What Are Your Investments Funding?

Posted: Sep 09, 2019 1:12 PM
What Are Your Investments Funding?

Source: AP Photo/John Minchillo

Recently on Christian talk radio, I heard a financial talk show host give the following reason for not embracing Biblically Responsible Investing. He said, “When I buy a stock in the market, I am not buying it from the company that I am investing in, I am buying it from somebody else, so the company I am buying ownership in is not getting the money; therefore, I am not profiting or funding them. Knowing that, why does it matter what the company does, as long as it is profitable?” 

At first glance, it seems like a logical argument. But it is only valid if the reason stated is the only reason a Christian would want to avoid investing in morally corrupt companies. By its wording, this question seems to assume that the funding of companies that profit from or produce products that are sinful, immoral or offensive to God is the only reason Christians should avoid investing in such stocks. 

But let's dig deeper to see if this is so. The term “stock” is short for “stock certificate.” It refers to the document used as evidence or proof of ownership in a corporation. Stock certificates state the name of the company, the number of shares the certificate represents, name of the person, date of issue, the CUSIP number and other information required by the law in force.

For a Christian, it is essential to understand that owning stock means you are an owner in a company. The more stock you own, the larger your ownership of that corporation. As an owner, you hope to participate in the profits made from the activities of the company. You also have certain rights such as are represented by the type and amount of stock you own, such as voting rights or the influence regarding leadership and control of certain activities of the company. 

Because you are an owner/participator in the profits, you also are a passive participator in the activities of the company. When you buy stock, you are effectively partnering with all the other stock owners in that company. Though you may not be held directly responsible for the actions of the company as a minority stockholder, you are a participant just the same. 

Let’s say for the ease of math that you own 10% of company ABC’s stock. If that company creates a cure for some terrible disease, you have the pleasure of knowing the company you have become a partial owner in created that cure. If you were sole owner, owning 100% of the company’s stock, you would be credited personally for making such a significant breakthrough and would reap the rewards of the possible profits from the patents, rights and sales of this great product. As 10% owner, you participate somewhat proportionately in such a breakthrough. 

The same unfortunately is true on the other side of the formula. If the company you own creates, distributes, markets and/or promotes products that are clearly offensive to biblical values, then you have the unfortunate privilege of participating in these activities through stock ownership in that company. Examples of such products or services that most Christians would agree on as sinful, immoral or offensive to God include:

  • Pornography and prostitution, or the use and abuse of individuals for sexual activities.
  • Abortion, which ends an infant’s life, including through the production and distribution of abortifacients. 
  • Addictive products or services that harm or even destroy the consumer; this could include alcohol, tobacco, drugs and gambling, as well as any other addictive products and services. 
  • Anti-Christian, anti-God, entertainment and publications that promote, desensitize and program our society to reject God and the Bible. 
  • Promotion of immoral lifestyles that reject the biblical principles of marriage and sexual relations.
  • Abusive labor practices or abusive environmental activities that are destructive to people, families and resources.

 When we own stock in a company that develops, distributes or promotes such products or services, we are passively participating in that Biblically offensive activity. As the Bible verse Ephesians 5:11 tells us: “Have nothing to do with the fruitless deeds of darkness, but rather expose them” (NKJV).

To illustrate this point more clearly, let’s pretend there was a company that made 100% returns each year for its stock owners. Most people would love to have an investment portfolio full of that type of stock. But when we look closer and find the profits come from child pornography and prostitution activities in some undeveloped country, we may feel different in participating in such gains.

Some stock owners may argue they personally did not exploit and destroy the children’s lives enslaved to prostitution and pornography. They just invested in a company. By buying the stock, however, they have financially shown support for the activities, endorsed with their money the services and have profited directly from the abuse of these children. A stock owner may be a passive participant but a participant just the same. 

I encourage Christians to be curious and find out what you may unknowingly be participating and supporting with your investment dollars. One way to do this is to visit the National Association of Christian Financial Consultants website at www.nacfc.org and use the free investment evaluator to see what's hiding in your portfolio.