Why We Added a Second Bottom Line — Faith Driven Investor

by Bill and Dana Wichterman

Give someone a fish and they’ll eat for a day, but invest in a for-profit commercial fishery and their community could prosper and flourish for a lifetime. Well, that’s not exactly how the old proverb goes, but it’s no less true.

And that’s why we’re leaning into impact investing: it’s sustainable, dignifying, cures and prevents poverty, helps people flourish, heals broken cultures, and draws from a much larger pool of funding to have a bigger impact.

Philanthropy is important, and it’s often the only way to address a problem. When someone is hungry and in need of their next meal, giving them a fish is the best thing to do. But it usually doesn’t address the underlying cause of the hunger.

Plus, there is way more money available for impact investing than philanthropy. The average net worth of a family is around $100,000, whereas a tithing family will give just $10,000 annually. Harnessing the power of the liquid assets (in retirement and non-retirement vehicles) to intentionally invest according to biblical principles means the potential year-over-year impact of the investment dollars is far larger with a much longer tail.

Business is driven by two things: customers and shareholders. And in a sense, shareholders are more important because they also care about customers – without whom they won’t make money. Witness the power of shareholders shaping culture through ESG (Environmental, Social and Governance) investing, prompting businesses to behave far differently than if their sole concern were sales. With Christians managing more than $150 trillion, the power to shape culture is huge.

In the developing world, impact investing has far more potential to alleviate poverty and lead to human flourishing than charitable giving. Consider Sunshine Nuts in Mozambique. Founded by former Hershey Foods chocolate buyer Don Larson and his wife Terri, they are working to create a sustainable, for-profit cashew processing facility in one of the poorest countries in the world. They are providing good-paying jobs, training, and in a high-quality and safety-conscious factory shaping a culture of meritorious work for its employees and suppliers. The workers receive a small bonus every day they show up on time, upending the prevailing culture that undervalues timeliness. And Sunshine Nuts investors are betting on getting a decent return on their dollar so they can turn around and invest their appreciated capital in another start-up that has a redemptive mission.

The Sunshine Nuts employees probably don’t feel any gratitude to the company investors, because as far as they’re concerned, they’re trading their labor for their wages, giving them a sense of accomplishment and dignity that is absent when the poor are handed a fish. Work is a reward in itself since it’s one of the ways we reflect God’s image. Empowering the poor to earn their wages is ennobling in a way that charity just can’t be.

Impact investing can cure and prevent poverty in the first instance. Plus, wages create taxpayers, potential donors and investors. The unbending power of profits, deadlines, term sheets and spread sheets bring a real-world crucible to communities that government and philanthropic programs may lack. And it’s this market power that has the strength to straighten out twisted cultures (and all cultures need straightening to greater and lesser extents).

Impact investing is akin to the yet-to-be-invented perpetual motion machine that just keeps on going and going. But these machines need capital to be built in the first place. That’s where Christians come in.

We could seek a return-focused investment strategy without regard for the second bottom line, but why? If God wants to steward all our resources for His Kingdom, we shouldn’t ignore how we are making money. After having been challenged by Henry Kaestner and Greg Lernihan to use all of our resources in an intentional double-bottom line way, we’re systematically going through our portfolio, transitioning away from vehicles that have no regard for social and spiritual impact to those that do.

Admittedly, this requires effort – more effort than most busy people have time to expend. How can we vet all the companies in an index fund, much less a startup half-way around the world?

Thankfully, there is a movement in the Church to create organizations to do just that.

Praxis, Lion’s Den, Impact Foundation, Talanton, Eventide, Kingdom Advisors, and of course, Faith-Driven Investor are among the growing number of Christian-led organizations empowering Christians to unlock the potential of their capital to remake the world and lead to human flourishing. To us, it feels like a work of the Spirit blowing through the Church, and we couldn’t be more excited about it.

Abraham Kuyper, the Dutch Prime Minister 120 years ago, said, “There is not a square inch in the whole domain of our human existence over which Christ, who is Sovereign over all, does not cry: 'Mine!’” This includes our money – and not just our tithe, but our investments, too.