Thursday, 5 September 2013
Church Commissioners' ethical investment policy
The Second Church Estates Commissioner answered a written question in the House of Commons yesterday on the Church Commissioners’ ethical investment policy.
Posted by Peter Owen on
Thursday, 5 September 2013 at 2:53pm BST
Helen Goodman: To ask the hon. Member for Banbury, representing the Church Commissioners, what the category limits are of the Church Commissioners’ ethical investment policy.
Sir Tony Baldry: The Church Commissioners are advised on ethical investment policy by the Church of England’s Ethical Investment Advisory Group. In directly held investments, the Church Commissioners avoid investment in companies involved in indiscriminate weaponry and, if their strategic military supplies exceed 10% of turnover, in companies involved in conventional weapons. The Church Commissioners do not invest in companies that derive more than 3% of revenues from the production or distribution of pornography, nor companies a major part of whose business activity or focus (defined as more than 25% of group revenues) is tobacco, gambling, alcoholic drinks, high interest rate lending or human embryonic cloning. Where the Church Commissioners are not able to invest in an asset class directly they do so indirectly (in pooled funds). In indirectly held investments, where the Church Commissioners usually cannot fully implement their ethical restrictions, exposure to businesses operating in excluded sectors is monitored. If the level or nature of exposure to excluded sectors in any one fund becomes unacceptable, the Church Commissioners review the options for remedial action.
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Although I appreciate the problem of diversification and keeping track of which companies are diversifying into which markets, but am I the only person who thinks it is absolutely outrageous that the C of E invests in any company with any involvement at all in pornography, production or distribution?
Having once been a part of a group in which Michael Colman (I think it was he) was addressing us about the C of E policies for investment, I interrupted him because I could not believe my ears when he said (and this was some time ago) that they invested in the arms trade. He explained their involvement in terms of 'they only invest in the good companies, where the arms would not be used' etc. etc. etc. I thought we had persuaded the Church Commissioners to disinvest but it seems they have a 10% rule. This must be changed to a 0% rule.
Pornography and arms. No wonder I sit very lightly these days to involvement with the Anglican Church.
I hope that you are the only one outraged Anne.
The Church Commissioners explained on the Radio 4 Today Programme at the time of the last flap on this subject that were they to take a simplistic absolutist view, then they would be restricted from investing in - for example - almost every hotel chain in the world.
Almost all hotel chains are involved in the distribution of pornography through their in-room TV services' adult channels.
That is what the 3% threshold is about.
As for the arms trade, self-defence and providing the Royal Navy with effective ships seems thoroughly ethical to me.
We can argue about bits at the edges, sure - but I think that campaigners of this type are too puritanical for their own good.
Thank you Anne. We all have to face, however painful, that the Church of England, is not ethical in its investments, as in many other matters.
I agree wholeheartedly Anne. But also, I find the negative way in which the "ethical" investment policy is expressed rather depressing and terribly old fashioned. You would never think that there's a whole range of "ethical" investments of various shades out there, some of which look a good deal more ethical than the CCs. What investments do the Church Commissioners think will improve our world?
What we all do with our money is all too rarely rarely discussed in the Anglican church.
Exactly, Matt. This is exactly why I do not invest in any hotel chains. The last time I heard Mr. Whittam Smith, first church estates commissioner, speaking he said their remit was to maximise income. If I have the opportunity of maximising my income by investing with a Colombian drug baron, guaranteed interest of 200%, I do not take it. We need an entirely different way of understanding how we are good stewards of our money. Maximising our income is not it.
Laurence, it is painful that the Church of England is not ethical in its investments as well as in other matters. But we must not sit back and allow it to remain so. Salt and light spring to mind. Salt in a wound is painful, but I understand it can help it to heal.
Helen, you are absolutely right, we need a new perspective to help us encompass 'ethical' positively. Thank you for thought.
An interesting response. I respect your consistency, but think you are badly mistaken.
Your position attracts some hard questions:
If you pursue your strict policy who is left to invest in from, for example, the FTSE 100 large companies. The list is here:
If you knock out:
- Supermarkets (sell Lad's Mags and such as Cosmo that play with young girls' minds)
- Commercial Banks
- Obvious Arms Trade links
- Alcohol (what about Whitbread or M&S who sell wine?)
you have only about half left made up of Finance, Property, Utilities, Services, Insurance, FMCG.
What does such a policy look like?
And how much (percentage) would you expect retired vicars to lose in income in order to pay for it?
"you have only about half left made up of Finance, Property, Utilities, Services, Insurance, FMCG.
What does such a policy look like?" Matt
I'm guessing a portfolio made up of investments in Finance, Property, Utilities, Services, Insurance, FMCG.
Well ... I'd have thought that of those:
Property involves 'exploiting' tenants through market-based rents and profit.
Finance ... see banks.
Utilities ... basic human needs should not be subject to the profit motive.
Services ... tends to be people like G4S
FMCG ... is Unilever and Proctor and Gamble.
I'd have thought that Anne will end up with the Co-op and similar.
I don't think it works, and I'd also say that it is highly unethical if you make pensioners suffer to salve your conscience.
I really would like an answer from Anne.
Where would you find a finance,an insurance company or a utility who was not also working for any of the other clients you've just dismissed as being unethical?
Matt, I agree very much with your comments. Retired Vicars get a pittance of a pension and I don't see why this should be further reduced because some people would like a whiter than white investment policy in a world which is painted in shades of grey.
Also Just Wars and the Armed Forces required to fight them require Just Weapons.
Oh dear. The Independent reports that the CofE has investments in a company that makes drones and other nasty war machines.
"Retired Vicars get a pittance of a pension"
"...require Just Weapons"
Last time I looked, it was a pretty good 'final salary' scheme.
I'm not a Christian so perhaps I don't know what I'm talking about, but the idea of "Just Weapons" doesn't sound terribly Gospelly to me.
>Where would you find a finance,an insurance company or a utility who was not also working for any of the other clients you've just dismissed as being unethical?
That would be a question for Anne above, who has advocated a puritannical approach.
I'm just trying to work through the implications of the suggestion.
My view is that an extreme "ethical" policy is itself likely to be unethical.
But she seems to have vanished ;-)
Perhaps that is only temporary.
The conversation proves that money corrupts. It sounds as if our priests would much rather serve Mammon.
Deny the faith, deride their heroes, unholy the holy water, if you like . . .
. . but don't you. touch. that. pension. They get really hot about that.
The servant is so much better than the master, after all.
I didn't mean to criticise you, sorry! I meant to take up your argument and add another thought to it.
Your last point, whether being extremely ethical does not also make you unethical, is a very important one. All purity taken to extremes causes as much injustice as it removes.
as a German I will forever be grateful that there were weapons and people willing to risk their lives to free the world from Hitler.
The question is not whether there can be just war or just weapons, but whether any particular conflict come into that category.