Shopping Cart


Re-reading the Dishonest Steward: Continuing the Conversation on Ethical Investment

Monday, 3 March 2014  | John McKinnon

Australia’s car industry is dying. In 3 years it will be gone.  Whether you blame the unions or the government, one thing is clear: the companies themselves make decisions based on profit. They have shareholders, millions of them, the vast majority of them overseas, who demand higher profits and share prices. Australian jobs count for little or nothing.

As the same time we see corporates flexing their muscles in other areas of life.  Coal and gas companies put our future at risk not only by their very businesses but also through exercising their power over governments, overseeing the dismantling of the (grossly inadequate) measures to combat climate change.

We must admit the reality: we are in an age of corporate power; where money rules, inequality grows and the environment is sacrificed. Furthermore, it is not simply “us versus them” or as our Prime Minister might describe it, “goodies versus baddies”. We are all implicated. Many of us work for large corporations and many of us have investments, either through our superannuation or otherwise, that include these very companies we may rail against. We use their products and utilise their services. We are compromised and implicated in a system that is wrong. What can we do?

I want to turn to an unlikely parable for suggestions. The so-called parable of the Dishonest Steward is probably one of the least understood of all Jesus’ stories. Just what are we meant to learn from this? (For the analysis of the parable that follows I am indebted to Ched Myers.)

The story tells of a manager/steward who is accused of wasting the possessions of his master, a rich man. This should ring alarm bells for us immediately since being rich is not a good thing according to Luke. This is probably because to be rich in first century Palestine invariably meant exploiting others through mechanisms such as land foreclosure or charging high interest, actions prohibited in the Old Testament. The rich man would have been an absentee landlord and one of the ruling class.

So the rich man is not a hero; in fact, in verse nine Jesus refers to his wealth as dishonest wealth (some translations say “worldly” but the word means dishonest).  The rich man is part of a system - an economic system - that exploited the poor and made the rich richer. According to Luke’s logic, it is an inherently evil system.

This rich man has a steward: a manager or bureaucrat who did his dealings. He is the go-between who creates profit for the rich man by making loans, charging exorbitant interest and foreclosing on those loans. This manager is between this evil system and the poor tenants: profiting from the system but also vulnerable to its voraciousness - he is about to be sacked. The charges against him are hearsay and he has no recourse to any proper process.

He is therefore in a bind. How will he survive outside the system? He could beg or labour but thinks both will kill him. He decides on a third alternative: he subverts the system!

What this man does is, in a partial reflection of the Jewish Jubilee/Sabbath tradition, is to cancel some of the debt owed to his master. There is some suggestion that what he writes off is the master’s profit margin – the interest. In doing so he subverts the system – the system that accumulates for the rich. He joins an alternative economic community – the poor – and engages in alternative economic practices – he shares, he redistributes, he gives.

From the rich man’s perspective this is dishonest. But now Jesus gives the punch-line. The master commends him. He has been smart, shrewd.  The rich man has been outsmarted. He can’t renege on the cancellations because of the shame of breaking a contract. The sacked manager has, to a small extent, got his own back. What’s really surprising is that Jesus also commends the manager’s actions.

Jesus then draws out a lesson for the disciples. The children of this world (those who only care for themselves like the manager in the story) are more shrewd than the children of the light (those who claim to be God’s people). The shrewd manager has used dishonest money to help the poor and thus benefit himself in the future. But what have God’s people done with wealth? They are the people who were supposed to cancel debts, free slaves, and restore land. However, they are shown up by the dishonest manager who has, partially and in self-interest, done what God’s people were always expected to do.

This parable comes just after the prodigal son story. The Pharisees were like the older son: they had never run away and squandered anything. They had done nothing wrong. They have done ‘right’. But this story says: No. They have not been faithful with even worldly or dishonest wealth. How could God trust them with bigger things, true riches?

The bottom line is that God’s people had tried to serve two masters. They wanted to keep their dishonest wealth and serve God. Jesus says, “Impossible”.

This story is about an evil economic system ruled by rich people who exploit the poor. A system that destroys community and simply accumulates wealth for the few. Jesus tells of a manager who subverts that system from within to help the poor and rebuild some community.

Like the manager in the story, we participate in an economic system that exploits people and destroys community. From our compromised, colluding position, what can we do to redistribute wealth and rebuild community? Can we, like that manager, subvert the system?

The short answer is ‘yes’, and this is limited only by our imagination. But I want to focus on ideas from within the business and finance world. Can we subvert and transform business from within?

First, we must kill a sacred cow. Companies act the way they do because their officers understand their task as profit maximisation. This has become an article of faith. Influential economist, Milton Friedman, famously stated that ‘there is one and only one social responsibility of business - to use its resources and engage in activities designed to increase its profits.’ Now times have moved since the early 1970s and we now have something called ‘corporate social responsibility’ (CSR). However, even a cursory look behind the whitewashing/green-washing corporate rhetoric reveals that Friedman is alive and well in the corporate world.

However, it needn’t be that way.  The field of ‘Social Enterprise’ is new in an academic sense but in practice predates modern corporations. A social enterprise sits somewhere a charity and profit maximizing business. While precise definitions are elusive and the term encompasses a broad spectrum of organisations, in general a social enterprise has a social aim like a charity but trades in the market and earns revenue like a business.

Let me describe two Australian social enterprises. STREAT is perhaps the poster child for social enterprise in Australia at the moment. Operating in Melbourne, STREAT targets young homeless people with a holistic program that addresses homelessness, mental health, addictions, employment and more. As such it is an expensive, but highly effective, intervention in these people’s lives. While STREAT is organized as a charity, it runs six separate businesses—4 cafes, a coffee roastery and a catering company—in Melbourne that both earn income and provide a place for on-the-job training and employment for the clients.

Furthermore, STEAT established a for-profit subsidiary, with 50% external shareholders, to purchase two of the cafes and the coffee roasting business. In total STREAT now earns over 60% of the revenue it needs to operate and with some further investment is well on the way to its goal of reaching over 1000 young people per year without recourse to donations. STREAT is demonstrating a different approach to capitalism. As one of the investors, I can concur with CEO Bec Scott, “If we look at that first group of investors we’ve got, it’s not just that they love STREAT, it’s that they’re trying to change the system”

A second example: I have the privilege of being involved with Kokonut Pacific Australia (KPA). KPA was founded by agricultural economist Dr Dan Etherington in the early 1990s following his invention of a means of extracting virgin coconut oil at the village level. Its over-riding aim is that of providing sustainable livelihoods for villagers in the Pacific islands. KPA purchases the Certified Organic oil at fair trade prices and markets it both in Australia and globally. While structured as a for-profit business, all profits are channeled into a charitable trust to assist with further industry development in the Islands. KPA currently supports over 30 producer businesses and 400 farmers in the Solomon Islands and has been consistently profitable.

I could go on. There are many examples of businesses that put people and planet first but remain sustainably (but not exhorbitantly) profitable. It isn’t new but it is a challenge to the business/charity dichotomy we have grown used to and a challenge to Friedman’s profit maximisation doctrine.

In the February edition of Engage.mail, Jai Sharma introduced the notion of impact investing. This is the other side of the social enterprise coin. Because these businesses are profitable, they can be invested in. As Jai pointed out, often investments in “bads” generate the money for donating to the  “goods”. Now impact investing can change that. An investment in STREAT enterprises made a good, positive return in its first year. Perhaps these are lower than if profit maximisation were the target but the returns are certainly sufficient to justify it as an investment, rather than a donation.

Such opportunities are growing. They may not be overly visible yet but the onus is on all of us to push our advisors towards such opportunities.

Now for many of us, we don’t have that level of control. We are stuck with large industry, corporate or government superannuation funds. However, that opens up two further opportunities for subversion. Firstly, there is the growing divestment movement. As fund members, you have the right to ask about your fund’s investments in activities or companies you dislike. You can join the growing chorus requesting divestment from fossil fuels for example. You can change banks and/or super funds, away from those loaning to and investing fossil fuels, gambling, alcohol etc. While this has been difficult, various websites have been established to make this easier (see the box).

Secondly, there is engagement. As ultimate owners of shares in large companies (either directly or via superannuation) we have a say in the running of those companies. In the US and Europe, shareholder activism is far more advanced than in Australia and organisations such as the Interfaith Centre for Corporate Responsibility (ICCR) regularly engage with corporates on behalf of shareholders to address ethical issues.  In Australia a sister organisation has been established (the Australian Centre for Corporate Responsibility– ACCR). While it faces a more hostile corporate law landscape, it aims to transform shareholder engagement in Australia. Other organisations are assisting superannuation fund members engage with their funds to encourage the funds to take their votes at corporate AGM’s seriously  (see links in the box).

As I said above, none of this is new. I was both encouraged and dismayed recently when I read The Chocolate Wars by Deborah Cadbury (Harper Collins, 2010). The Cadbury family were Quakers, along with many other 19th century British chocolatiers and other industrialists. Those founders believed strongly in using their business to better society. From providing employee housing, health benefits, better working conditions, education, and concern over supply chains, those Quaker businessmen were well ahead of us in demonstrating a capitalism that worked for people and the planet.

Unfortunately, as the Cadbury company grew, the owners decided to list it on the stock exchange to facilitate growth and liquidity for the shareholders. That led to a loss of control and eventual takeover by Kraft. It remains to be seen what will happen to the ethical priorities of the Cadbury family. It is a lesson in what is possible (“Capitalism can be different”) but also the power of the system to engulf what is good.

So, can God trust us with money? Can we do good with earthly riches? If we look, we can find opportunities to be subversive, to work from our current place of compromise and collusion, and to begin the transformation that will come to its fruition when “the kingdom comes on earth as on Heaven”.



Check out:







Alasdair Livingston
March 4, 2014, 12:07PM
I don't want to boast (or perhaps I do!), but I have had a private interpretation of Luke 16 for years, and never had the guts to publish it in the face of many more scholarly interpretations. The partial reduction of the debts was the first honest and compassionate thing the steward had done for years! We should not be surprised at his commendation by both his master and by Jesus (though for different reasons). So thank you, John. However, I jibbed at your lumping "fossil fuels" with "gambling, alcohol, etc" as though they were equal in iniquity. Billions of people in the world have no electric power in their homes (nor water, nor sewerage), and Christians are in the forefront of those pleading for them and supporting efforts to provide it. And the only way they will get it, until "clean" energy becomes more available, is by fossil-fuel usage. Should we sacrifice their needs to keeping our delicate consciences clean? For the monstrous gambling industry nothing good can be said. But alcohol . . . well, many Christians drink, but are not drunkards. There are many things, like AK 47s and napalm, worse than alcohol, and just as profitable.
Ian Hore-Lacy
March 4, 2014, 8:27PM
Good idea to be 'subversive' in the ways mentioned - other would simply call it responsible.
But let's discard the caricatures of big business and get to some research about companies, directors and performance. I spent 20 years working for one of Australia's largest companies and I reckon you would be hard pressed to find any outfit which did more for employees and local communities in which it operated. Of course it aimed for profits but alongside long-term reputation, social licence to operate, and ethical profile with long-serving employees. CSR is more recent and may be significant or merely a fig leaf.
But yes, do be discerning re investment and employment.
David Price
March 11, 2014, 12:29PM
Brilliant analysis with great examples. Will Fw to my favorite AMP fund manAger David Price
E Saunders
March 17, 2014, 11:56AM
How, precisely, are we "compromised and implicated in a system that is wrong"? We live in an era where an incredible standard of living is avilable to all people, including fresh food and water, transport, housing, education, electricity, sewerage, etc, etc, etc. Corporations provide many of these essential and valuable services to Australians at prices that are set or regulated by independent regulators such as the essential services commission.

These are all good things and it is hard to see how this is an economic system that exploits the poor - the poor benefit from these services without which our lives would be a lot more difficult.

No more than 6% of Australians are living in entrenched poverty at any one time; further, the causes of that poverty are social and familial (family breakdowns, abuse, addiction, etc), not structural or class based. That is, it is not greedy corporations that are oppressing the poor, but other factors that cause that poverty.

It seems hard to avoid the conclusion that your analysis is based on an outdated and wrong marxist class-based understanding of inequality which no longer represents the reality of 21st century Australia.

The reality is that education and employment opportunities, and a high standard of living (exceeding anything in the wildest dreams of people in 3rd world countries, for example) are now more available to more people than ever before. Those in poverty have access to welfare and services (funded in large part by the taxes paid by greedy and exploitative corporations).

What is most frustrating of all is your attempt to dress this outdated Marxist analysis as somehow the Christian view of the world. You have gone way beyond the limits of Scripture.
John McKinnon
March 18, 2014, 6:15AM
Thanks all for your comments. Some responses:

Alasdair: No, fossil fuels and alcohol are not evil in themselves and can even be used for good. However, excessive marketing of alcohol and opposing sensible health regulations around its use is wrong. Continuing exploitation of fossil fuels when their danger is known is also wrong. Opposing measures to encourage clean energy when it is sufficiently available now id also wrong. So, when I use those terms I am referring to these practices, not the items per se. Also, I think you have bought the line of the fossil fuel industry when linking dirty energy with poverty alleviation. Climate change and pollution will not help the poor!

Ian: Agree. There are some good examples out there. I don’t mean to simplistically lump all businesses together. However, there are systematic issues surrounding large corporations and the separation of ownership and responsibility that create the culture for profit seeking above all else.

E. Saunders: I guess we see scripture differently. Yes, in Australia we enjoy a great standard of living but 2/3 of the world does not. Ask employees in South East Asian sweat shops or child miners in Africa etc what they think of Australia’s great standard of living. Ask Bangladeshi’s about to lose their land to sea level rise what they think of oil and coal companies (including Australian companies) seeking to further fossil fuel exploitation. Ask them if they think it is outdated Marxist analysis. In fact, have another read of the gospels and discern Jesus’ attitude to the poor and his harsh commentary on the status quo at the time that allowed the rich elite to exploit the poor.
We are compromised and implicated precisely because we enjoy such a great standard of living and most of the world does not and is paying (via various means not least climate change) for our luxury.

Got something to add?

  • Your Comment


Online Resources

subscribe to engage.mail

follow us

Latest Articles