Investing and Finance
Exported from Holy-Writings.com on 2026-07-06 - 1 clipping

Dear Bahá'í Friends:

 Thank you for your inquiry, via e-mail, dated May 10 and concerning  several
issues raised in a May 9 Internet posting by Mr. xxxx.

 These are all very timely questions, as the growing maturity of the  friends
and their institutions, as well as the generally greater  amounts required to
attend to the needs of the Faith, lead us into  financial and spiritual
territory that has hitherto been largely  unexplored. Moreover, our emergence
from obscurity demands that the  investment decisions we make, whether
individually or collectively  through our institutions, reflect the principles
of the Faith and the  highest standards of integrity, quality and concern for
the well-being  of the fellow members of our human family.

 First, and with regard to your specific question, the basic principle  was
enunciated in a letter written on behalf of the beloved Guardian  and published
in Letters to Australia and New Zealand, p. 20: "The  only advice the Guardian
wishes to give is that whatever investment  the friends make they should do it
with the utmost caution, as  economic and financial conditions are at present
most unstable and  even precarious." The Universal House of Justice further
stated, in a  set of guidelines for National Spiritual Assemblies that was
shared  with local bodies by our National Assembly on February 24, 1992, that
"The National Spiritual Assembly itself must ensure that proper  provision is
made for preserving the value of financial reserves by  wise and careful
management."

 The National Spiritual Assembly has, in its own practice to date,  taken this
guidance to mean that investment instruments must reflect  the very best risk
available in the market; return is a less important  criterion. Further, with
the rapid proliferation of investment  vehicles, not all of whose effects are
known or predictable even to  highly accomplished financial professionals, an
extra measure of  caution is called for---the risks affect both the sacrificial
offerings of the believers, a sacred trust, and the future development  of the
Cause. 

 These criteria perforce narrow the range of acceptable investment  options for
Bahá'í institutions. Most government securities,  certificates of deposit from
commercial banks with the highest ratings  (at least AA-/Standard and Poore
rating and Aa3/Moody's Investors'  Service rating), and so-called "A1/P1"
commercial paper from leading  corporations whose businesses conform to our
standards as Bahá'ís  would likely be on that short list. Maturity limits, i.e.
the time  periods (tenors) for which funds can be invested, can be somewhat
flexible; the intent would be to match cash flow patterns and to avoid
speculation on market trends, a practice which could subject an  institution's
investments to additional risk. 

 In practice, the paucity of cash available to the National Spiritual
Assembly, owing to the relatively modest contribution income of the  last
several years, further limits the Assembly's options, whether in  terms of
investment tenor or of the vehicles used. The National  Spiritual Assembly does
have an investment policy which guides its  staff in the discharge of this
responsibility, and local Spiritual  Assemblies would be well-advised to create
their own policies that fit  their particular circumstances. 

 Naturally, individuals have greater latitude in choosing their  investments.
Mr. xxxx makes some cogent points about mutual funds;  these obstacles are
not, however, insurmountable in our view. Diligent  research can disclose the
various holdings of the mutual fund, at  least by industry sector, and where
that information is not available,  the believer always has alternative options
to a prospective  investment.

 Regarding a "Bahá'í money manager," there are already a number of  Bahá'í
professionals in the field of finance, of course, but we are  not aware of any
believer who is himself or herself the manager of a  fund, or of a fund
specifically directed to the use of Bahá'í  investors. The National Spiritual
Assembly has given some  consideration over the last several years to the
creation of different  kinds of investment options for the friends, but staff
has so far been  too overextended with existing priorities to give this subject
the  study and community dialogue it requires.

   Finally, the creation of a national foundation is an ambitious notion  which
certainly has merit. We question whether the institutional and  administrative
capacity is yet present to manage such an entity, and  in any event we fall
back to the previous point: there are not, as  yet, the human resources
identified or available to perform the  rigorous analysis prudence would demand
in this connection.

 One important aspect that would have to be meticulously considered for  these
purposes is the guidance, given by the Universal House of  Justice as recently
as 1989, that the creation of a financial  institution associated with the
administration was not deemed timely.  The Supreme Body did leave open the
option that individual believers  could establish some kind of private bank,
but stated "it should be  conceived entirely as a private, commercial
undertaking, and entered  into on sound business lines." (On behalf of the
Universal House of  Justice, 13 August 1989)

 The National Spiritual Assembly is committed, however, to establishing  a
viable planned, or deferred, giving program during the Four Year  Plan. This
can begin with every believer, who must, in accordance with  the provisions of
the Kit?b-i-Aqdas, make a will in order to testify  to her or his belief in God
and to dispose of personal belongings.  This act of obedience attracts
blessings in and of itself, while the  "execution of the provisions of the will
causes the spirit of the  deceased to rejoice in the Abh? Kingdom (on behalf of
Shoghi  Effendi)." More complex vehicles can and should be explored by the
friends, and this Office is presently developing a capacity to assist  the
believers in this process. Additional details will be communicated  as they
become available, including the interesting possibility of a  national
conference for professionals in this area.

 Finally, we must admit that we take some exception to the comment that  there
is a "great deal of spiritual ambivalence about money in the US  Bahá'í
community." There is always room for a deeper understanding of  every aspect of
the Faith, the role of material means included. The  community, however, was
set a demanding test in the year just past, a  test of obedience and firmness
in the Covenant whose outward  manifestation was financial: would we give our
share for the Arc? Tens  of thousands of believers, young and old, men and
women, rich and poor  alike, stepped forward, doing whatever they could out of
love for the  Cause, for Bahá'í'll?h, and for His Universal House of Justice.
The  result: more than $23 million was offered to the Arc and an additional
$13 million offered to the national and international funds. There may  be some
friends who do feel ambivalence; they would appear to be a  dwindling minority,
while another, more vital group is pressing  forward to seize victories for the
Cause. 

 The more important questions seem to us to be whether our offerings  will be
accepted by the Blessed Beauty, and whether the community will  maintain the
commitment to the Faith's future that we have so  strikingly demonstrated in
the last 12 months.

 We hope this information is useful to your consultation, just as the
questions have been helpful for us to consider here. Please convey  loving
greetings to the members of your esteemed Spiritual Assembly  and your
community.

 In His service, xxxx Finance Coordinator
-- Investing and Finance (Used by permission of the curator)