Moral Perspectives

Morally Responsible Investing

by George P. Schwartz, CFA | June 7, 2021

Wise investment management is a moral imperative. Why? Because prudent investing is essential to meeting future needs and community needs, particularly through charitable giving. But there is another, perhaps more subtle moral dimension. When we invest in a company, we become an owner, and our investment contributes to the company’s success. Are we comfortable with what we own? Does the enterprise reflect our core beliefs? If not, what opportunities exist to invest in a manner that does reflect these beliefs?

Morally Responsible Investing or MRI is about participating in the capital markets in a purposeful, reasoned, and ethical way to achieve legitimate investment objectives and avoid morally objectionable businesses. In this blog, I will acquaint you with an approach to prudent and potentially profitable investing that can help provide for your future, accumulate reserves for charitable giving, and achieve other financial objectives.

Investing is a critical component of financial management carrying with it the obligations of productivity and the exercise of sound judgment. I believe my methods are based on well-established investment practices that are ethically valid, entirely practical, and financially astute. I will include real life investing outcomes to illustrate my assertions.

It would be silly to claim that only good, moral, and religious people can succeed at investing. There are numerous examples of dirty rotten scoundrels who have made killings in the stock market. Yet, there is a relationship between conviction in spiritual matters and acumen in analyzing investment opportunities. That relationship lies primarily in two areas: (1) an ability to see beyond surface features; and (2) a willingness to dedicate oneself to disciplined practices over time.

By what authority do I offer advice on morality? I am not a priest, rabbi, or theologian. I’m a grateful Catholic convinced by the truth, beauty, and goodness of the Catholic Church. While I do not speak for the Church, I draw from the Catholic intellectual tradition and the Judeo-Christian tradition.

My primary credential for offering advice on Morally Responsible Investing is that with the help of my colleagues and the Catholic Advisory Board, my firm started and manages the Ave Maria Mutual Funds – the world’s largest family of Catholic mutual funds, with nearly $3 billion in assets. The Catholic Advisory Board consists of individuals distinguished by their commitment to truth, excellence, and the Catholic Faith.

These mutual funds take a pro-life, pro-family approach to investing. We only invest in companies that do not violate core teachings of the Catholic Church as set forth by the Catholic Advisory Board. In particular, the Funds screen out companies that support abortion or pornography.

The moral imperative of wise investment management demands that we conduct our financial lives with the understanding that in all we do, we stand under the watchful eye of God. In the words of Pope Benedict XVI, “every economic decision has a moral consequence.” If you sense that the arguments I put before you are true, then I urge you to consider what they imply for your own investing.

Having talented, experienced investment professionals along with perseverance, patience, and perspective provides the basis for solid investment returns. This has been our experience.

Source: In God We Trust by George P. Schwartz, CFA with Michael O. Kenney, JD.

George P. Schwartz is Chairman and CEO of Schwartz Investment Counsel, Inc. and co-portfolio manager of the Ave Maria Rising Dividend Fund and Ave Maria Bond Fund.