Biblically Responsible Investing (BRI) is the intersection of faith and investing, where you can be confident you are putting your money where your heart is. This type of strategy combines values-based investing and impact-based investing with faith-based values. Using these principles, faithful stewards can know their investment portfolio aligns with their hearts, and—even more—try to change the world for the better as they strive to build a lasting legacy.
As an investment strategy, Ambassador Advisors believes investments that do not follow biblical values bear additional risks not compensated by markets, and, therefore, avoiding these investments aligns the desires of the investor and the faithful steward.
Values- and impact-based investing can fundamentally be broken down into three parts: avoiding companies whose policies violate personal beliefs, investing in good ‘stewards’, and using our investments to influence companies for the better.
BRI seeks to avoid companies that are incongruent with spiritual values. Investing in a company can be seen as showing support for the company. Supporting companies that work against Christian values can pose a dilemma for those holding a faithful heart. This incongruency can come from what a company makes (their product) or does as a business line (their services), in addition to what charities they support, or the policies or practices they implement. To put this in perspective, violating human rights is a core incongruency with BRI. Similarly, a company that operates using slave labor would be a conflict. BRI encompasses faith-based values that many companies champion and respect.
Secondly, BRI seeks to invest in companies that demonstrate the values of faithful stewards. Companies showing stewardship are companies that display Christian integrity in their business practices, donations, and policies. These values may be evidenced in using best industry practices to avoid pollution or promote worker safety, donating to charities teaching STEM to underprivileged children, or lobbying for policies supporting fair workplace practices for mothers and pregnant women. There are many ways to show the values of stewardship, and each helps faithful stewards see the differences their investments can make.
The impact side of BRI focuses first on the assumption in finance that by keeping an investment from ‘sinful’ or conscious-violating companies, while also supporting ‘stewards,’ the cost of capital for the unclean companies will increase, making it relatively more expensive for them to do business. In theory, over time, the pressures of increased cost of capital to these businesses espousing such conflicting practices will make them less competitive with companies acting as good ‘stewards.’ This will ultimately push them to change their hearts or struggle to compete.
Additionally, BRI can cause investors to encourage companies to follow faithful values with the opportunity to receive investments from faithful stewards if they do. In this way, faithful stewards are empowered to use their investments to change the world for the better.
From an investment perspective, in applying BRI, we believe that behaviors of companies that conflict with our values pose a source of risk that is not compensated. Therefore, prudent investment strategies demand that we instead seek compensated risk that investors are both willing and able to bear. Accordingly, we believe excluding companies engaging in ‘sinful’ conduct focuses the investment process on companies with a compensated risk profile.
An investment strategy that uses BRI principles and values is the core of the Ambassador Advisors investment process. Knowing your money is aligned with your heart is one key step faithful stewards can take on the road to building a lasting legacy.
Any opinions expressed in this forum are not the opinion or view of American Portfolios Financial Services, Inc. (APFS) or American Portfolios Advisors, Inc.(APA) and have not been reviewed by the firm for completeness or accuracy. These opinions are subject to change at any time without notice. Any comments or postings are provided for informational purposes only and do not constitute an offer or a recommendation to buy or sell securities or other financial instruments. Readers should conduct their own review and exercise judgment prior to investing. Investments are not guaranteed, involve risk and may result in a loss of principal. Past performance does not guarantee future results. Investments are not suitable for all types of investors. To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purposes of avoiding penalties that may be imposed by law. Each tax payer should seek tax, legal or accounting advice from a tax professional based on his/her individual circumstances.
This material is for informational purposes only. Neither APFS nor its Representatives provide tax, legal or accounting advice. Please consult your own tax, legal or accounting professional before making any decisions. Information has been obtained from sources believed to be reliable and are subject to change without notification. The information presented is provided for informational purposes only and not to be construed as a recommendation or solicitation. Investors must make their own determination as to the appropriateness of an investment or strategy based on their specific investment objectives, financial status and risk tolerance. Past performance is not an indication of future results. Investments involve risk and the possible loss of principal.