According
to rumors, Pope Francis could give a speech at Wall Street during his
next New York trip in September 2015. If these gossips are confirmed,
this intervention would be a meaningful symbol for religious and
financial communities from around the world. It would be almost two
years after the Pope's exhortation ”to
generous solidarity and to the return of economics and finance to an
ethical approach which favors human beings"1
and would provide an opportunity to promote "Catholic finance".
The
development of religious ethical finance has experienced a
significant acceleration in the last decade. However, in comparison
to Islamic finance, which has grown strongly and now represents over
EUR 2,000 billion of assets, Christian finances, in particular
Catholic finance, remain more or less embryonic. In France, although
the social finance market has seen a continuous growth for several
years, the sector of ethical finance is essentially atheist (not
religious).
The
lateness of the Catholic finance results, in a large part, from the
reluctance of religious institutions to endorse the concept of
"Catholic finance". The "Catholic finance"
expression remains a controversial question and sometimes taboo. The
main reason comes from the historical unease of the Roman Catholic
Church on issues related to money2
and communitarianism3.
However, due to the development of the Catholic financial activities,
the current situation calls for a clear position from the Holy See.
In
recent years, the French controversy over the concept of "Catholic
finance" has been crystallized in particular following the
release in July 2013 of the book "Catholic finance"
(“Finance Catholique”) which revealed a fault line between
supporters and opponents to the concept (I). However, in the
meantime, the Catholic finance has continued to develop its
activities. To best illustrate the dynamism of this market niche, we
will set out several recent developments (II).
I
/ The controversy relating to the terms "Catholic finance"
In
July 2013, was published a remarkable book by its title and purpose4.
It was the first of its kind to be entitled "Catholic finance"
and had the purpose of proving the existence of "Catholic
finance". The author, a lawyer, brought, in support of this
thesis, the names of several banks, investment funds, financial
products and para-financial services, which claim ostensibly to be
Catholic, or who proved, after analysis, to be compatible with the
values and precepts of the Catholic religion ("Catho-compatible
finance").
Following
this publication, several commentators pronounced themselves against
the validity of the thesis. Mr. Greiner, journalist at “La Croix”,
doubted it would be appropriate for the magisterium of the Church to
engage in a normative way for the allocation of a "label
of catholicity to financial actors"5.
The Community of St. Martin objected, for its part, that the concept
of "Catholic finance" for convenient it seems, is
nevertheless "inadequate to
describe what the Catholic Church intends to promote as type of
finance. Why? Because the criteria put forward by the Catholic Church
with regard to the financial world are not religious but ethical. The
Catholic Church, when it engages for a finance centered in human, do
it as expert in humanity, as Pope Paul VI said: the goal of the
Catholic Church is therefore not to establish a “Catholic finance”
but to promote everything that can contribute to reconcile financial
and human dignity, beyond sectarian differences."6
Finally, Mr. de Lauzun, who was awarded in January 2015 by the
Foundation “Centesimus Annus – Pro Pontifice” for the
International prize for economics and social studies, and the Justice
and Peace Commissions have never acknowledged the accuracy of the
terms "Catholic finance nor even used it.
In
the contrary, the controversial book sparked positive and
enthusiastic reactions. Since an "Islamic finance" is
officially recognized and supported by the French government, why
should we be reluctant to a "Catholic finance"? Some
regarded the thesis as "the first
step of awareness." Mr. Boudet,
professor in public law, conceded in a note of several pages to be
favorable to the concept of "Christian Finances" in plural,
and added that, despite many critics, the book was a "capital
work that goes beyond the traditional theological thinking by
defining what the catholic finance is throughout history, economics,
law and Catholic dogma." For his
part, Mr. Lieven, a journalist at La Croix, devoted the terms
"Catholic finance" half by using the expression with quotes
placed on "Catholic" only. But the most solemn contribution
came from the former president of the Vatican bank (IOR), Mr. von
Freyberg ventured to use the terms in one piece, on July 8th
2014, for the appointment of Mr. de Franssu to succeed him, declaring
"Through this work we have lad the
ground for a new team to make the IOR a truly outstanding service
provider in Catholic finance”.
Whatever
the outcome of this semantic controversy will be, several concrete
activities have meanwhile significantly emerged, in the Christian
finance area, and more particularly, in Catholic finance, that
certify without reservations their vitality throughout the world.
II
/ Illustration of Catholic finance's dynamism
As
regard to the first Catholic bank in the world, the Vatican bank
(IOR), it is clear that unprecedented reforms have been implemented
since summer 2013, through getting a website to publish its financial
results. And developments will not rest: in July 2014, the IOR
disclosed the second phase of reforms, some 19,000 bank accounts
having been cleaned. In the next three years, the organization of the
IOR should be modified and its activities should be redefined
following three priorities:
-
strengthening the business model;
-
transferring financial assets towards an asset management company
specially created for this purpose and called “Vatican Asset
Management”;
-
focusing the activities on financial advice and payment services for
the clergy, congregations, dioceses and lay employees of the Vatican.
In
addition, on May 2014, Father Pascal-André Dumont launched the
Luxembourgian fund “Conventum-Proclero” to reach European
investors by replicating the brother fund launched in France in July
2012 and managed by Meeschaert Asset Management7.
The
Oddo bank had, also created in 2012 a Catholic fund called "Oddo
Partage", where each holder undertakes to pay annually a portion
of its revenues, representing circa 1% of the net asset value of each
share, to a philanthropic foundation.
While
in the sector of crowd funding, the USA market had, since many years,
already several websites8,
started in France the first platform, named "CredoFunding"
just in November 2014. It aims to provide financial support
exclusively, to the projects of the Christian community compatible
with Christian faith and morality. CredoFunding intervenes for
donations but also loans with or without interest. The investments
may cover the following areas:
-
Education: Catholic school, catechesis, patronage, educational
organizations, universities, scouting movements, nurseries;
-
Religious living and Christian heritage: restoration of churches,
parish associations, building monasteries and abbeys, diocesan sites,
religious communities;
-
Solidarity and projects: humanitarian, human dignity, education
funding, social entrepreneurship, protection of life;
-
Culture and art: books and publishing, movies, music, handicrafts,
shows.
At
the same time, the association based in Paris “OFCCFO” set up a
label called "Excelsis" to award Christian compatible
investment products and services9.
Another
example could be Caritas France which published early 2015 its
findings on the provision of microcredits to persons in financial
distress. Since 2004, 2862 loans have been granted, 1879 of which
were repaid. The risk is carried half by Caritas France and a bank,
and is secured by a social fund guarantees. Until 2015, there have
been 293 calls for guarantee, which represents nearly 10% of the
number of loans. The majority of these loans were granted to women
(1573) for an averaged amount of 1,922 euros10.
Last
example but not least, in the Democratic Republic of Congo, the
project was disclosed in September 2014 by the National Episcopal
Conference of Congo to create a Christian banking institution,
through a partnership with the telephone company Vodacom11.
All
these illustrations are not exhaustive, but prove, once again, that a
number of new banking and financial activities get involved in
finance with a Catholic motivation or purpose. These activities are
dynamic and innovative. They must not evade the activities of the
Protestant Christian finance that are in many ways more numerous and
uninhibited regarding money. To conclude, it should be noted that, to
our knowledge, no Orthodox finance exists concretely so far. However,
according to the Russian press, a group of businessmen have started
to work in December 2014 as to the creation of an Orthodox bank and
investment fund and Archpriest Vsevolod Chaplin has welcomed the
project because it would rectify usurious mechanisms12.
Dr.
Antoine Cuny de la Verryère
President
of the association Christian Finance Observatory (OFCCFO)
__________________________________________________________________
1
« Evangelii gaudium, disclosed 24.11.2013 (§ 53-60 et 202-208).
2
Because one should “give back to Caesar what is Caesar's and to
God what is God's".
3 François-Xavier CARAYON, La finance orthodoxe :
réponse russe à la crise ?, 29/12/2014,
http://www.liberation.fr/monde/2014/12/29/la-finance-orthodoxe-reponse-russe-a-la-crise_1171434.
4
A. Cuny de la Verryère, Finance Catholique, EMS, 2013.
5
D. Greiner, Regards chrétiens sur la finance (2), in La doctrine
sociale sur le fil,
http://doctrine-sociale.blogs.la-croix.com/regards-chretiens-sur-la-finance-2/2013/09/16.
6 Communauté Saint Martin web-site :
http://www.communautesaintmartin.org.
7
http://proclero.com.
8
For example: Faith Funder, Faith Launcher, 1and700,
Christian-Crowdfunding, ou www.weraise.
9
http://christian-finance-observatory.blogspot.fr/p/contact_5.html.
10
http://www.secours-catholique.org/actualite/microcredit-l-action-du-secours-catholique-recompensee,13696.html.
11
La Banque catholique prend forme, 20/09/2014,
http://www.business-et-finances.com/la-banque-catholique-prend-forme.
12
The idea of orthodox finance, although spiritual, also pursues a
political ambition to build an independent Russian financial system
from the Western world (Archpriest Vsevolod Chaplin: Orthodox
banking rescue from crisis, 22/12/2014,
http://ru-facts.com/news/view/42460.html).
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