With all that happens in the world, why would God care about how people invest their money? Because God cares about everything. One of the ways God revealed His love for the world was sending Jesus to be the Savior for the world and teaching people how to live their lives. Jesus did not make it difficult to understand what God expects of people: love God and love each other. How people deal with money sometimes reveals where their love is—but not always. Some people do not make investment decisions because of their love of money. They make investment decisions because money is a tool within their lives, not the focus of their lives.
The late Reverend Billy Graham is famously known to have said, “give me five minutes with a person’s checkbook, and I will tell you where their heart is.” Where people spend their money, and where people invest their money shows their attitude toward the world around them. Owning the stocks of a company is partial ownership of that company. If you had to choose what kind of company to own, what would you prefer? Would you select a company that invests in sinful activities or a company that made money without going against the principles of the Bible?
The answer to that question seems obvious, of course; a Christian would not want to support sinful activity. However, identifying a company that does not participate in sinful activities can be difficult. There are nine factors that most Christian investors look for when trying to choose biblically responsible investments (BRI); corporate governance, tobacco, abortion, pornography, adult entertainment, non-biblical lifestyles, alcohol, and gambling.
Most Christians will look at this list and agree that any business involved in or promoting these activities are not biblically responsible investments. However, how can you find out if an investment is involved in any of these activities? There are three ways to find if an investment is being biblically responsible: research on your own, invest in a portfolio that specializes in BRI, or hire someone to research for you.
Let’s look at the first factor, corporate governance, and see what you would need to do to investigate it on your own. Consider the following circumstance: a top executive of a publicly owned company sets the rules of their company, including how he or she gets paid. In this example, the executive does not own the company; the person is hired to lead the business. The executive skews the rules of the corporation to give themselves a tremendous amount of money. Additionally, everything that they are doing is within the law. Is it right or wrong?
Just because an action is within the laws of men does not make it right within the eyes of God. Of the following two examples, which one do you think would be good in the eyes of the Lord? In 2015, “Hilcorp Energy, one of the largest privately held oil and natural gas exploration companies in the United States, announced that it would give all 1,381 employees a year-end bonus of $100,000.” In 2006, the CEO of Home Depot was paid $131 million dollars. Under his leadership, the company stock went from $40.39 on January 3,2006 to $41.00 on January 2, 2007 and had a dividend of $0.675. That is a total return of 3.18% for the year. At the time the average cashier made $9 per hour and, “Raises, when given at all, were capped at about 3 percent a year” (Kapner, 2007). Which company do you think was being run with biblical principles, Hilcorp or Home Depot?
It is evident that in 2006, the CEO of Home Depot was abusing his power to take money out of the company. If you were choosing which type of company to invest in based on biblical principles, it would be an easy decision to pick Hilcorp. The way it treats its employees follows biblical principles. Regretfully for investors, Hilcorp is a privately-owned company. However, the example it sets, by how it treats its employees, is a good one to follow. Not every company can give $100,000 bonuses, but they can treat their employees fairly.
In general, people do not publicize how they invest their money. How you invest your money reflects what is important to you. Executive compensation is just one factor to consider when trying to select a company that is run with biblical principles.
If you are researching on your own, some companies are obviously not biblically responsible investments and are easy to identify. With other companies, it takes time to investigate. You can further examine a company’s policies by investigating how a company gives its money away. Note that there is a difference between giving money that promotes a non-biblical objective and a donation that offers aid and comfort to a group. Some companies are involved in organizations to support the spirit of goodwill, not advance a non-biblical agenda.
If you do not have the time, training or interest to research investments, there are several mutual funds, exchange-traded funds and annuities that specialize in biblically responsible investments. It is estimated that between fifteen and twenty percent of companies that are in the Russell 1000 index are not biblically responsible investments. About 90% of the Russell 1000 represents the largest companies in the United States. Additionally, it is estimated that there are between twenty and twenty-five percent of companies in the Standard and Poor’s 100 index that are not BRI (Short, 2010). The S&P 100 is a narrower index that represents one hundred of the largest companies in the United States. A professional money manager that is specifically screening for BRI is perhaps better equipped than the average investor to screen out non-biblically responsible companies.
The third option to find biblically responsible investments is to work with a financial advisor that can help you be a good Christian steward of your personal finances and guide you to investments that meet the objectives of biblically responsible investments.
Another area of investing that is significant to people consists of retirement accounts set up through an employer. Most of the time employees do not control the options they have available within their 401(k) or another employer-sponsored retirement plan. If you do not have a choice over how your retirement money is invested, what do you do? There are many decisions that today’s Christians are faced with that did not exist when the Bible was written or within the time that Jesus was on Earth. However, some scriptures can relate to this and many other situations where there is no direct guidance from the Bible.
If you are looking for ethical guidance for today’s world, turn to Romans 14. This scripture was authored by Paul the Apostle. In the New American Standard Bible, Romans 14 is referred to as the “Principles of Conscience.” It was written at a time when people from various cultures were coming to Christianity. Paul did not want to let the less significant aspects of different cultures overshadow the good news of Jesus Christ. Today, Romans 14 is used in much the same way. If you have not read Romans 14, you should go ahead and do so.
In the case of choosing biblically responsible investments, you could look at Romans 14 and draw the conclusion that selecting biblically responsible investments is essential. However, it should not overshadow the cause of Jesus, as well as the commandments to love God and love one another. When it comes to a company-sponsored retirement plan, you may not have a choice of investments. In this instance, money that people put into their company retirement plan is not a choice of money over their beliefs. Money in this situation is being used as a tool to produce an income for retirement.
A company-sponsored retirement plan is created for the benefit of employees and it must satisfy the tax and labor regulations established by Congress. You have a limited choice of investments because of government regulations. In Romans 3, Paul the Apostle was writing to the Roman Christians to give them guidelines for following Christ. Romans 3 may also give you some guidance with your employer-sponsored retirement plan.
Imagine you were facing the dilemma of choosing a biblically responsible investment for your retirement plan and you were able to send an email to Paul the Apostle for his guidance. The email from you might go something like this: “Dear Paul, I am faced with a dilemma. I am a Christian, and I want to be sure that my retirement plan is not used to support non-biblical activities. However, the tax and labor laws of the United States limit what investments I can choose because my employer has already chosen for me. What should I do?”
Then imagine that Paul the Apostle writes back to you using the same words that he sent to the Roman Christians. The answer would go something like this: “Dearly beloved, in the matter of you deciding which investments to choose, consider the question in this way, ‘if we emphasize faith, does this mean that we can forget about the law? Of course not! In fact, only when we have faith do we truly fulfill the law'” [Romans 3:31, NLT].
If we study the Bible and pray to God, asking him to reveal the wisdom to make the right decisions in our lives, much will be shown to us. God does care about everything in our lives. He sent his Son to be our Savior and our guide. Plus, he left us a reference manual—the Bible.
–Van Richards is a Christian financial advisor as well as the founder of https://www.Advice4LifeInsurance.com and http://www.Advice4Retirement.com. Van draws from his 30 years as a financial advisor to write about financial issues from a Christian perspective. You can contact him at email@example.com.