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Socially Responsible Investing:
“Touching the Lives of People We can’t Count”

Socially Responsible Investing

Somewhere in the United States there is a Coca-Cola employee with HIV who has the life-saving drugs she needs because of action taken by the Dominican Sisters of Springfield. Throughout Asia, factory managers are receiving the training they need to implement safe labor practices, protecting the lives and dignity of thousands of workers, because the Dominicans understand the importance of advocating for change in systems and institutions that oppress.

These are just two examples of the benefits of a growing global movement toward socially responsible investing. Religious communities, including the Springfield Dominicans and the ten other members of the Dominican Alliance, have joined others in this hopeful and effective investing trend that uses tools like portfolio screening, shareholder advocacy, divestment, and alternative investing to support grassroots efforts toward global social change.

Changing corporate policy

The Dominican Alliance Coalition for Responsible Investment (DACRA), to which the Springfield Dominicans belong, works through another group, the Interfaith Center on Corporate Responsibility (ICCR), in order to effect change in corporate policy. ICCR was organized by the Episcopal church in 1971. It now has a membership of 275 Catholic, Protestant, and Jewish organizations. In 1984, just $40 billion was invested for purposes of social responsibility nationwide, according to Springfield Dominican Sister Linda Hayes, DACRI chairperson. “Today, one out of every eight dollars invested in stocks was prompted by a socially conscious decision,” she says. That comes to $2.34 trillion, or 12% of all investment dollars. With that level of impact, “Socially responsible investing is more than a matter of financial investment,” Sister Linda insists, “it is a work of structural justice.”

DACRI includes ten of the eleven Dominican Alliance congregations. In addition to the Springfield Dominicans, the other participating congregations are based in Akron and Columbus, Ohio; Great Bend, Kan.; Houston; Kenosha, Wis.; Springfield, Ky.; and Oxford, Mich. Two New Orleans-based congregations, the St. Mary’s Dominicans and the Eucharistic Missionaries of St. Dominic, are also DACRI members. The Dominican Sisters of Sinsinawa, Wis., are the newest members of the Dominican Alliance. They have not joined DACRI, but they have a 30-year history of socially responsible investing.

“For us, socially responsible investment is a necessary component to fulfill our mission to bring about a holy and just society,” says Sister Reg McKillip, investment coordinator for the Sinsinawa Dominicans. “We are called to use our resources to benefit all of our global society. We help people all over our world to better their lives and uphold their dignity.”

No business as usual

The Dominican Alliance congregations are one small but representative corps of the hundreds of religious organizations that have discovered the value of using their investment dollars to bring about systemic change. ICCR executive director Sister Patricia Wolf, RSM, is quick to suggest that every congregation and every individual see themselves as part of a global movement. “It makes no difference if you are a large or small shareholder,” she says. “All of us together create ICCR.” Many of the ICCR members are coalitions of Catholic sisters’ congregations. The Catholic groups don’t have the biggest portfolios, she says, but they make a significant contribution in terms of their passionate commitment to justice, their expertise, and the quality of dialogue they bring to the table.

Sister Linda points out that ethical investing has an ancient history going back to biblical times. It’s only in the past twenty years that modern investors have begun to understand is merits, however. “Wall Street believed that making social judgments would have no effect on corporations and would limit return to investors,” Sister Linda said. By the mid-1980s and 1990s accumulated research began to prove Wall Street wrong on both counts.

Sister Linda notes with some satisfaction that ICCR recently received a 98% vote on the Coca-Cola HIV/AIDS resolution. “The board of directors recommended the vote because it made good business sense for them to do so,” she adds. And, while there is a laundry list of other issues ICCR is sill raising with Coke—human rights, environmental issues, and water issues, among them—every victory is a step toward protecting the values that religious investors espouse.

A triple bottom line

“Companies like Coca-Cola are very aware that it cannot just be ‘business as usual’ anymore,” Sister Linda says. They cannot do business without taking into consideration what she calls the “triple bottom line”—the financial, social, and environmental impact of their policies.

It is truly a sense of mission and faith that inspires the investing efforts of the Dominican Alliance congregations. “Because we vow poverty, we view all of our resources to be used in the service of life,” says Sister Gemma Doll, prioress of the Great Bend Dominicans. “Individually and corporately we work for justice and human rights. We refuse to capitalize nuclear weapons, firearms, and tobacco, and we use our voice to vote for workers’ rights, access to healthcare, and care of creation.”

For Sister Peggy Sause of the Columbus Dominicans, socially responsible investing is a way of “preaching Jesus’ Good News in the world of finance,” she says. “It allows us to use what financial power we have to urge various corporations to act more justly here in the United States and in developing countries around the world.”

And for Sister Suzanne Brauer of the Eucharistic Missionaries, her participation in DACRI is about “speaking the truth of social justice in a collective voice to some of the most powerful corporations in the country.”

While socially responsible investing may seem remote from the ministry of Catholic sisters working in parishes, clinics, and schools, it is linked more closely to this day-to-day experience than one might think. ICCR’s Sister Pat Wolf sees it as an extension of a passionate commitment to the poor, the sick, and the uneducated around the world. Through careful stewardship of financial resources, the Dominican Alliance congregations are, she says “touching the lives of people we can’t count.”

Alternative investments: Being where our bodies can’t be

Alternative investing is a type of socially responsible investing that differs in scope and intention from shareholder advocacy. Shareholder activities are long-term strategies designed for structural change within large companies. Alternative investments allow investors to have an immediate support for their local communities.

For example, Rhoda lives in Uganda and is successfully running a small business through which she supports and educates her children. Her business got the boost it needed from two small loans from the Women’s Village Banking Group, one for $42, the other for $57. This micro loan organization is supported with funds from Dominican Alliance Community Investments, an alternative investment portfolio managed by the Calvert Foundation.

Sister Barbara Rapp, a Kentucky Dominican who helped to establish Dominican Alliance Community Investments four years ago, calls it “another way of being in ministry where our bodies can’t be.” The investment program makes loans to other not-for-profits that support domestic and international micro credit, housing, and community development projects. Each congregation’s investments are managed separately and pay 0-3% return, depending on the individual congregation’s needs. Calvert Foundation designed the portfolio to match the interest of the Alliance congregations, who because of their growing relationship with the Dominicans in Zambia, requested that a portion of the funds be devoted to groups working in Africa, like the one that supports Rhoda.

“Instead of putting the money under the mattress or in the bank, you can see communities transformed,” says Tim Freundlich of Calvert. “This is very personal and mission-oriented, and that speaks to faith-based investors.”

This story was prepared for use by Dominican Alliance congregations in their community newsletters. It was first published in JUST Words, Vol. 5, No. 1, Winter 2005.

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