Center conducting research on how Catholic social teaching guides financial decision-making (or not)

February 2, 2022

How do Gospel values impact the financial decisions of Catholic institutions? What difference can Catholic Social Teaching (CST) make in budgeting “on the ground?”

These questions lie at the heart of the Institute for Social Concerns’ Catholic Social Teaching and Financial Decision-Making research project, launched by faculty fellow Clemens Sedmak and research associate Kelli Reagan Hickey in the fall of 2020. The project is based on a simple premise:  “Don’t tell me what you value. Show me your budget, and I’ll tell you what you value.” The idea is that financial decisions are value decisions. They say something about our priorities and our commitments.

The goal of the project is to better understand the budgeting practices of Catholic institutions, as well as to discern practical (and theologically justified) ways these institutions can more thoroughly uphold the Church’s social doctrine in their everyday operations. 

To explore the challenges facing decision-makers in the Church, Sedmak and Hickey interviewed and surveyed over 100 chief financial officers from a variety of Catholic institutions, including dioceses, universities, parishes, and nonprofits. 

Their research produced several insights. First, participants confirmed an ongoing shift in the Church’s managerial culture: clerics with theological expertise are gradually transitioning responsibility to laypersons with extensive experience in business and finance. This shift is promising in several respects. For example, many decision-makers explained their efforts to make values like transparency and accountability central to the Church’s financial culture. But it also presents a risk: that the moral and theological considerations intrinsic to the mission of the Church give way to harder, more contemporary business values like “efficiency” and “maximization.” 

Second, the study found evidence of ambivalent feelings toward CST among decision-makers, many of whom described the Church’s difficult economic reality. One diocesan CFO said that CST is “too idealistic and impractical” to make a difference in Church finance, while another said that applying CST to budgeting “is not only possible, but incumbent.” This split highlights the need for greater education and research in CST, especially research directed toward making CST practical and actionable.

With these challenges in mind, Sedmak and Hickey have designed a CST-inspired tool based on normative criteria such as human dignity, participation, just prudence, community and service, and non-maximization that CFOs can use to better uphold Gospel values in their budgets. The tool, along with insights, themes, and narratives gathered from the interviews and surveys, will be presented in a forthcoming book project.