We are living in an historic moment. This moment makes us consider what is right, as in morally right. It’s easy to talk about what is wrong. What’s hard is to articulate what is right. This can also be said of our financial world.
In fall of 2015, I was invited the United Arab Emirates to represent Community Sourced Capital at EFICA, the Ethical Finance and Innovation Challenge, an annual award made to a financial organization that represents the values of ethical finance. This brought the question of “What is ethical finance?” to front and center for me. “Ethical” and “finance” are words you just don’t see together here in the United States.
I was the only American there. And I was the only woman and the only non-Muslim in my category. I made the long trip to the UAE twice for the competition and had the pleasure of meeting Nobel prize winner Muhammad Yunus—Founder of Grameen bank and considered the grandfather of microlending. He said about CSC, “It is a good business.”
At CSC, we’re engaging with the question: why not put ethics and finance together? We ask, why are people always consumers buying something for themselves, investors looking for the highest return, or philanthropists giving away their money. We think the narrowness of these categories leaves a lot of room for something else– for generous reciprocity in finance.
In the UAE I learned about Islamic Finance, which is considered to be ethical finance. Zero interest lending is one of the components of Islamic Finance and is part of Sharia Law. Islamic Finance, where lending is always “riba-free” (non-interest-bearing) teaches us something about the generous instinct that lives within our Squareholders. Whether or not they know it, Squareholders are taking part in ethical finance.
When I blogged about my trip to UAE back in November 2015 I said:
“…we find that people intuitively understand that their money is creating value when they participate in making a zero interest loan to a business in their community….People WANT to make generous loans to their neighborhood businesses.”
Squareholders use their money to create real value in their communities, and do this outside of the traditional investor, philanthropist, or consumer roles. At CSC we believe it is morally right—it is ethical—to consider money as a tool for creating value in our world, and not to think of it as an end in itself.