ROME— When Cardinal Jorge Mario Bergoglio of Argentina was elected to the papacy in 2013, Brazilian Cardinal Claudio Hummes, who was sitting next to him in the Sistine Chapel as the conclave unfolded, told him, “Don’t forget about the poor.”
Arguably, it was that comment that led the newly chosen pope to choose the name Francis, and since then, the first pope from the Global South has made “a poor Church for the poor” a key element of his ministry.
That could be understood in terms of class struggle, as a sort of “rich v. poor” standoff with the pope clearly on one side.
But what if the rich of the world actually worked with the poor, not only with philanthropy but through what’s known as “impact investment” – using the power of investment dollars to shift power to local communities, so they can be the lead actors in eradicating poverty?
This was the question that a June 26-28 Vatican conference called “Making the Year of Mercy a Year of Impact for the Poor” tried to answer, bringing together key business experts, policy makers and Catholic leaders from around the world to explore the power of impact capital to support the Church’s social mission.
Hosted by the Pontifical Council for Justice and Peace and United States’ Catholic Relief Service (CRS), the conference took place in Rome’s Crowne Plaza Hotel, and was attended by over 170 people from every continent, including a handful of Muslim, Jewish and Buddhist participants.
Impact investment is a financial tool that uses private, profit-seeking capital to tackle challenges of global sustainability. It’s been a growing trend in recent years, drawing resources and funding from some of the world’s largest banks and foundations.
According to the 2016 Global Impact Investing Network, the total amount of impact investment assets is estimated at $77.4 billion, with $15 billion being invested in 2015 alone.
Carolyn Woo, President of CRS, hence one of the organizers of the conference, said that to her, it’s a complete “no brainer” that the Catholic Church has to engage capital management. “Business is not evil by itself… evil people do evil things.”
The last three popes, she said, have made clear that it’s not capitalism, market or business which are the problem, but the business ethics and values they reflect.
“Business comes with a lot of power, it can lend itself to exploitation, but it’s a necessary good,” she said. “How can we use power and money to serve the poor?”
“It was a no-brainer that the Church I love needs to have access to this type of skill to be able to find solutions to the challenges the poor face,” Woo said on Tuesday.
Woo, former dean of the business school at the University of Notre Dame, told Crux that getting together the leaders of the Catholic Church ministry, “the backbone of health care, educational and social services in big parts of the developing countries,” as well as investors who want to put money into these ministries while wanting them to be sustainable, is “key to addressing poverty.”
“With the scale and intensity of problems that we’re facing, it wouldn’t be enough to sustain them with philanthropy,” she said. In addition, she said, “these problems are so big that if you can’t connect the private, government and civil sectors, we will always be working with one hand tied.”
Just to give a still of the scope of the problem, Woo lists the world’s 65 million refugees, for some of whom it’ll take up to 17 years to return home; the degree of violence, some if it triggered by extreme poverty and inequality; the absence of jobs; and climate change, which brings about devastation.
“If we work alone in the way we used to work, we won’t be able to address these issues on the scale, the frequency and the intensity with which they are presented to us,” she said.
According to Woo, the Church has had its social mission for the last 2,000 years, with a huge missionary zeal in the last 150 years, but it always lacks capital. Seeing that funds are now available, as a direct result of a change in mentality from many in the private sector, she believes it’s time to step up and say, “are there some of our ministries that can be sustained by a larger pool of capital?”
Some of the money coming from capital investing funds, she said, is actually Catholic money – from dioceses to religious orders to health care associations. Yet it’s not being invested in Catholic ministries, she said, “because they haven’t organized themselves to be able to use investment capital.”
“Save for some exceptions, they are completely dependent on philanthropy,” she said.
She adds that her argument to have Catholic funds investing in Catholic projects isn’t because she’s “tribal” but because Catholic ministries have a long history of performance, the social heart, the spiritual values and the operational experience.
“But they lack the capacity to think about revenue cost scale model,” Woo said.
One of the many focuses of the conference was the importance of empowering women as a way to guarantee long term changes. Woo, who’s on record saying that women in leadership positions shouldn’t be an exception for the Catholic Church, said that cultivating the capacity of women, helping them to become healthier, gain education and become more productive is the solution to many of the world’s problems.
“The issue of peace [would be resolved], because women don’t choose to go to war,” she argued. “The issue of human trafficking, because women will no longer feel tempted to say yes to a stranger who offers them a job in another continent, and so on.”
Among those in attendance was Cardinal Theodore McCarrick, former Archbishop of Washington. For the prelate, the June 26-28 Vatican gathering was a necessary follow-up to a similar conference which took place in 2014, also in Rome.
According to McCarrick, “the Holy Father has concentrated so much on the poor,” urging the world “not to forget” about them, that this conference is “right up his alley: This is people who are listening to what he’s saying, and being called to respond.”
Investors from the private sector participating in the conference, such as the Wallace Global Fund, Morgan Stanley, Ascension Investment Management and the Ford Foundation, aren’t only “being challenged by Francis, but trying to see how they can foster development.”
Cardinal Peter Turkson of Ghana, head of the Pontifical Council for Justice and Peace, built on this idea, saying that the conference presented two major challenges: For Church institutions, to be imaginative in the way they address financial problems; for investors and businessmen, to bring the Gospel into what they do.
Although it wasn’t as present as he would have liked, despite the daily Mass, and the opening and closing prayers for each day’s sessions, Turkson told Crux that the conference and the Church implementing impact investing “is a way of evangelizing businesses.”
“The Church doesn’t point an accusing finger at businesses, but we have to always preach God,” Turkson said. “How can we help them discover fraternity, brotherhood, and Christ’s message of dying for your friends?”
In fact, as Turkson said in his opening remarks on Sunday, business is “very much part of the human vocation” because “God created wood, but he didn’t create furniture.”
“The charity of God with the human person requires that men and women become entrepreneurs, to meet the needs of humanity,” he said.