In his World Youth Day address of 2015, Pope Francis echoed the teaching of Pope Benedict when he posited that “Purchasing is always a moral – and not simply an economic act.” With this observation, he set the stage for a newly released Vatican document that calls Catholics to carefully consider the investment choices they make in their lives.
Issued by the Vatican’s Pontifical Academy of Social Sciences, the document outlines “faith-based measures for Catholic investors.” Mensuram Bonam (Good Measure), a 46-page guide to making wise and morally acceptable investment choices, urges investors to consider the values delineated in the Gospel and Catholic Social Teaching (CST) when choosing a corporation in which to invest.
The document has been in development since 2016, when a working group of about a dozen economists, relying on over 60 experts in various fields related to finance, investment and ethics, crafted the beginning of a Vatican statement. The working group submitted their report in 2020; but publication was delayed until this year when a final revision was completed. The final document Mensuram Bonam is, according to the Foreword, “part of the tradition of Church initiatives seeking to dialogue with the human family about its various experiences and challenges.”
Among the positive criteria outlined by Mensuram Bonam are values such as social justice, respect for the human person, including the weakest among us, and respect for the common good. The statement also encourages investing in corporations which place a high value on preservation of the environment.
Mensuram Bonam also cites 24 exclusionary criteria – factors which make a potential investment unacceptable to faithful investors. These exclusionary criteria fall into four categories:
- Intrinsic dignity of human life. In this category are investments which support abortion, armaments, nuclear weapons, capital punishment, contraception, embryo stem cell research, and animal experimentation.
- Patterns leading to addiction and abuse. Among these patterns are addictive substances or services, dehumanizing computer games/toys which encourage violence, and pornography.
- Global impacts and sustainable development. Areas of concern include breaches of labor law, corruption, discrimination, human rights violations, the overlooked rights of indigenous peoples, totalitarian violence and oppression, and unfair/unethical business practices.
- Environmental protection. Included here are investments in stocks supporting climate change, exploitation of the environment, food and agricultural commodities, green/genetic engineering, hazardous chemicals and climate damaging substances, mining and mineral commodities, and clean water.
Dr. Samuel Gregg is a Distinguished Fellow in Political Economy at the American Institute for Economic Research, an affiliate scholar at the Acton Institute, and the author of several books, including The Next American Economy. He talked recently with Catholic World Report regarding Mensuram Bonam.
CWR: The Pontifical Academy of Social Sciences, which released the document last month, had relied on over 60 experts in various fields to craft their statement. In your opinion, how well does Mensuram Bonam articulate Catholic social teaching and theology?
Dr. Samuel Gregg: Mensuram Bonam represents a significant improvement on previous semi-official Catholic forays into the area of the ethics of investment. I’ve always thought that the Chancellor of Pontifical Academies of Sciences and of Social Sciences, Cardinal Peter Turkson, has a much clearer understanding of the particularities of things like business and finance than some of his confreres, and I suspect that this document reflects that.
God, Christ, and the demands of Catholic faith are in the front and center of the analysis of Mensuram Bonam. The document also reflects the input of faithful lay Catholics who understand the world of business and the insights into reality offered by the social science of economics. The first chapter is particularly strong in this area.
That reflects, I imagine, the efforts of working group members involved in the drafting of Mensuram Bonam like Robert G. Kennedy, Pierre de Lauzun, Jean-Baptiste Douville de Franssu, and Stefano Zamagni, all of whom have written extensively on these matters.
CWR: Is Mensuram Bonam too highly politicized in some areas?
Gregg: The document doesn’t strike me as especially political. Yes, there are the usual invocations of climate change that everyone apparently feels to obliged to echo these days. But even these don’t reflect the alarmist and apocalyptic rhetoric that usually surrounds that subject.
I also liked the fact that the document recognizes that there are limits to what private and institutional investors can know about what is happening in the marketplace at any one time. Such limits don’t let us off the moral hook, but they don’t often get acknowledged in much of the ethical investment literature.
CWR: Do you have any concerns with this document?
Gregg: There are two things about Mensuram Bonam of which I am critical.
One is its approach to ESG (Environmental, Social and Governance) investing. The document, albeit with some reservations, sees ways in which Catholic Social Teaching can be integrated into ESG approaches to investment. But in a number of places, I and others have argued that ESG is internally incoherent, is extremely susceptible to various woke agendas (which are usually incompatible with orthodox Catholic ethics), fosters virtue-signaling that often serves to disguise serious wrong-doing inside companies, undermines the legal accountability of directors and managers to shareholders, and tends to result in businesses morphing into an odd and ultimately unsustainable combination of lefty-NGO and commercial enterprise.
There is also growing evidence that the measurement criteria typically employed by ESG funds and approaches are unstable and inconsistent in their application. The Church has, I would argue, very little to learn from ESG because of these and other problems with its genesis, design, and implementation.
My second critical observation concerns the absence of any substantive reference to scholastic thought and reflection on questions of money and investment. Catholic moral theologians wrote extensively about finance, banking, and money between the 12th century and the late seventeenth century, and many of the insights they developed could easily be applied to investment questions today. I would have liked to have seen more of those insights applied and referenced in this text.
CWR: How much of an effect do American business practices, such as ethical investment platforms, influence the global economy? At this point in history, do world nations turn to the United States for leadership in the area of business operations?
Gregg: American business practices, for better or worse, are immensely influential in the global economy. That is partly because of the importance of American business schools, as well as the sheer size of the American economy. Many people come to America to study in American business schools or to work in American companies.
This has its pluses and minuses. America remains the world’s most entrepreneurial nation, for example, and the world needs more entrepreneurship. Others can learn from America in this area. At the same time, much of corporate America—especially large corporations—seem especially in thrall to any number of agendas that promote objectives at odds with Catholic ethics. The “woke-ification” of much of the American business world is a serious problem, and it is seeping into other businesses throughout the world.
CWR: You write in your new book that today, many want the government to play an even greater role in the economy — by means of protectionism, industrial policy, stakeholder capitalism, and quasi-socialist policies. Is that what’s going on here?
Gregg: Stakeholder capitalism, I would argue, reflects long-standing efforts to undermine the legitimate freedom of business, not least by unduly compromising the primary responsibilities of publicly traded companies to their shareholders.
Moreover, there are efforts now to effectively mandate some type of stakeholder understanding of business via government institutions like the Securities and Exchange Commission. Trying to force ESG onto companies forms part of that agenda. It’s one thing for a person to freely choose ESG for themselves. If someone wants to invest in an ESG fund, they are free to do so. But it’s quite another thing trying to force others to do so.
CWR: If you were to list your own personal priorities for ethical investing, are there other considerations which would shape that list?
Gregg: One of the most fundamental features of Catholic moral teaching is that it is never permissible to do evil that good may come of it. There is lots of room to discuss the various goods that investment can realize, but that is for naught if one’s approach to investment is essentially that of a consequentialist.
Hence, rather than adding more specific issues to the list, I think that we need to work to ensure that many more Catholics involved in business and investment are more deeply formed in the Church’s moral teaching – for that is the foundation upon which any Catholic reflection about the rights and wrongs of investment must be built. Mensuram Bonam does a better job at outlining much of this foundation than a good number of other Catholic documents about ethical investment. But I would argue that it could be further enhanced by a more thorough grounding in how Catholics should think about the morality of any freely chosen act.
After all, any investment involves a free choice; and it is in the workings of free choice that we either become virtuous or slip into vice. Here, I would recommend reading some of the cases studies on ethical dilemmas in business that are listed in Volume Three of the late Germain Grisez’s The Way of the Lord Jesus. These case studies are very helpful for understanding what it means to work in business and invest in the marketplace in ways that concord with the demands of faith and reason.
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