Socially responsible investment practice means the adoption of a "double bottom line." The first is rate of return; the second is the accord between the values of the investing organization and the entities in which it invests. Religious organizations, organized as they are around values both explicit and implicit, are bound to seek correspondence between the values they profess and their investment policies and practices. For the Reform Jewish movement, devoted as it is to tikkun olam, socially responsible investment policies and practices are not an optional commitment; they are an organic expression of our core beliefs.
Broadly, socially responsible investment falls into three categories: First, the investor can assert "screens" that will rule out investment in entities that conflict with the investor's beliefs and values (e.g., tobacco companies, polluters); second, the investor, as a stockholder in a corporation, can seek to press that corporation to bring its policies into agreement with the investor's values; third, the investor can allocate some or all invested dollars to agencies that themselves have an active socially responsible agenda, ranging, for example, from low-income housing projects to community development banks.
Jewish legal tradition supports the position that Jews should not participate in projects that violate Jewish values, and we encourage all UAHC entities that engage in investment to develop appropriate policies that reflect that position. Here our concern is specifically with proactive investment, which is equally supported by our religious and historic tradition.
In recent years, exciting opportunities for what has come to be known as "community investing" have proliferated across the country. These investments provide urgently needed resources to benefit depressed communities and their people, communities that lack adequate access to the credit that is required if they are to be lifted out of their disabling poverty.
Indeed, lack of credit creates a cycle of disinvestment that perpetuates poverty. Community investment programs range from support for micro-enterprises to the development of affordable housing to the establishment of credit unions; there are by now thousands of such efforts.
The National Association of Community Development Loan Funds estimates that 20 percent of the capital of their member funds comes from religious sources. That is not an accident: Loans to those who work to build decent communities are an especially appealing and effective method for mending the world.
Even modest funds devoted to community investing can have significant impact, since they often help leverage substantial additional funds. Rates of return on such investments may vary, depending on market circumstances; in general, if they are carefully chosen, they need not deviate from conventional investments. And where, as here proposed, such funds are part of a balanced investment program and represent a small fraction of that portfolio, even a lower rate of return on funds invested in community development institutions will have a negligible impact on the total income earned from all investments.
The importance of investing in community development has been recognized by the Rabbinical Pension Board. The Rabbinical Pension Board was the first Jewish organization to join the Interfaith Center for Corporate Responsibility, and the Rabbinical Pension Board has made significant deposits in community banks. So too, the Central Conference of American Rabbis, at its 108th Annual Convention in June 1997, adopted a resolution on socially responsible investing that is, in its operative clauses, similar to this resolution. Were our entire movement to follow suit, and were our action to serve as a precedent for all Jewish communal agencies, federations, foundations, and institutions, vast new resources would be available for the urgent task of rebuilding North America's desolate communities. (A rough estimate of the funds that would be generated were the entire institutional Jewish community to adopt the program here proposed comes including one billion dollars. And were other faith communities to adopt a similar program, the result would change the face of America.)
Recognizing the immense potential of community development programs, as well as the fiduciary responsibilities of those who manage our endowment and pension funds, we hereby propose, in keeping with the religious imperatives of our tradition, that the UAHC take an active leadership role in promoting such investment.
THEREFORE, the Union of American Hebrew Congregations resolves to:
- Commend the Rabbinical Pension Board and the CCAR for their pioneering actions;
- Hereby establish the Chai Investment Program (CHIP), with the goal of investing 1.8% of the UAHC endowment investment pool in community development vehicles, with due regard for the fiduciary responsibilities that govern the investment of such funds;
- Urge the Rabbinical Pension Board, the American Conference of Cantors, the Hebrew Union College, our congregations, and all other elements of the Reform movement, to join in this program;
- Urge all elements of our movement to ensure that Jewish values and our commitment to social responsibility are reflected in their investment policies; and
- Undertake, upon the successful establishment of the CHIP initiative, to encourage other Jewish communal agencies, federations, foundations, and institutions to develop similar programs.