How Catholics Can Use the Power of Finance As a ‘Tool, Test, and Testament’ to Jesus Christ
Professor Eddy Moss of The Catholic University of America’s Busch School of Business shares how Catholics can use the power of finance to build up the Kingdom of God.
In the Gospel of Luke, Jesus Christ makes clear to his followers that how they use their wealth, or fail to use their wealth, has eternal consequences. A rich man, who carried on his life while ignoring the beggar Lazarus lying outside his gate, ends up in Hell eternally separated from God – while Lazarus who suffered in poverty is taken into heaven to be comforted by Abraham. The Gospel passage reinforces Jesus Christ’s teaching here and other passages that Christ’s disciples must be totally committed to him – and that not even the decisions they make with their wealth are off-limits when it comes to making a daily decision to follow him.
For more than a hundred years, the Popes of the Catholic Church have expounded on Christ’s teaching in encyclicals. And The Catholic University of America’s Busch School of Business has been working diligently to help Catholics live out their discipleship of Jesus Christ in how they invest and spend in today’s U.S. market economy. In this Register interview, Eddy Moss, an adjunct professor of wealth management at CUA’s Busch School and Morgan Stanley financial advisor, shares how Catholics of great or small financial means can invest and spend in ways that give witness to Jesus Christ and build up Christ’s kingdom on earth.
There’s a common misconception that making money in a capitalist economy and living out your Catholic faith are separate issues, or that we can’t expect people to make decisions in a capitalist economy in line with their Catholic faith. What are your thoughts on that?
There is unquestionably an incredibly powerful link between how you use your wealth and how you make it. Our financial life tells a story. It tells a story about what we care about. It tells about what we prioritize, whether or not we're intentional with what drives our decisions. And I think that's true of our investing, our spending, and our giving. And so in the relationship between capitalism specifically and how we use our money, I'm perhaps more concerned with the way that we use our wealth. How do we use that in ways that glorify God? How do we use every dollar earned, spent, invested, and gifted as an intentional force for good? There's a lot that's been written in Catholic social thought and Catholic social teaching that indicates our financial decisions are moral actions. In one of the courses I teach we talk about John Paul II in [his 1991 encyclical] Centesimus Annus, saying the decision to invest in one place rather than another, in one productive sector rather than another, is always a moral and cultural choice.
I’ve been struck in how Benedict XVI and Pope Francis keep up that refrain in their own writings. What are some of the ways that Catholics can invest their money as moral choices that reflect where their faith is? How do you recommend people go about this?
As far as investment goes, the US Conference of Catholic Bishops has their socially responsible investment guidelines that are written more specifically for the USCCB -- it's kind of an internal policy -- but I think those could be applied to individual investors as well. The three key mandates, if you will, are one, “do no harm;” two, “actively participate;” and three, “promote the common good.” And so, specifically within the document, within the context of promoting the common good, it says investments that promote community development, which in some cases may result in a lower rate of return, but which nevertheless are chosen because they give expression to the Church's preferential option for the poor or do some truly significant social good.
That's not to say the USCCB is saying that promoting the common good is the only the only investment consideration or investment thesis. There are other factors at play. I think its kind of impossible as to say how specifically families should do that. Because each family's financial circumstances are so unique that depending on their financial means, their financial life, some investments are going to be more possible or more appropriate than others. And depending on one’s financial realities, it opens or closes all kinds of investment possibilities and options.
What are some ways that you've seen Catholics use that power of investment to change economies for the better?
As a starting point, you’d ideally want to look at every investment, and say “how do I make this investment something that contributes to the common good, that enables human flourishing?” Many people do that through screening out investments that violate their moral principles.
Or it could be through more actively participating in the governance of privately or publicly held and owned businesses.
Ideally, especially within the landscape of private investment, every investment is being assessed through the lens and looking at what can we do to specifically to promote the common good. A lot of Catholic entrepreneurs and investors that I know, regardless of whether it's a relationship with a coffee plantation or something more specific in the supply chain, or whether it's developing some new technology for the domestic market, they're always looking at it through the lens of love and service. “How can we serve society?” “How can we enable flourishing?” “How can we enable the common good?” The investors and the entrepreneurs that I know are looking at every kind of investment through that lens.
Let’s say I’m an investor in a company: how do I use my influence or ability to make sure its supply chain is pretty clean, ethical, and aligns with my Catholic values from start to finish?
Once again, it really depends on the realities of each family. If you own a billion dollars worth of Microsoft, or Proctor & Gamble, your level of influence over the company is going to be a lot different than if you own a thousand dollars in a mutual fund or ETF [exchange-traded funds]. So radically, it depends massively on the nature of the investment and the nature of the investor. Now that being said, there are a growing number of investment options for, let’s say, “everyday families” that apply the USCCBs moral principles to investments. There are also growing avenues to actively participate. As an owner [or shareholder] of a business you have a vote in things, so there's a growing ability to delegate your voting to entities that will vote in alignment with your moral principles. So for example, there are Catholic proxy voting groups. So if you're an owner of a publicly traded company, you can delegate your voting to a Catholic voting agency, a Catholic voting body basically.
So to bring it back to the USCCB’s guidelines of “doing no harm, actively participate and promote the common good, there are a growing number of investment vehicles available to everyday families and families of significant financial capital that do no harm, there are growing channels to actively participate through either direct voting or delegating your voting to the appropriate proxy, or lastly there are growing funds available with a unique mandate to attempt to promote the common good available to both ordinary, everyday families and families with significant financial capital.
So how does a Catholic apply these principles to one’s own purchasing power?
I go back to that teaching of St. John Paul II: the decision to invest in one place rather than another, and one productive sector rather than one other, is always a moral and cultural choice. And might we say the same thing about spending, about where we purchase things from? And I think that you can. I think you want to be careful about the danger perhaps of being overly scrupulous. But I think the way that we spend our wealth tells a story and to the degree to which we can align each dollar spent with our values, and each dollar spent as a force for good, all the better.
Might you enjoy that sip of coffee more, if you knew it was brewed by a family that you know is being enabled by your purchase to really flourish and grow? I think absolutely. There’s a group called Generous Giving – it’s an Evangelical Christian group with a wonderful, wonderful ministry – and one of lines that I heard through Generous Giving was “we must live in the kingdom of God in such a way that provokes questions for which the Gospel is the answer.” And might our spending kind of provoke the kind questions to which the Gospel is the answer? I would certainly hope that's the case.
I think we're seeing a growing awareness of the power of our spending. With the most recent Netflix debacle, we were seeing a growing number of Catholic families and Christian families all over the world canceling their subscriptions over a show that was pretty offensive to Catholic values. So I think our spending absolutely can be viewed through that lens of our spending is a moral choice.
What moral aspects of that spending choice should a Catholic keep in mind?
I think there's two elements to the spending: one, is “who is this going to, what is this money being used for”? But then the second question is, “should this money even be used for this?” For example, as Catholics and Christians, we believe that we’re not really owners, we’re stewards, and that there is this universal destination of goods: that each dollar that I've been entrusted with has been entrusted to my care for the wellbeing of my family and of society at large. So you can view every purchase, large or small through the lens of “is this a stewardship purchase?”
Do we have a responsibility to use our power of investing and purchasing to build up the local community around us? How should we prioritize these decisions in relationship to the community and area in which we live?
I think so. That relates to the principle of subsidiarity. You might say there’s growing circles around us. There's our spouse, our children, our extended family, our internal tribe, our neighborhood, our community, etc. And can and should we use our wealth to support our community? Is it more important that we do that then say go straight to the international level. There's certainly an argument for that. I think one of the best books that's been written on wealth and wealth management as a Catholic and a Christian is by Catholic philanthropist Frank Hanna. One of the things he talks about is the “principle of indispensability.” He talks specifically with giving, but might there be a relationship to our spending as well? I think probably so. Support defensible causes to which your support is indispensable. Instead of giving to massive, large organizations, perhaps there's that person that's always on the corner of the street after Mass that is hungry and needs a granola bar, water and just wants someone to say “hi.”
Might that be true of our spending as well? I think it certainly could be. Obviously, we live in a global economy, so how you do that I think is up to the discretion of each individual family. But there's a growing awareness and interest for it. Even just something as simple as a farmer's market for local produce. A lot of families are growing in their desire to support local farms or eat locally. A lot of families are growing in their desire to support local economies, whether it's the local coffee shop or the local brewery. I've talked to a lot of families, even the town that I live in that, while coronavirus hit, they intentionally ordered out more as a family to support the local restaurants, which they knew were really suffering. Are there ways to use your spending to support the local economy? I think there surely are.
In the final analysis, how should we look at our spending decisions, whether investing or purchasing, in relation to what happens to our immortal?
It comes back to first principles, which is God provides wealth, so that we can use wealth as a tool. It's “a tool, a test, and a testimony,” to borrow the phrase from Ron Blue of Kingdom Advisors, another wonderful organization. It's a tool that we can use to build his kingdom. It's a test. And, it sure can be a testimony. Once again, we want to use our wealth for the Kingdom of God in such a way that it provokes questions to which the Gospel is the answer. I do believe that when we stand in front of the Pearly Gates we're going to be asked to give an account of how we used every minute of our day, and I think that's also true with how we used each dollar we were entrusted with. There's kind of a mandate [from God] to grow and be fruitful. So once again, our wealth tells a story. At the end of our life, our wealth will tell a story about what we care about, what we prioritize, how we made decisions, what drove our decisions, our investing, our giving, our spending. And I think the hope of every family should be that every element of their financial life reflects their values, priorities, aspirations, as individuals, as humans, as families, but also as Catholics and Christians.