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Religious Alliance Seeks Ways to use Wealth Wisely

Mott Mosaic, January 1 2004:

This board is representative of ARC's membership

BY MAGGIE I. JARUZEL, Mott Mosaic

Martin Palmer, secretary general at the Alliance of Religions and Conservation (ARC), says the world’s largest faith communities have lifted the veil on the last religious taboo: the discussion of God and mammon, or wealth. Specifically, people of faith are now asking, individually and collectively, “How can we best invest our money to make a difference on Planet Earth?”

When working in cooperation with other religious groups and with international environmental organizations such as the World Wildlife Fund (WWF), the world’s religious community has the potential to be a huge force for positive social and ecological change by developing socially responsible investment polices, said Palmer. While he is not a Pollyanna, he is a firm believer that within a few decades the combined economic strength of the world’s faith communities could influence the reallocation of hundreds of billions, if not trillions, of dollars.

The prominent role of faiths

Palmer supports his premise by pointing to vast amounts of resources — stocks, land, hospitals, schools, publications, tourist sites — that are owned, operated and/or influenced by religious organizations worldwide.

“Most people in the West see religion as . . . essentially an ethical, moral force. Well, of course, it is,” said Palmer from his office in Manchester, England.

In 2003, Mott gave a grant to ARC to help 3iG develop a database and a model network to educate faiths about socially and ecologically responsible investment opportunities. This grant will help 3iG evolve into a separate entity; a transition is expected to be completed by the end of 2004
“But what we’ve uncovered over the years — in terms of forest or farm ownership, urban development and ownership of health and educational institutions — is that the major religions are extremely successful multinationals, the oldest multinational businesses in the world. We’ve said, ‘This in no way diminishes your spiritual role, but you are actually businesses.’”

Increasingly, differing faiths are acknowledging this prominent role. They are linking arms and pooling capital, flexing their combined fiscal muscles. Their goal is wise stewardship of Earth’s resources, as both investors and consumers. Under ARC’s auspices, representatives from 11 faiths worldwide — Baha’is, Buddhists, Christians, Hindus, Jains, Jews, Muslims, Shino, Sikhs, Taoists and Zoroastrians — have come together to form a new group called the International Interfaith Investment Group (3iG).

Mott as sponsors

In 2002, the Mott Foundation provided a one-year, $100,000 grant to the San Francisco-based State of the World Forum to support the launch of 3iG. In 2003, Mott made a one-year, $100,000 grant to ARC to help 3iG develop a database and a model network to educate faiths about socially and ecologically responsible investment opportunities. This grant will help 3iG evolve into a separate entity; a transition is expected to be completed by the end of 2004, Palmer said.

International Interfaith Investment

To date, 3iG’s religious leaders/members have met several times, most recently in October in Istanbul, Turkey, where they fleshed out basic organizational guidelines, membership rules, and administrative details. Members also discussed broad investment strategies with their secular Advisory Group, which is composed of professionals from the fields of banking, philanthropy and environment, including Michael Even, chief investment officer for Citigroup private bank/Citigroup asset management, United States.

“From what I’ve seen, I’m excited both personally and professionally. As an investor, I see them thinking along very strategic and long-term lines. They’re thinking about ways to use their power, their influence and their wealth to drive a socially responsible investment agenda forward.”

Historically, the posture of the faithful has been reactive; they were known for what they didn’t invest in, said Peter Charrington, also a member of 3iG’s Advisory Group and director for private banking at Citigroup, United Kingdom.1 For example, Methodists didn’t invest in gambling or alcohol, Quakers in anything military, and Muslims in anything to do with pork production.

But today the faithful are taking a more pro-active stance, he said. They are publicly stating the areas they will invest in: micro-enterprise, affordable and sustainable housing projects, sanitation projects, forest management programs, and many others.

Charrington suggested that one investment cluster might pool money, especially from faith groups that prohibit eating meat, to invest in companies engaged in organic vegetable production farming. Other religious clusters could combine funds for use as venture capital for companies developing alternatives energy sources such as wind power, solar energy and hydropower.

While it’s unlikely that one single faith group could infuse enough capital to make a substantial impact, when banded together these faith clusters could invest multiple millions of dollars, said Charrington, who described 3iG’s investment goals as “innovative, leading-edge, and pioneering.”

Support from Mongolia

Another advocate of 3iG’s work is Mongolia Prime Minister Nambaryn Enkhbayer. The devout Buddhist was named ARC’s first international president in June 2003.

“The pioneering work of ARC worldwide has created many projects which I personally find of great interest,” he said.

“But perhaps one of the most significant has been its program on the stocks and shares of the major faiths. Taking the religions seriously as businesses, as well as centers of spiritual insight, is a revolutionary new approach. … [ARC] also takes seriously the real role of faiths in supporting the welfare, education, development and environmental protection of our countries.”

Enkhbayer is one of many high-profile international people associated with ARC. Others include World Bank President James Wolfensohn, who has personally worked with ARC on biodiversity and land management issues, and Prince Philip, Duke of Edinburgh. The prince, ARC’s founder and also president emeritus of WWF, hosted a November 2002 ARC meeting at his home in Buckingham Palace while 3iG had its meeting in one of the Royal Palaces.

Garnering support from influential global leaders adds credibility to 3iG, but the organization’s advocates say its greatest strength thus far has been its ability to remain “more practical than pious.”

US Faith-based investment

That aspect attracted 3iG member Sister Patricia Wolf, executive director of the Interfaith Center on Corporate Responsibility (ICCR), located in New York City. ICCR is the United States’ largest coalition of faith-based institutional investors with 275 members and a combined investment portfolio worth an estimated $100 billion. The coalition merges social values with investment decisions under the motto: “Inspired by faith; committed to action.”

While in the social investment field for 25 years, Wolf has watched as issues that previously seemed important only to her and her constituents have gradually become important to the average investor. In addition, she said 3iG recognizes that interest in socially responsible investing is not limited to Western countries, but is truly a global issue.

For Wolf, 3iG is a group whose time has come.

"A very very large amount of money indeed"

The Right Reverend Dr. Peter Selby, Bishop of Worcester in the Church of England, agrees. He says 3iG’s work is simple: to witness to the world about the balance between what a faith professes to believe and what it actually practices. As a Church Commissioner for England, Selby is closely involved with the church’s finances. Central funds, however, make up only a small part of the financial assets of the church’s 44 dioceses, which are, in turn, broken down into thousands of parishes with more than a million members.

He points to the financial assets of not only the church itself, but also the people sitting in the pews. Those combined figures soar when indirect resources, such as parishioners’ personal pension funds, are included in the equation.

“When it’s all added together, we are talking about a very, very, very large amount of money indeed. And that’s only within the Church of England. When we pool our money with other faiths, we’ve got much more power than we ever thought possible.”

To get a good grasp of the potential amount of money available from faith groups, Citigroup employees, in conjunction with staff from the United Methodist Church (UMC) in the United States, conducted an audit to determine just one Christian denomination’s assets.

Ethical Pensions

For starters, the UMC’s pension fund for its clergy contains $12 billion. Further financial analysis showed the denomination’s combined assets (from various departments — mission, education, laity, building programs, etc.) were roughly $70 billion. After calculating membership figures, researchers were amazed to find that there is an estimated $250 billion to $500 billion in available assets in the hands of this denomination and its 11 million lay members, should they choose to follow the faith’s social investment plan.

That exercise enabled ARC members to paint a picture of the global good they could do by combining their financial strength. They discovered that ARC’s 11 participating faiths:

own 7 percent of the habitable surface of the planet; own outright or provide a religious foundation for 54 percent of the schools; and produce more weekly newspapers and journals than those published in all of Western Europe.

Collective Power

That collective power is only beginning to be tapped, said Citigroup’s Charrington, who speculated that ARC is at the tip of a huge iceberg that will surface soon. Some signs are already visible. Increasingly, before building new temples, mosques, shrines, churches or synagogues, people of faith are requiring that the lumber used for these projects be marked with the seal of approval from the Forest Stewardship Council, an Earth-friendly forest management group.

When it comes to resources, ARC is in a position to be envied, said Palmer, citing the organization’s readily available power source.

“Most nonprofits have to focus on capacity building. ARC doesn’t. We have the capacity — it’s called the village church or the mosque in town or the temple in the city. Our role is to enable the faiths to mobilize the capacity they already have. We’re saying to the faiths, ‘If you develop a socially responsible investment program, then you have a duty to pass on that insight to the ordinary person in the pew or in the mosque or in the temple.’”

1 Citigroup, along with the British-based Pilkington Foundation and the World Wildlife Fund, have funded 3iG’s growth and development. The State of the World Forum has provided organizational support.



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