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A Corp meets on Zoom on February 14. Photo by Leslie Scanlon.
The board of the Presbyterian Church (U.S.A.), A Corporation spent part of its Zoom meeting Feb. 14 considering link between equity issues and the denomination’s finances and investment.
That issue came up on several ways.
First, the board approved a new provision to its gift acceptance policy that will allow it to refuse gifts with restrictions “that conflict with General Assembly mission, values, policies or stances.”
That measure was proposed after an in-depth review of restricted funds in 2021 found a half dozen that with problematic restrictions – including some long-ago contributions with restrictions that are racist, said Kathy Lueckert, president of the A Corporation.
“These kinds of things don’t come about very often,” but the revised policy gives the denomination a way of dealing with it if new gits are offered with problematic restrictions, Lueckert said.
Sam Bonner. Photo by Leslie Scanlon.
Board member Sam Bonner asked what the status is of the gifts with the racist restrictions — basically, what’s happening with that money? To keep those funds “is an insult,” Bonner said.
Kathy Lueckert. Photo by Leslie Scanlon.
Lueckert responded that the Presbyterian Mission Agency has been “creatively subversive” in finding ways to use some of those funds while adhering to the restrictions — some of the most racist funds are being used for diversity, equity and inclusion training. But the income generated by other funds is simply not being spent because of the restrictions, she said.
Board member Chris Mason suggested filing cy pres actions in secular court seeking to remove the racist restriction. If that can’t happen, “then the money goes to the state, because we don’t want it.”
Second, the board adopted a new anti-racism statement, developed by the Diverse Voices Table in response to a referral from the 2020 General Assembly. That statement (See Anti-Racism Statement), which PC(USA) agencies and entities are being asked to adopt, states in part that the PC(USA) is 88% White and “we are undeniably implicated in the entrenched legacies of racism and white supremacy that continue to shape the United States and our church.”
Third, the board discussed the beginnings of an idea – Lueckert called it a “conceptual presentation” – that it consider shifting the A Corporation’s investments to better represent a commitment to diversity, equity and inclusion.
Lueckert said the work began when a colleague asked her: “Why isn’t the A Corporation investing in Black and Brown institutions?”
Good question, she thought.
So Lueckert began to investigate ways the A Corporation might reallocate some of its investments “to spread the wealth around.”
Cynthia Campbell. Photo by Leslie Scanlon.
The A Corporation holds about $50 million in short-term, liquid funds at PNC Bank to cover its cash flow needs, she said. Those funds “do not lend themselves to investment segmentation,” a report to the board states.
A better possibility might be with about $54 million in short-term investments the A Corporation holds with the Presbyterian Foundation. One idea; invest a tithe of those equity holdings (about $2.5 million) in two ways. Half would be invested in the new Diversity, Equity and Inclusion Fund at New Covenant Trust — a fund that meets the socially-responsible investment guidelines established by the General Assembly and the PC(USA) Committee on Mission Responsibility Through Investment.
The second half of the tithe would be invested in Northern Trust’s 360 Global Equity Fund, a portfolio of investment funds managed by Black investment managers. The problem: about 5% of that fund does not meet the PC(USA) socially responsible investment requirements.
“Is it worth considering to not completely adhere” those criteria if the goal is to invest in a minority-owned investment group? Lueckert asked. “I don’t know the answer to that, but I think it’s worth wrestling with.”
Board members seemed interested. “I’m really intrigued by the proposal,” said Cynthia Campbell. “I think it’s good to start small,” and to get more information about the diversity, equity and inclusion track record of those funds.
Also, “due diligence and performance would be key elements to look at,” Bonner said.
Some board members suggested investigating to find out whether a bank could be used for the short-term investments that also would provide greater diversity, equity and inclusion options.
Carol Winkler. Photo by Leslie Scanlon.
“I like the idea of investing in people,” said board member Carol Winkler, speaking of the possibility of investing in funds managed by people of color.
“There is no time pressure to take action,” the report states. “However, shifting some assets to DEI funds would clearly indicate A Corp’s commitment to diversity, equity, and inclusion in those areas in which A Corporation has influence.”
Another item that surfaced at this meeting: A timetable for developing a roadmap for how the A Corporation can invest in future technology needs, after what a report describes as a “decade of disinvestment.” That project will cost under $100,000 and is expected to be completed by June.
Outlook Reporting
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