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Page 2 - Putting faith in engagement
In a sign of 3iG’s financial importance, presentations at the Washington meeting included future investment projections by the World Bank as well as disease prevention research from the World Health Organisation.
The 3iG board, which was formally set up in April 2005 under secretary general, Joost Douma, a former EU regional development head, meets twice a year and holds conference calls every month. Hardon says many of its larger member organisations, such as the Catholic and Methodist churches have highly proficient finance departments. The idea – straight out of most faith texts – is that the strong shall help the weak.
Hardon says the work of the New York-based Interfaith Centre on Corporate Responsibility (ICCR) has also been an influence on 3iG’s engagement tack. The ICCR represents 275 Protestant, Catholic and Jewish institutional investors with combined portfolios worth an estimated $100 billion and is highly active in the area of governance and shareholder activism.
Hardon says it is an active approach by faith investors which is not seen often in Europe: “One of our discussions is whether we might take up a similarly vigorous lobbying approach in the next five to ten years.”
For Hardon, the most important aspect of his work is to bring faiths together through finance.
“As an example, we recently had the chief economist of Bank of Israel at a seminar with other faiths including a representative of the Shinto religion, to debate the topic of microfinance funds.”
On a more practical level, he says the Lutheran Church in Sweden owns about 8% of the country’s forests along with the relevant husbandry and financial management
skills. They export this expertise to churches in Mozambique to create sustainable and commercially viable tree plantations. He says such skill sharing opportunities also exist in sectors such as water purification, renewable energy and sustainable housing.
“These are the partnerships we seek. Most faith organisations have huge pension funds to be invested for the long term. At the same time, beneficiaries expect a healthy annual return, so we have to find as many win-win situations as possible.”
Microfinance is highly topical since Bangladeshi economist, Dr Mohammad Younus, won the Nobel Peace Prize in 2006 for his work with Grameen Bank lending to the poor of Bangladesh. Hardon says the World Council of Churches has also been active in the field and will expand its activities: “We have a credit group with assets of some €300m in assets which has been investing for some decades in micro investment. We are in the process of finding more organisations to work with us, but we have to be careful. We have been approached by many international banks to work on these projects and we need to be sure of who we work with.”
One major goal of 3iG is to keep expanding the participating faiths. However, such important changes to faith investment are not without resistance: “Our view is that as faith groups we should be getting a good return on capital and we stand by the studies showing that some responsible investment strategies can give better returns. It’s not always an easy debate to work through within faith groups, but is a fascinating one. I, and the World Council of Churches, see this as missionary work, and churches live for missionary work!”
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