Faith-Driven Portfolios: Aligning Values with Investing
At Sound Stewardship, we’ve always believed investing is more than returns on a statement. It can also be an opportunity to align your resources with your values. That’s why we offer a variety of values-based portfolios designed to help clients harmonize their convictions with their capital.
Today we’re highlighting our Faith-Driven Portfolio Models. These portfolios are designed for the growing number of Christians who want their investments to reflect their beliefs. These portfolios support biblically informed stewardship within your investment strategy.
Our Faith-Driven Portfolios Combine Three Objectives With the Goal of Earning a Reasonable Rate of Return
- Avoid Harmful Business Practices
Values-based investing for Christians is more than just a financial strategy – it’s a conviction-driven approach to steward the resources entrusted to you. It acknowledges that when we invest our God-given resources into companies, we have a stewardship responsibility as partial owners in those companies.
Many industries have business models that inherently conflict with Christian teaching. For years, our Biblically-responsible model has excluded companies with inherently unbiblical activities. This means screening out companies whose core activities involve profiting from:
- Destructive addictive behaviors
- Exploitative or predatory practices
- Other business models fundamentally at odds with biblical principles
This ensures that your investments reflect your values and contribute to human flourishing.
For an example of screening methodologies, see Timothy Plan’s Foundational Principles.
- Embrace Positive Investment Themes
Our Faith-Driven Portfolios take this commitment a step further. Not only do they exclude morally objectionable industries, but they also embrace positive investment themes that resonate with the Christian faith. By investing in companies that promote human flourishing, you actively contribute to the creation of a more just and compassionate world.
Examples of positive themes include:
- Ethical Leadership: Integrity, humility, and stewardship in decision-making
- Human Dignity: Ensuring fair labor practices, valuing human life, and upholding human rights
- Social Responsibility: Engaging in philanthropic efforts, community development, and support for marginalized populations
- Environmental Stewardship: Caring for God’s creation through sustainable practices and eco-friendly innovations
Investing according to your values reinforces commitments such as integrity, compassion, stewardship, and justice.
For an example of positive themes, check out Eventide’s Investment Ideals.
- Engage to Advocate for Change
Investing is more than ownership, it’s influence. With our faith-driven portfolios, you also become a shareholder advocate, leveraging your influence to drive positive change. The funds we utilize actively engage with companies in your portfolio, encouraging them to uphold ethical practices and make meaningful contributions to society. We have intentionally selected managers who are engaged in the following ways:
- Shareholder proposals
- Proxy voting
- Direct dialogue with corporate leadership
While exclusion is appropriate when a company’s business model contradicts core biblical values, advocacy can be the most effective tool when the issue is a company’s behavior rather than its industry.
How do you respond when a company demonstrates a disregard for your values?
In some instances, excluding that business from your portfolio is the best answer – particularly if its business model is inherently antithetical to what you believe (see Avoid, above).
However, in many cases, it is not the core business practices in conflict with your convictions, but the way a company is behaving in the marketplace. By excluding this company, investors are effectively abandoning their influence on the items on which they disagree. They are giving up their voice!
Shareholder advocacy magnifies an investor’s voice by leveraging the power of larger groups. You gain influence unavailable to smaller investors when partnering in equity ownership with those who share your values. Through dialogue and participation in shareholder meetings, fund managers encourage positive change and hold companies accountable for their actions.
For an example of shareholder advocacy, check out the Praxis Advocacy Initiatives.
Who are Faith-Driven Portfolios for?
These portfolios are designed with Christian investors in mind, though many non‑Christians appreciate the thoughtful, principled approach as well.
Of course, values‑based investing isn’t one‑size‑fits‑all. Even within families, convictions can differ. Because portfolios invest across hundreds of companies globally, there’s no perfect alignment, but thoughtful screening and advocacy help move investments toward what matters most to you.
It’s also important to acknowledge trade‑offs. Faith‑driven funds often carry higher expenses because of the additional research, screening, and engagement required. Historically, these portfolios have performed comparably to secular counterparts, though future returns are never guaranteed.
If these portfolios aren’t right for you, your Wealth Advisor can explore alternatives, such as:
- Passive Index Funds: Our standard Index-Based Portfolios
- ESG Models: Values-based portfolios aligned to broad “environmental, social, governance” priorities
- Direct Indexing: A customized approach that can provide unique benefits for those with large taxable investment accounts.
Our Faith-Driven Portfolios are more than just financial tools – they’re a means to make a difference. Through thoughtful screening, positive impact themes, and shareholder engagement, these portfolios help connect your resources with what you believe matters most.
If this approach resonates with you, we’d love to explore how a Faith-Driven Portfolio could fit within your broader financial plan. Reach out to a Wealth Advisor to begin the conversation. Your faith, your values, and your investments can walk hand in hand.
Disclaimer: As with any discussion about investing, any particular strategy or investment may not be a fit for everyone. The information provided below is for informational purposes only and is not financial advice. Consult with your Wealth Advisor before making any investment decisions.
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