Pope Francis’ encyclicalsFratelli tutti and Laudato si’ can serve as a framework for establishing ethical standards in finance. “Values’ Metrics” – an investment analysis tool inspired by Pope Francis’ texts on environmental, social and governance issues – was presented at the Vatican on April 7, 2022 by Cardinal Peter Turkson, recently appointed chancellor of the Pontifical Academies of Sciences and Social Sciences by the pontiff.
The former prefect of the Dicastery for the Service of Integral Human Development made a point of presenting this project, which he accompanied during his mandate, which ended last December. In front of some 60 representatives of the financial world, he explained that he believes it is necessary to “help investors by offering them advice consistent with the faith and social doctrine of the Church.”
“There is a great need to determine, formulate, discover, discern the values” that must be taken into account in the world of financial investments, insisted the Ghanaian during the presentation in which I.MEDIA participated. For the Church’s social doctrine, he stressed, the central value is “the dignity of the person” which “has its origin in the fact that every human person is created in the image and likeness of God. From this stems the sense of dignity of every person.”
The objective of financial investment instruments, he concluded, must be to “promote the dignity of each person, of all persons, that is, the common good.”
To this end, Values’ Metrics relies on both ESG criteria (for “Environment, Social, Governance”) which measure the environmental, social and governance impact of companies and on SRI criteria (for “Sustainable and Responsible Investment”). In recent years, these investment evaluation tools have become widely used in the financial landscape as ethical analysis tools, notably at the initiative of the “Economy of the Common Good” movement, championed by Nobel Prize winner Jean Tirole.
The concept of Value s’ Metrics was born from the initiative, among others, of Maurizio Grifoni, president of Fon.Te., a pension fund for employees of companies in the service sector in Italy, who came to present this instrument at the Vatican. According to him, with the environmental problems, the pandemic and now the fear of war in Ukraine, the world of finance understands more and more that “it must rediscover its regenerative capacity and no longer speculative.
The mission of finance, he insisted during the presentation, is “to contribute to creating an economy of the common good.” However, he recognizes that the ESG criteria that exist today are often different and sometimes even contradictory, which creates a lot of confusion. In particular, he mentioned the case of “greenwashing”, a misleading communication strategy aimed at giving itself an image of ecological responsibility.
“A new economy”
For Maurizio Grifoni, Values’ Metrics offers international finance and its investors evaluation criteria “to create a new economy.” “Investments,” he emphasizes, “must take into account not only the benefits, but also the social and environmental impact, in order to promote a truly sustainable development model, in line with the principles that preserve the common good towards an integral ecology.”
During the presentation, Paolo Bersani, partner of PWC Italia, explained that today it is “necessary to give concrete references to companies and entrepreneurs to understand how to do business while protecting the common good, inspired by the Pope’s encyclicals.”
The pontiff’s words, said Carlo d’Asaro Biondo, CEO of Noovle, “lead us to reflect on the need to live in a more sustainable world.” For the former president of Google EMEA for partnerships and strategic relationships, in this perspective, investors must strive “to respect certain rules of life, including the importance of safeguarding the environment, with the aim of ensuring a better future for future generations.”