CoGS recommends responsible investing guidelines for church funds

A set of guidelines on divestment and other responsible investing practices has been recommended by Council of General Synod (CoGS) for use by Anglican and Anglican-affiliated organizations in Canada that hold managed funds.

The responsible investing task force, established in fall 2016 in response to a resolution passed by General Synod the previous summer, was mandated to look into responsible investing practices in funds held by General Synod as well as the General Synod Pension Plan, and to recommend changes if deemed appropriate.

Its report, presented to CoGS Friday, June 1, includes seven recommendations in a range of areas, including active ownership strategies (encouraging companies in which funds are invested to improve their environmental, social and governance (ESG) practices, for example); impact investing in companies that would further goals such as a low-carbon economy and the development of Indigenous business; and selecting fund managers with a view to ESG policies.

It recommends that divestment be considered if there are indications “that a company’s activities will not likely be modified to address material risks or salient ESG concerns.” It also recommends evaluating whether other companies in the same sector would meet higher ESG standards and to consider investing in them as opposed to necessarily divesting from an entire sector altogether.

The report recognizes that both the General Synod’s consolidated trust fund and the General Synod pension plan have, for years, already been taking ESG considerations into their investing decisions. It notes that the pension plan, which is administered by the Pension Office Corporation, an entity separate from General Synod—is not governed by the decisions of CoGS.

In response, CoGS approved a resolution endorsing the report’s recommendations and recommending that the investment committee and other bodies and staff of General Synod work together to put the recommendations in place. The motion “strongly” encourages the pension committee, as well as dioceses, ecclesiastical provinces and other Anglican-affiliated organizations, to seriously consider the recommendations.

The task force also presented to CoGS a draft of “Investing with a Mission,” a guide to responsible investing for Anglican and Anglican-affiliated organizations in Canada.

The task force is “very close” to a final version and hopes to have one ready to present to CoGS when it next meets in November, said task force member Robert Boeckner.

Bruce Myers, bishop of the diocese of Quebec, said he and his diocese were already looking forward to receiving the guide, which outlines four approaches to responsible investing, with recommendations on each, plus a theological reflection on investing.

Although the diocese has divested itself as much as possible from resource extraction, he said, it has also discovered that responsible investing is “sometimes easier said than done.” A theological rationale would also greatly help guide discussions of the diocese’s investment committee, he added.

In December 2015, the diocese of Quebec completed the sale of its assets in companies involved in mining and fossil fuels . Earlier that fall, synods of the dioceses of Ottawa and Montreal had voted to divest themselves of holdings in fossil fuel companies.

After the task force began its work, it realized it would be helpful to expand its scope beyond the funds controlled by General Synod and the pension fund, said Ryan Weston, General Synod’s animator of public witness for social and ecological justice and a member of the task force. It looked also at a range of other entities, including dioceses, parishes, theological institutions and foundations, surveying them about their investment policies and practices.

From its communication with these organizations, the task force learned there was widespread interest in a guide to responsible investing, and decided to develop one, Boeckner said.

The four approaches examined by the guide are the use of ESG considerations in choosing investments—using the services of an ESG rating provider, for example, to choose companies that score highly in these areas, rather than merely divesting; taking “active ownership” by using one’s position as a shareholder to influence company practices; practicing “impact investing”—investing in social enterprises, for example; and “investment exclusion,” or divestment.

Divestment is often the first thing that occurs to people when they think about responsible investing, but it’s important not to see it as the only option, Boeckner said, and it can also involve significant complexity and the possibility of trying to balance conflicting goals. The two largest companies active in Canada’s oil sands, for example, are also the largest private-sector employers of Indigenous people in Canada, he said.

“They’re teaching many Indigenous people good technical skills that will be transferable when the oil sands run out or is shut down,” he said.

“You have to be careful, if you divest too much, that you end up burying your talents in the ground,” he said later, referring to the parable of the talents in Matthew 25:14–30, in which a master, having given coins to three of his servants, praises the two who use the money to profit from it (“Well done, good and faithful servant”), but scolds a third who buries his portion.