The Institute for Works of Religion (IOR), or Vatican bank, launched two ethical investment indices in collaboration with Morningstar. The new benchmarks, the Morningstar IOR Eurozone Catholic Principles and the Morningstar IOR US Catholic Principles, are intended as references for Catholic investments globally. These indices are constructed using market best practices and adhere to Catholic ethical criteria, aligning with the IOR's Investment Policy. Each index comprises 50 medium and large-capitalized companies deemed fully compliant with the IOR's ethical investment standards. This development is part of ongoing reforms initiated by Pope Francis to enhance ethical investing and transparency within Vatican finances.
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The Institute for Works of Religion (IOR), known as the Vatican Bank, launched two equity indices on February 11, 2026: the Morningstar IOR Eurozone Catholic Principles and the Morningstar IOR US Catholic Principles.1 2
Developed with Morningstar, these benchmarks aim to guide Catholic investors worldwide by tracking ethical investments aligned with Church social doctrine.1 5 6
Each index includes 50 mid- and large-cap companies fully compliant with IOR's investment policy.1 2
Examples cited include Amazon, Meta, Tesla, Apple, JPMorgan, Deutsche Telekom, Banco Santander, UniCredit, and Allianz.5
They follow market best practices while incorporating Catholic ethical criteria, with quarterly reviews and immediate updates for significant events.1 5
Companies are screened using over 20 themes and 200 data points, excluding those involved in abortion, contraception, stem cells, controversial weapons, fossil fuels, gambling, and more.1 5
The indices promote investments supporting life, social responsibility, and environmental protection, building on the 2022 Vatican document Mensuram Bonam.2
In 2024, IOR reported a net profit of 32.8 million euros, up 7% from 2023, with assets under management at 5.7 billion euros.1 2
Its Tier 1 capital ratio reached 69.4%, among the world's highest, enabling a 13.8 million euro dividend for charities.1
The launch continues Pope Francis-era reforms addressing scandals like Banco Ambrosiano and unethical investments, including a 2021 divestment from a contraceptive producer.1
Pope Leo XIV repealed a 2022 order centralizing investments under IOR, amid tensions with bodies like APSA and the Committee for Investments.1
IOR's Giovanni Boscia emphasized rigorous, transparent processes compliant with Church principles.2 6
Morningstar's Robert Edwards highlighted demand for values-based benchmarks with objective application.2 5
These indices position IOR as a global reference for Catholic ethical finance, potentially influencing dioceses, orders, and lay investors.1 6
They integrate faith with professional standards, advancing Vatican transparency post-scandals.1 6
Assess Catholic ethical investment criteria in contemporary financial markets
Catholic ethical investment criteria offer a robust framework for aligning financial stewardship with the Gospel and Catholic Social Teaching (CST), emphasizing the common good, human dignity, and integral human development in today's volatile markets. Drawing from "Mensuram Bonam" by the Pontifical Academy of Social Sciences, these criteria urge investors—individuals and institutions alike—to integrate faith-based screens that exclude moral harms while promoting positive impacts, all while fulfilling fiduciary duties and potentially enhancing long-term returns. This assessment reveals their timeliness amid global crises like pandemics and inequality, where finance must serve people rather than dominate them.
At its heart, Catholic ethical investment reorients wealth management as a vocation rooted in discipleship. Local Episcopal Conferences have long applied CST to real-world economics: the Austrian Bishops highlight wealth's societal influence, obliging responsible use; the US Bishops frame economic life as a sphere for faith, neighborly love, and holiness; and the Italian Bishops insist ethics is intrinsic to finance, arising from its human nature. Pope Benedict XVI reinforces this, noting business's human significance demands moral consistency alongside competence.
"Mensuram Bonam" (MB) extends Vatican II's mandate for dialogue with humanity, shedding Gospel light on asset management. It calls for stewardship that respects justice, ethical standards, and the common good, viewing investing as part of integral human development. Pope Francis echoes this urgency, decrying how financial markets shape destinies unjustly and speculating on essentials like food, which burdens the poor. Ethics must reclaim finance to serve peoples' needs, fostering a "virtuous circle" between profit and solidarity. Thus, principles prioritize dignity, solidarity, and care for creation over mere profit maximization.
MB provides actionable guidance, blending exclusionary and enhancement approaches. Exclusionary screening avoids contradictions with Church teaching by barring investments in grave evils like abortion, pornography, child labor, or slavery—24 categories warranting discernment, often informed by bishops' conferences. This uses a CST "lens" for prayerful evaluation across ESG axes (ecological, social, governance).
Proactive enhancement and best-in-class strategies go further, selecting top performers within sectors via "integral ecology" metrics echoing the Beatitudes: justice, peace, mercy, and inclusion of the marginalized. Impact investing channels funds to agriculture, water, housing, health, and education for the poor, yielding reasonable returns while creating jobs and productivity. Investors refine themes through CST, demanding transparent metrics.
Practical habits include:
Small or large investors adapt these as a "trajectory," building on Vatican models like the IOR and Secretariat of the Economy.
Skepticism that ethics compromises returns is refuted: rigorous faith criteria yield "equal or better ultimate performance" long-term, via a "Sustainability Premium." Post-2020 crisis, sustainable indices outperformed; trusted ethical firms weathered downturns better. Ignoring ESG risks fiduciary failure, as ethical innovations boost risk-adjusted returns. Monitoring ensures alignment with faith values, security, and sustainability. MB assures this fulfills, not undermines, duties to stakeholders.
Today's markets, accelerated by technology, demand ethical recalibration amid inequality and exclusionary economies. MB addresses governance renewal, strategy reimagination, and multi-dimensional evaluation. Challenges include expertise needs and varying regional practices, met by learning from innovators and interfaith collaboration. It counters "Covid-19 uncovered pandemics" like job insecurity by prioritizing the vulnerable.
In sum, Catholic criteria transform investing into mission, do well by doing good.