BIBLICALLY RESPONSIBLE INVESTING (BRI) vs. SOCIALLY RESPONSIBLE INVESTING (SRI).... A REVISIT

Since the MMM was started some five years ago, it usually elicits some five to ten replies each week and they are truly an encouragement to me to keep sending them out.  But this topic took on a life of it's own as many people have been and continue to engage in dialogue about this topic.  The original MMM was NOT intended to be a complete and all inclusive treatise on the subject but merely to give some examples of how these efforts to screen investments by various bodies of believers and advocates have developed a group of followers.  Most of the responses to this topic have resulted in thoughtful expressions of both appreciation for the topic being presented and disagreements about whether the statements are accurate or go far enough in their emphasis.

The issues that both SRI and BRI advocates usually agree on are screens that will exclude companies who produce alcohol, tobacco, and gaming services.  This often constitutes as much as 50% of the stocks and bonds in a screened portfolio and yet is the most overlooked aspect of how much these disciplines actually have in common. 

There has been considerable comment from the BRI industry that my statements don't cover all the areas of concern, while many people who count themselves in the SRI segement of the industry have challenged the accuracy of some comparisons.  Most of their comments are very well stated and I believe that there are some clarifications that are in order to be accurate in the descriptions about both types of investing strategies.  My intent with this response is also intended to be brief and cover the highlight issues while I tackle this at much greater length in the book.  I have received permission to offer thoughts from the SRI point of view from Ellen Taylor, Executive Director of the Investment Management Institute.  Let me try to tackle them one at a time:

1.  BRI avoids companies that contribute to Planned Parenthood, while SRI invests in them and BRI avoids companies that profit from or promote abortions, while SRI has no such restriction. 

(Ellen Taylor from the Investment Management Institute who helps to stage conferences for faith based investors rightly points out that there are some groups who practice SRI but do have similar screens as the BRI providers on issues relating to Planned Parenthood and abortion.  They could include Catholic and Mormon groups as well as other faith based ministries.  Those groups have been practicing a form of SRI for many years and do not at this time use terms such as Biblical in their explanation of screening.  Other non-faith based investors in the SRI realm in fact may and often do invest in companies that support Planned Parenthood and Pro Choice alternatives.)

2.  BRI invests in companies that are responsible for supporting our military efforts, while SRI often avoids them. 

(Ms. Taylor points out that this is often the case and for many the same ideals that screen for abortions and pro life issues, keep consistency by also screening out companies that make weaponry and support warfare.  Again, this does not seem to be a Biblical issue for most SRI screeners but a social issue.  The exception would be groups such as Catholic nuns who have even gone so far as to screen out the use of Treasury securities as they represent as much as 40% of the federal budget for defense.  That is Biblical for them as the commandment "Thou shalt not kill" is paramount in their thinking. )

3.   BRI avoids companies that offer same sex benefits, while SRI invests in them.

(She agrees that some SRI screeners do indeed do this)

4.   BRI avoids companies that produce and sell pornography, while SRI might invest in them.

(She rightly points out again that some SRI screeners might indeed invest there but the faith based SRI participants that she is familiar with are very strongly in the same camp as the BRI providers and have strong screens against the pornography industry.) 

5.  SRI takes active roles in improving corporate governance, while BRI mostly ignores that issues.

(She agrees but also adds the same is true often in regard to environmental issues.  I agree with her point and consider that an oversight in my not including that in this MMM while I have devoted some considerable space to that issue in the book.)

6.  BRI emphasizes investment in adult stem cell research, while SRI invests in all forms of stem of stem cell research.

(This is the same exception as noted above in issues such as abortion, and Planned Parenthood, as many of the same faith based SRI screeners will break with other SRI investors and screen these items in the same way as BRI providers.)

Finally, I would like to deal with the issue that was raised that my presentation made it appear that if you didn't agree with the BRI industry you were UN-Biblical and so the idea of "holier than thou" reared its ugly head.  This never was and never will be a place where I will allow myself or others  to slip into that mindset.  If you received that message from me, I was wrong and I ask for your forgiveness.  BRI is taking the overt effort to try to apply Biblical principles to a worldly task, namely investing.  If we consider the Bible to be outside the realm of application there, because we as human beings cannot hope to be perfect with our investment choices, then why not ban it from all areas of our life. 

The very fact that some people wish to bring a Biblical application to this art form called investing, is no different than the man trying to live a Godly life by trying to follow the Bible's teaching for his life.  As I have learned from Ellen Taylor, SRI can be both progressive or restrictive, and as she will hopefully learn from people in the BRI arena, they can be also.  It is also true that investors from both SRI & BRI advocacy may be applying Biblical principles whether they use the term "Biblical" in what they do.  By communicating and sharing our concerns, the ideas of both camps can learn from each other and shine a light in both the mirror and the darkness of misunderstanding.

Just an aside, one of my favorite responses to the original MMM was from my brother.  He indicated that after reading my MMM he may indeed be more of an SRI investor than a BRI investor.  I applauded his openness and believe he probably does follow more of an SRI pattern in his thinking.  My sister would also agree with him but my other brother is likely more of a BRI investor.  Since there is room in my family for both, I think there will be room in the marketplace for both.  Thanks to all of you for your comments.  My only request is that you allow some of the questions to be answered in the book that I hope will be finished soon from my end.  God Bless, dls

Sent June 4, 2007

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