We believe that it is extremely important that our financial investments are consistent with FCNL’s vision of a world free of war and the threat of war, a society with equity and justice for all, a community where every person’s potential may be fulfilled, and an earth restored.
The Friends Committee on National Legislation and FCNL Education Fund (hereafter FCNL) are committed to using a socially responsible investment policy as a means of furthering our goals. We believe that it is extremely important that our financial investments are consistent with FCNL’s vision of a world free of war and the threat of war, a society with equity and justice for all, a community where every person’s potential may be fulfilled, and an earth restored.
This policy commitment extends beyond mere avoidance of companies whose policies we find objectionable; we look for those companies that have a superior record within their industry in meeting their obligations to society. We also try to find those companies whose economic behavior reflects some elements of our vision of a better world. However, we acknowledge that companies as well as individuals are not perfect and that we should recognize both the good and bad aspects of their operations in making our investment decisions.
Our socially responsible investment policy is especially important in the current culture which encourages both investors and corporation management to focus on the today’s bottom line rather than on the long-term implications of company policies. Of even more importance is the belief that the investment of FCNL’s financial assets should be in harmony with and support our overall efforts toward peace and social justice.
With results to support us, we do not believe that this investment philosophy will negatively affect our investment performance. Indeed, we believe that, over the long term, ethical companies make better investments. We should add that efforts to influence the behavior of companies is not a primary goal of our investment practices but may occur in the process of making inquiries regarding social responsibility.
Social Responsibility Considerations
A. FCNL seeks to invest in companies providing goods and services to meet human needs. These include: food, medicine, clothing, housing, heat and light, transportation, communication, recreation, renewable energy, and “green” products and services.
B. FCNL seeks to invest in companies committed to a peaceful world. It is FCNL’s policy to avoid investing in any company which develops, manufactures, or profits from weapons, including conventional, chemical, biological, and nuclear weapons. FCNL further seeks to avoid investing in anti-personnel weapons, small arms, weaponized drones, and goods for the automated battlefield. FCNL avoids investing in companies exporting arms and those who profit from gun violence. FCNL will focus on avoiding investments in companies with military contracts exceeding 2% of their gross revenues.
C. FCNL seeks investments that promote sustainable economies and responsible environmental stewardship. FCNL seeks to avoid investments in companies with substantial involvement in extracting, refining, or distributing fossil fuels.
D. FCNL seeks to avoid investing in companies primarily involved in producing or distributing alcohol or tobacco, or with gambling or adult entertainment. FCNL seeks to avoid companies that profit from conspicuous consumption, land speculation, predatory financial practices, or privatized detention facilities.
E. FCNL seeks investments that promote social change, favoring more democratic, equitable, free, and sustainable societies.
F. FCNL seeks to invest in corporations whose business practices recognize the rights and cultures of indigenous peoples. We seek to invest in companies that have adopted codes of conduct to guide their policies, programs and operations. FCNL further seeks to avoid investment in companies that contribute to an occupying military power transferring parts of its population into the territory it occupies, in violation of international law.
G. FCNL may invest in US Government agencies, but seeks to avoid holding US Treasury bonds, which may support military spending.
H. In determining appropriate investments the following criteria regarding corporate behavior are important to FCNL:
Personnel policies, including civil rights and affirmative action records, as well as adherence to internationally recognized labor standards.
Employee welfare and safety
Corporate governance and transparency of disclosures to shareholders
Board diversity and management diversity
Whether the corporation pays a living to its employees, and what the ratio of CEO earnings to average employee earnings is.
Community involvement and sustainable employment practices
Most companies have uneven performance records against any social responsibility criteria. They can be good in some areas and not acceptable in others. This is compounded by the complexity of many of the larger companies which have multiple lines of business and which operate in many different locations and settings around the world. With limited resources it is difficult to acquire all the necessary detailed information to apply these guidelines. For all of these reasons, it is unlikely that FCNL social responsibility goals in investments will ever be totally accomplished. However, we are committed to continued progress toward these goals.
The FCNL Finance Committee, in addition to its ongoing discussions of social responsibility as individual investment choices are made, annually reviews the list of FCNL investments and investment guidelines at its first meeting of the calendar year. The FCNL Executive Committee and the FCNL Education Fund Board review, and revise as needed, these guidelines in the year following the revision of the FCNL Statement of Legislative Policy by the FCNL General Committee.