A Livable Future Investment Framework

At the Francesco Collaborative, we routinely set out to accompany faith-filled organizations and people who long to be prophetic with their investments. Time and time again, we’ve come to understand that integrating our deepest held values, beliefs, and commitments with our finances is not a “project.” It’s a journey. It requires us to look squarely at our experiences, convictions, and paradigms – and to open ourselves up to the discomfort and beauty of change and new ways of thinking. Much like the prophets of scripture, the work invites us to “sojourn” to new lands, the lands of a “livable future” and “Faith-First” investing.

For a journey to be fruitful, we need a sense of direction, even as it continues to evolve. While the future carries tremendous uncertainty, we can still lean into emergence with intention by reflecting on where we are, where we are going, and who will be traveling with us along the way. 

This is why we crafted our Livable Future Investing Spectrum: to help us visualize what it means to journey from an investment approach rooted in “capital supremacy” – one that perpetuates extraction, builds structures of sin (the structures and processes that emerge from recurring, individual choices to extract from, exclude, and exploit our neighbors), and concentrates of power and wealth – to an approach that is authentically “Faith First,” which we define as focused on repair and rooted in right relationship.

Through this spectrum, we try to answer the question: what are the signposts of “Faith-First” investing, and how do we move closer to it? 

In September of 2022, our team gathered with Pope Francis in Assisi and took to heart his message: “Our capitalism…wants to help the poor but does not respect them; it does not understand the paradox in the beatitude: ‘Blessed are the poor’ (cf. Lk 6:20). 

Reflecting on this call to foster mutual respect and economic agency, we began to appreciate that the prophetic dimensions of “Faith-First” investing are not just about “what” we invest in, but also “how” we invest – what ethic and relationships structure our investments and animate our approaches? As Nwamaka Agbo, CEO of the Kataly Foundation and Managing Director of the Restorative Economies Fund (REF), notes, “It will take all of us, working together, to develop solutions that repair the harm caused by that system and begin to restore both people and the planet.”  

A “Faith-First” approach to investing fosters human flourishing on a healthy planet, while building the relationships and creating governance structures that enable power and wealth to be equitably distributed.

 Our spectrum axes represent these two “signposts” of “Faith-First” investing.

The first signpost, represented by the horizontal axis, is fundamentally about “how” we invest. It’s about our paradigm, or the “ethic” that underlies the investments we make. An ethic is a set of moral principles – we express our ethic in the way we do things. It is all about adverbs: do we structure our investments justly, communally, joyfully, fairly, with our commitment to Catholic Social Tradition and its emphasis on solidarity, subsidiarity, and the preferential option for the poor in mind? Do we live and invest according to an ethic of capital supremacy, one that seeks to maximize profit, externalize risk, and extract value above all else? Or do we live and invest according to a Faith-First ethic, one that emphasizes non-maximization, relationality and repair, and participation?

This signpost moves us to expand our understanding of returns to include non-financial considerations like outcomes that pursue the common good and contribute to local, thriving communities. It helps us move beyond strategies that solely focus on preserving wealth and power at the expense of the earth and the poor. It also helps us expand our understanding of “fiduciary duty,” which, as it is currently constructed, allows conventional investors to pursue social or environmental impact objectives only instrumentally and not as ends to themselves. 

Here, embracing a Faith-First ethic requires an understanding of sufficiency. It requires that we ask and answer an essential question: “What is enough?” 

The second signpost, represented by the vertical axis, is about “what” our investments create. At its core, it is about relationship. This signpost points us toward a culture of liberation and redistribution and moves us to share power, act in community, and liberate others from unjust structures. Here, we can ask, “what does our investment do to others?” or, “what does our investment say about our relationship to others?” Does it build structures of sin that degrade the earth, dehumanize workers and the poor, and exclude others from wealth-building, or does it move us toward “right relationship” by honoring human dignity, restoring the earth, and prioritizing the poor?

This axis invites us to consider how we can journey toward being relationship-based in our investment activities. Being relationship-based means that, as we engage with investment decisions or directly with investee partners, we make an effort to practice transparency in order to reduce information asymmetry and inequities. A relationship-based approach also finds ways to more fairly distribute risk and return. Embedded in the “structures of sin” at the bottom of the vertical axis is the temptation to exclude others and hoard resources for ourselves – a relationship-based approach might, instead, cap investor returns in order to distribute more to a broader group of stakeholders, or it might structure an investment in a way that directly bakes in benefits for communities.

At the heart of this framework and its call to prioritize relationships and new “ethic” is the idea of “integral ecology”, expressed by Pope Francis in his 2015 encyclical Laudato Si’. “Integral ecology” expresses the reality that everything is connected. Our spirituality, our day jobs, our investment decisions, our consumption habits, our philanthropy – everything we do and everything we are has an impact on the earth and the poor:

 “We are faced not with two separate crises, one environmental and the other social, but rather with one complex crisis which is both social and environmental. Strategies for a solution demand an integrated approach to combating poverty, restoring dignity to the excluded, and at the same time protecting nature” (Laudato Si’ 139).

A “Faith-First” approach to investing calls us to recognize, as investors, the capacity each of us holds to catalyze the restoration and repair our planet and communities so desperately need.  As Edgar Villanueva notes, “If we could use money in a different way, towards a healing, reparative purpose, then money actually can be sacred, something that could be used as medicine.”
It is up to us to create this different way, this different ethic – and to “incarnate it,” as Pope Francis writes, together.

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