Sister Leticia De Jesus Rodriguez, the appointed treasurer of the Sisters of Charity of the Incarnate Word, has led the congregation's transition towards impact investing as the head of a special committee since 2017. To embrace the mission-aligned financial journey, they counted on the assistance of Jessica Cook, a long-term board member of CIIC and the Managing Director of Business Development at an investment management firm.

A strong call answered by prophetic women

Communities of faith continuously review their independent financial policies, following the instructions offered by the United States Conference of Catholic Bishops (USCCB) and the Resource Center for Religious Institutes (RCRI). The USCCB recommends that religious congregations avoid funding categories of ventures deemed "immoral business activities" under the Catholic moral teaching by forwarding socially responsible investment guidelines. The guidelines also acknowledge investment strategies promoting community development ("Common Good") at potential lower returns when "they give expression to the Church's preferential option for the poor or produce some truly significant social good."

Inspired by these guidelines – even if not confined by them – religious communities assemble their independent strategies on corporate responsibility to be ethical and responsible, accounting for the confluence of their religious mandate and fiscal responsibilities. Congregations worldwide have taken steps beyond the Environmental, Social, and Governance (ESG) minimum standards, answering the Encyclical Letter Laudato Si's strong call on care for our common home.

The evolving Catholic investment approach has sent a clear message across faith based communities: it is time to further the commitment to a positive social and environmental impact on their regular missions and the institution's financial strategy.

The Sisters of Charity of the Incarnate Word (Congregatio Charitatis a Verbo Incarnato - CCVI) have answered this powerful call, embracing the United Nations 2030 Agenda for Sustainable Development, divesting from fossil fuels, and applying an intentional investment strategy focused on social and environmental impact. Historically, their pastoral and social ministries have devoted their activities to promoting health, education and social justice in the United States, Latin America (Mexico, Chile, Colombia, Peru), Ireland, Tanzania, and Zambia.

The CCVI members are elderly, median 80 years old. According to Sr. Leti, “As we depend on our reserves applied to investments, we started asking how we could be prophetic during our retirement age in a different way, along with our missionary work.” The sisters heard about impact investing through other congregations and felt what Sr. Leti described as “a very strong call to be one-hundred percent impact investing.”

In 2018, a report from CCVI leadership encouraged alignment with the USCCB’s Socially Responsible Investment guidelines. The sisters expressed that it was not enough, suggesting they could go beyond the standard directives. Therefore, they started researching further options towards impact investments and, a few years later, established a task force, focused on evaluating the steps needed towards more impactful social investments.

The committee

As CCVI's reserves and operations are highly dependent on their investments' welfare, a task force of five women was formed to explore the meaning of impact investing upon a common ground, raising their understanding on the matter, dismantling misconceptions about the process, and gathering information about other congregations' similar efforts. The committee's meetings had an intentional exploratory and collaborative nature, allowing a free flow of ideas among the participants to identify the best practices and strategies.

One of the committee members, Jessica Cook, has been a knowledgeable resource devoted to Catholic impact investing advocacy. She serves on the advisory board of CIIC and works in the investment management industry, focusing on socially responsible investments with "a foundation of faith." Jessica Cook built a bridge between the CCVI and CIIC, connecting Sr. Leti to the faith communities in CIIC's ecosystem.

In conversation, Sr. Leti and Jessica mutually expressed the value of this collaboration on the journey of impact investing:

Sister Leti: – When we started asking our financial consultants about impact investments, they also needed a clearer idea of what we were talking about. One consultant answered that we were already following Catholic directions. The leadership established that moving towards impacting investing would require planning to achieve measurable financial outcomes. Jessica, through her contact with CIIC and impacting investing advocacy, brought a clear vision of what that meant.

Jessica Cook: – My first committee meeting happened in San Antonio in February 2020. I vividly recall that there was so much energy from Sr. Leti and other members talking about impact. There were a lot of voices on the table and many different interpretations of what impact meant, whether there were financial returns or if they were charitable giving. Those meetings progressed, and I wanted to connect them with a larger group of true believers in the impact community, where Sr. Leti could engage with a larger Catholic group that started their journey exactly where she did. At CIIC, she could entertain conversations about how they overcame the hurdles of including impact investing in their portfolios, how to identify the options available in the market, and how they went through governance issues.

Sister Leti -- We collected critical information, understanding that many opportunities can bring good financial returns while intentionally creating a positive influence.

The connections made through CIIC were fundamental to defining what they wanted to accomplish and navigating common challenges. This networking process and the committee's work inspired the sisters to develop the November 2021 Directive, pursuing investments with an environmental focus and relevant private equity returns in addition to their philanthropy work with refugees.

CCVI's impact investing goals and lessons

In 2021, the Sisters of Charity of the Incarnate Word started their impact investing movement with an initial $250,000 allocation. Their target is to identify opportunities with 6.5% returns on the long-term horizon to align their social commitment with the continuous support of CCVI members and missionary undertakings. To date, they have made two impact investments with that allocation - both opportunities were shared by other members of the CIIC community.

Sr. Leti expressed the expectation of gradually increasing that initial target and expanding their efforts towards investment-driven social impact. The hope is also to influence other congregations and affiliated institutions to align their mission and investment policy statement (IPS) by joining this emergent pathway.

The main lesson Sr. Leti and Jessica shared from this financial journey was overcoming the misconceptions around impact investing, including the scarcity of service providers. There is a growing community of financial advisors and social impact advocates capable of guiding those interested in pivoting their investment strategy. The prospect is an increasing supply of impact-focused fund managers and consultants as the world calls for a better relationship between money, the people and the planet away from the profit-at-all-costs framework.

According to Jessica, impact investing is a still-evolving policy that is set to grow over the next generations through more engagement and information flow. This change is a matter of finding the right people to work with and identifying the options already available in the market.