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The church in the crunch

Following huge losses during the financial crisis, the Church of England should return to the Christian principles of using material wealth for the common good

No-one is immune from the global economic crunch. That includes the Church of England, which has £5 billion tied up in assets, pensions and buildings. When the archbishops of Canterbury and York started to sermonise on short-term greed and the failures of market, they were embarrassed to discover that the Church had been playing the system in pretty much the same way as everyone else.

Initially, things looked good. Due to its share holdings, England’s Established Church gained hugely from rising oil, gold and copper prices, driven at least in part by speculators. In 2006-7 the Church Commissioners, accountable to parliament, set up a currency-hedging programme, in effect short-selling sterling to guard against rises in other currencies. The C of E invested £13 million in Man Group, the largest listed hedge fund manager. It also has a stock lending programme through JP Morgan Chase and has traded debts, in spite of the Archbishop of Canterbury's criticism of doing so exclusively for profit. The Church sold a £135 million mortgage portfolio last year.

Then things went pear-shaped. A week ago the Man Group was down 30 per cent in early trading after its profits slumped, potentially wiping £4 million off the value of the Church's holdings. The Commissioners have announced an average return on investments of almost 10 per cent a year over the last ten years. But most of these are in property and equities, which have taken a hammering as markets have fallen; so future prospects are not rosy. Exposure in banking (HSBC, TSB, RBS, and HSBOS, which has fallen a staggering 90 per cent) and mining (in defiance of ethical advice) is also costing the C of E dear.

It doesn’t have to be this way. The founder of Christianity once pointed out that “where your treasure is, there is your heart also”. Now is the right time for the Church of England to completely re-examine its asset and investment policies and to put its money where its message is. Given the performance of more ethical funds, that would also be a prudent move.

Many church groups are involved in alternative economic practices – co-ops, credit unions, ethical investment, fairer trade, local exchange schemes, micro credit, small loans for development, initiatives for monetary reform and more. Christianity, Judaism and Islam all have a history of critiquing usury, unjust profit from interest, and Jews and Muslims have set up non-interest based lending institutions.

Globally, churches have an opportunity to use their assets in new and creative ways, for economic change driven by human need rather than by greed. What is needed is the will. The earliest Christian communities were founded on principles of seeking to use material wealth for the common good, striving for equality and giving priority to the poorest. Today’s churches struggle to be so Christian, it seems. But as neo-liberal ideology quakes before stark reality, the wages of economic spin are proving deadly rather than ‘realistic’.


Simon Barrow is co-director of the religion and society think tank Ekklesia. He is author of ‘An economy worth believing in’.

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9 comments from readers

mat2clay@yahoo.co.uk
18 November 2008 at 11:19

As an atheist, I am used to , but abhor, the tendency of religions tu use mythology to manipulate millions of people worldwide for their own power-hungry ends. They also drain money from the gullible to pay for the trappings of that power - the palaces, the jewelry, the frocks etc. The big religions are fantastically wealthy and if they were genuine in their protestations about needing it to help the poor, they would use it to do so. They do not, preffering to play the fat cat games on the markets with their chums from the elite.. All of their 'gods' tell them to live poorly in order to allieviate the lot of the disadvantaged. If they believed in their gods, they would do so. Their behaviour demonstrates that this is far from the case. The bishops, immams, rabbis, popes, ayatollas and so on should be stripped of their obscene wealth so that it can be used to stimulate the economy in the way the politicians want, at a stroke negating the need for borrowing, higher taxes of reduced spending. A neat and fair solution to the problems of the recession that they were partially involved in creating.

entrails
18 November 2008 at 13:55

@mat2clay -- there may well be 'obscene wealth' lurking in some corners of the religious world, but I think you will find, if you take the trouble to look carefully, that the 'bishops' and co. of the Christian denominations of this country live, with few exceptions, very modestly---albeit that a few of them are still accommodated in the grand architecture of their predecessors.

That doesn't mean there isn't room for improvement in both attitude and practice, but your generalisation is far too sweeping, and seems to be made more for the purpose of reinforcing your own prejudice than out of any desire to engage with the reality.

The Christian church in this country once lived off the fat of the land granted to it by the lords and kings of the land. That legacy sustained it until relatively recently, but has now almost completely finished. Now it survives financially off the generosity of its members and the acumen and luck of its investment advisers (the subject of this article). Such 'wealth' as it has is almost entirely tied up in 'bricks and mortar', an historic inheritance that can be glorious, but also a terrible burden---most Christians have no particular interest in being museum curators or estate managers.

The buildings are not the 'church'. If they all fell down today the good news of love and hope in a broken world would remain, amd perhaps be more clearly lived.

amanfromMars
18 November 2008 at 14:10

Nowadays, communing with whatever Olde Worlde, conveniently established, locally pimped Tale, is clearly not nearly enough in a World of Beta Global Operating Devices spinning an Altogether More Enlightened Message to Follow.

How sad for the Church that they follow and fall foul to false profits but then they have no Viable Champion which must be an Abject Failing in the Hierarchy to Create One.

I suppose they will be expecting that to appear Miraculously all by itself ...as the Second Coming rather than a First Instance of something much more Profound and Universally Inclusive

FreedomLand
19 November 2008 at 02:49

Ahh, poor little ol' Anglican Church, uhh. This is nothing new - the Catholic Church has its own bank and its own insurance company as well.

Neither have appreciated the fact that God doesn't run a bank. What does this mean? The "greater glory of God" is NOT to be found in building cathedrals or any other kind of material monuments for the self-aggrandizement of the clergy and their preciously pretentious heirarchy.

What is worse is that all religious institutions ply their followers with the lie that they will somehow be there to help them after they have died and passed on. All they have to do is to leave everything - or as much as their families will begrudge - to the church in their wills.

All of this profit-making by the callous harvesting of bequeathed assets which are put to use for the benefit of the church and not the needy is based on FEAR and ignorance. Thus it has been in the interests of all priests/clergy to ensure that fear and ignorance continues to exist amongst their flock.

They prey upon the elderly and that is in NO way any kind of service to their God and is NOT the path that their teacher or founder instructed. In other words, they are not acting as Christians - and perhaps never really have!?!? That is, they are using peoples' fear of death to make their way in the world.

gnuneo
19 November 2008 at 04:15

well, i suppose i could just join in with the wave of bile aimed at the worst excesses of the 'Established Churches' - and the good thing is, the disgust their hypocrisy generates seems to never end, another indication that Mankind *does* have a balanced spiritual nature, eternal, and that these somewhat political institutions bear often little relationship to that.

but i shan't. :)

instead i just want to agree very much with this comment by Simon:

"Many church groups are involved in alternative economic practices – co-ops, credit unions, ethical investment, fairer trade, local exchange schemes, micro credit, small loans for development, initiatives for monetary reform and more. Christianity, Judaism and Islam all have a history of critiquing usury, unjust profit from interest, and Jews and Muslims have set up non-interest based lending institutions."

as it seems a lot more useful, and gets to the point of the matter. It also, by the by, illustrates that not ALL church groups are equally hypocritical, nor are they all as fanatically self-aggrandising as the Catholic Church of Imperial Rome.

it would be nice if the C of E spent a little more navel-gazing about the meaning of being a follower of Jesus, and slightly less having the 'poorer relation' syndrome to Rome. How ironic therefore that had they behaved more Christian, and less Mammon, they wouldn't now be facing the problems they are.

there is REALLY a lesson in there, if they look hard enough.

oh, and Simon - you will find that other religious groups do so too, the Abrahamic Religions have no monopoly on Quality behaviour.

Scurra
19 November 2008 at 14:32

Well, the Church of England is a pretty expensive operation to run (and it can barely cover itself as it is), so I'm not surprised that it's investment decisions have sometimes been more about the bottom line than about the moral and ethical aspects.

Having said that, it still has an impressively good record compared to most pension funds and multinationals, so I'm willing to cut it more slack - in a cold economic climate, it's the Church that still maintains a presence in the community, whilst banks and retailers are forced to put their shareholders first.

As it becomes increasingly apparent that the bankers and uber-capitalists really don't care about anyone other than themselves, this is indeed a rare opportunity for the Church to march under a different banner and start supporting these alternative types of projects more explicitly.

(gnuneo - I don't think Simon was claiming that that; I don't think he was even claiming that religious groups in general have such a monopoly. But this sort of "alternative" economic activity tends to thrive when you can operate in a long-term environment: something that modern politics and business is unable to do, ironically mostly thanks to democracy! Religions generally think that the short-term is a matter of decades, which does rather change perspectives...

gnuneo
20 November 2008 at 22:47

Scurra: "this sort of "alternative" economic activity tends to thrive when you can operate in a long-term environment: something that modern politics and business is unable to do, ironically mostly thanks to democracy!"

doesn't seem to have prevented the Scandinavian countries from investing in the long-term, Norway has particularly thrived so doing. I suspect because these countries have REAL democracy, after getting rid of much of their ruling classes privileges. The Citizens are seen as being *worth* high levels of investment in education, leading to the general population able to follow and vote upon long-term planning.

not perfectly, but noticeably moreso than the UK and US have. So i don't agree it is Democracy that has caused short-termism, in fact i would strongly argue rather the opposite.

somewhat agree with the rest of what you said though, its kind of pleasurable that the Church is somewhat being forced to follow actual Christian principles! LOL ;)

Aiya-Oba
22 November 2008 at 03:40

The fact that a lot of metals are not gold, does not mean no metal is gold. -Aiya-Oba.

Fred Preuss
11 February 2009 at 03:37

The Church of England is the Liberal Democrats at prayer. Middle class, middle aged, middle brow.

Disestablish it, get rid of clergy from Parliament and it might regain some credibility. But it's unlikely.

When you see bishops march against poverty and then sit down to a banquet, you've got to think that either these people are hypocrites or idiots. Either way, why anybody should listen to any of them is beyond me.

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