions, both in terms of the maximum percentage of restricted activities that may take place within permitted investments and our rules around pooled funds…

But the justification for what anyone would consider poor ethical investments is very odd:

Elsewhere, it is no more realistic to desire that they invest only in morally perfect companies than it is to desire that any of us should relate only to morally perfect individuals. In any event, such an objective would rather miss the point of the Gospel. It is not the healthy who need a doctor but the sick. When engaging with companies the investing bodies seek positive momentum not perfection. We usually only recommend divestment where we see no genuine desire for change. 

This statement makes some very strange assumptions. First is the idea that those calling for clearer ethical policy believe there are ‘morally perfect companies.’ There are not—but there are companies which many would consider unethical and should not be invested in. This includes armaments manufacturers, the tobacco industry, and (for many) the alcohol industry. Given the fact that pay-day lenders are part of a system which traps people in poverty, and that Wonga is currently under consideration for criminal investigation, the pay-day lending industry looks very much like one to avoid.

Secondly, the redeployment of Jesus’ saying (Mark 2.17, Matt 9.12, Luke 5.31) seems odd. Is this suggesting the Church should invest in the most evil and unethical companies, with a view to getting them to become less unethical? This turns on its head the purpose of ethical investment; it is about getting a good return without ethical compromise, rather than using investment as a primary tool for influence. Surely influence comes in other ways?

Thirdly, the comment about momentum is curious. Since much investment is done through intermediary, pooled funds (as with Wonga), who is it that the Church should be influencing—the end company, or the intermediary doing the pooling? And is there any evidence that Church investment decisions really influence the choice of companies that pooled funds buy into? Wonga certainly appear to be impervious to criticism.

What is clear is that compromise in this area seriously undermines the Church’s teaching ministry. Though he is chair of a group which advises the Commissioners on ethics, Featherby is styled in popular reports as a ‘church leader.’ And the message which this sends out, loud and clear, is that the Church is hypocritical, and its leaders cannot agree.

640px-Illustration_Lolium_temulentum0I am also slightly puzzled by the use of the parable of the weeds from Matt 13.24–30. This forms part of Matthew’s third block of teaching by Jesus, and is one of the kingdom parables unique to Matthew (along with the treasure in the field and the pearl of great price). Like Matthew’s parable of the talents and parable of the sheep and the goats, it is widely misread. Following Augustine, most people read this as depicting the mixed nature of the church, arguing against the pursuit of a ‘pure’ church. In fact, Jesus gives his interpretation of it later in the chapter, in Matt 13.36–43. This clarifies two key points:

  • The field in the parable is not ‘the church’, but the world. The question the parable addresses is not ‘Why is the church mixed?’ but ‘If the kingdom has come, why are the wicked still living?’
  • The focus of the parable, the mixed nature of the field, hardly features in the explanation at all. Instead, the focus is the eschatological judgement exacted by God. So the invitation in the whole piece is less on putting up with compromise and more on being patient because of the certainty of judgement that is to come.

Jesus certainly talks elsewhere in Matthew of the mixed nature of the church, but this parable seems unrelated to it. To conclude from this that good and evil are hard to tell apart, and that we must put up with ethical compromise, is a long way from the parable’s original context and meaning. It also makes nonsense of the parable itself; the wheat and weeds (darnel) in the story are genuinely hard to tell apart; but this is not the problem faced by decisions on ethical investment. And there are many other places in the NT where, though we live alongside ‘the world’, we are implored to be ethically distinct from it.

I hope that response to this report might be a greater pressure for the Church’s investment policy to be more ethical, and for that ethical framework to be more clearly theologically grounded. If it is, it could be a significant support to the mission of the Church, rather than the embarrassment it often appears to be at the moment.

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14 Responses to Church investment: unethical? Unbiblical?

  1. Antony Billington June 30, 2014 at 3:38 pm #

    Hi Ian – just to say that he is *James* Featherby, not Justin Featherby.

    • Ian Paul June 30, 2014 at 5:14 pm #

      Oops, thanks. Corrected. I can see what was going on there! Bit of dittography…

  2. Etienne July 1, 2014 at 9:14 am #

    So on the premise that you wouldn’t invest your money in the armaments and tobacco industries because armaments and tobacco are immoral, would you also pull your money out of, let’s say, biscuit manufacturers?

    I mean, surely the makers of chocolate Hobnobs have just as much, if not more, to answer for as any armaments firm or cigarette manufacturer. You could say that one chocolate Hobnob won’t kill you. But neither will one cigarette. Even your average bullet is relatively innocuous when you consider that an annual production of 5.5 billion rounds of small arms ammunition in the US alone kills “only” 30,000 individuals every year. More than ten times that number die from obesity related illnesses, which surely makes bullets significantly safer and more moral than sucrose-laden treats.

    Deaths from smoking are probably on a par with those attributed to obesity, but all this does is highlight the extremely subjective and selective nature of the criticisms you level at Church investment policy. Before telling them to disinvest in Phillip Morris, why don’t you check your own portfolio to make sure United Biscuits, Nabisco, Mars, Nestlé and even McDonalds don’t feature there prominently?

    As someone with a particular interest in the gay celibate community (either that, or Living Out! are paying you to handle their PR), one might think you’d condemn what surely must be the single largest cause of premature death among gay celibate men. Of course, I have no reliable statistics to back me up here, indeed they probably don’t even exist, however my own observation leads me to conclude that obesity must surely kill far, far more gay celibate individuals than smoking or gunshot wounds.

    So where are the resounding cries for the Church Commissioners to bin the biscuits and ban the burgers? Or is obesity not on your radar screen because talking about it would offend too many within your constituency and, horror of horrors, jeopardize your leadership position?

    • Ian Paul July 2, 2014 at 8:33 am #

      Etienne, wonderful! I never fail to be impressed at how you can take something completely unrelated and find a way to make it part of the gay debate! Amazing!

      • Etienne July 2, 2014 at 9:49 am #

        Well, oddly enough, in my life most things do relate back to the “gay debate”, as you put it. Probably because I’m gay and have to deal with people like you who’d rather I didn’t exist. At least not in my current form.

        I realize we’re little more than a peripheral problem for you. I also realize you’d like us to keep silent and never talk about our lives and our issues until you raise the subject (in order to tell us what we should do, of course). Wouldn’t it be lovely if the gays would just keep quiet about their unpleasant lives like they used to in our parents’ time?

        Those days are long gone, Mr Paul. Without falling into clichés, we’re here, we’re queer, and the issues you hand down divine judgment upon affect us too. So why should we refrain from giving our perspective? Just because you don’t want to hear it? Tant pis pour vous, cher monsieur …

        • Ian Paul July 2, 2014 at 12:25 pm #

          No, I really do think ethical investment has no bearing on sexuality in fact! You are welcome to give your perspective but I don’t think there is a need to make these artificial connections.

          And i am fascinated to hear that I never want to talk about these issues. People usually accuse me of the opposite! Where have I ever said I would rather you didn’t exist?

          On the main point you make: a biscuit can be non-harming part of my diet. Cigarettes are always harmful, though less harmful the less you smoke them. Shooting someone can never be part of a balanced lifestyle.

          • Etienne July 2, 2014 at 9:43 pm #

            Yes, cigarettes and guns are harmful. But are they more or less harmful than high fat, high sugar “foods” with little or no nutritive value that induce a craving for more fat and more sugar and therefore lead directly to obesity and the extremely high levels of morbidity associated with it?

            [remainder of message cut]

          • Ian Paul July 2, 2014 at 10:50 pm #

            Sorry Etienne…straying too far.

  3. Alison July 1, 2014 at 9:27 pm #

    3 comments on disinvestment and 27 on filing sermons? Interesting. I was particularly hoping for a discussion on disinvesting from fossil fuels…

    • Ian Paul July 2, 2014 at 8:35 am #

      Alison, this is interesting, and something of a mystery. I think it must be related to two things.

      First, my readership. I notice there are plenty of comments on Archbishop Cranmer’s blog post…but most of them are deriding the EIAG or the Commissioners, rather than engaging in discussion about the question.

      Secondly, though, is the substantive issue. I wonder if the comments by EIAG are so woeful that they really close off any serious discussion about what constitutes an ethical investment.

      What do you think?

  4. Alison July 2, 2014 at 10:40 am #

    A friend who works for the Church Commissioners at a senior level wrote (on my Green page for the church magazine) “The Church Commissioners could not support a call for disinvestment. We think we can achieve far more by engaging with businesses as a shareholder than by just withdrawing. ” While I disagree, I am aware major shareholders do get to spend time with senior executives from FTSE 100 companies. So this provides some justification for not pulling out. However, a company is not going to change its core business. Also I can see it would be impossible for the CoE to invest solely in products that meet everyone’s ethical criteria, (She writes while eating a chocolate Hobnob.) Perhaps as Christians we struggle with ranking ethical decisions because we know all have sinned and fallen short ie we mustn’t rank individual sinners? Am absolutely aware that my own shares do not all pass my own criteria let alone other people’s.

    I am also reminded of my philosophy tutor’s comment when preparing for the Moral and Political philosophy paper was that “moral philosophy isn’t very interesting”! Why is it churches find it so much easier to discuss sexual mores than money although I understand Jesus’ remarks were focused the other way round? Is it to do with motes and beams?

    Many comments on Cranmer’s blog are off topic or personal attacks.

    • Ian Paul July 2, 2014 at 10:52 pm #

      Yes, they are.

      I’m afraid I find the argument you quote entirely unconvincing. I cannot see any evidence of change produced by the Church’s investment…and it is striking that no evidence is ever offered.

      And in the meantime, whilst waiting for this change, the Church is a partner in unethical and even illegal activities.

  5. paintingman July 9, 2014 at 12:19 am #

    Fortunately for ethical investors the long term prospects for renewable energy sources is very good. Fossil fuels are I believe ultimately more expensive as well as more anti-social and therefore doomed. Downside to this is that loads of pension funds are invested in Shell Royal Dutch etc.

    United biscuits I’d not heard any scare stories about until today but Nestle etc have a lot to answer for. Large numbers of consumers writing to these firms is possibly more effective than words in the boardroom unless you really ARE willing to remove your investment (ideally at a critical time!!!!). I observe that other campaigners get themselves to AGM’s to present their case with only a minimal number of shares to gain eligibility.

    • Ian Paul July 9, 2014 at 5:59 pm #

      Not sure I’ve ever heard of a Church Commissioner standing up in a shareholders’ meeting holding the management to ethical account…have you?

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