In 1891, Pope Leo XIII issued Rerum Novarum, the landmark encyclical that laid the cornerstone of modern Catholic Social Teaching. More than a century later, its principles—fair wages, safe conditions, and the right to organize—remain vital. Today, Catholic investors face a renewed moral imperative to uphold these values in a rapidly changing economy.

A New Pope Leo for a New Industrial Revolution

When Pope Leo XIV chose his papal name at his election in May, he signaled a renewed commitment to defend human dignity in the face of new threats and opportunities. In his address to the College of Cardinals, he said:

“Sensing myself called to continue in this same path, I chose to take the name Leo XIV. There are different reasons for this, but mainly because Pope Leo XIII in his historic Encyclical Rerum Novarum addressed the social question in the context of the first great industrial revolution. In our own day, the Church offers to everyone the treasury of her social teaching in response to another industrial revolution and to developments in the field of artificial intelligence that pose new challenges for the defense of human dignity, justice and labor.”

Today’s industrial transformation—from global gig work to automation and artificial intelligence—raises profound questions about how we treat workers and how economies distribute prosperity. For investors, these issues are no longer separate from financial performance.

Why Worker Justice is a Material Issue

Protecting the dignity of workers is not only an ethical obligation but also a critical component of prudent investment stewardship:

  • Reputation and License to Operate: Companies linked to forced labor, trafficking, or poor working conditions face costly litigation, consumer backlash, and regulatory penalties. The International Labour Organization estimates that 27.6 million people are trapped in forced labor globally, a risk embedded in many supply chains.
  • Human Capital and Productivity: Companies that underpay or exploit workers face higher turnover, lower productivity, and weaker long-term performance. Fair wages and safe working conditions help attract talent and sustain innovation.
  • Emerging Regulation: Governments (with the exception of the U.S.) are tightening due diligence rules on supply chains, AI ethics, and climate-related labor impacts. Investors who ignore these trends expose portfolios to compliance and transition risks.
  • Climate and Labor Interconnection: Environmental harm and worker exploitation often go hand in hand. For example, mining raw materials for clean tech can involve child labor or unsafe conditions. Workforces with many immigrant laborers, like agriculture and construction, expose workers to extreme heat risks. Ignoring this link undermines both sustainability goals and moral witness.

Putting Mensuram Bonam Into Action

The Vatican’s 2022 document Mensuram Bonam calls Catholic investors to “engage, enhance, and exclude” — actively stewarding capital toward the common good. Many Catholic institutions already live this out through networks like the Interfaith Center on Corporate Responsibility (ICCR), whose Advancing Worker Justice initiative targets forced labor, migrant worker rights, gig economy fairness, and freedom of association.

Engagement is not charity: it is prudent risk management and a powerful expression of Catholic Social Teaching in financial markets.

Balancing Moral Duty and Fiduciary Care

Sophisticated investors know there is no contradiction between faith-driven advocacy and fiduciary duty. On the contrary: labor justice and human rights are material ESG factors that shape long-term enterprise value.

By addressing these risks through thoughtful capital allocation, shareholder engagement, and active proxy voting, investors can safeguard returns while living out the call to defend the dignity of work.

A Path Forward

To honor the spirit of Pope Leo XIII—and answer Pope Leo XIV’s call for our time—faith-consistent investors can:

✅ Scrutinize supply chains for forced labor and exploitation, demanding real transparency and remediation.
✅ Press companies to pay living wages, respect freedom of association, and protect workers from unsafe or abusive conditions.
✅ Engage companies on the responsible use of AI, ensuring that human dignity is never sacrificed for automation and cost-cutting alone.
✅ Champion climate and environmental justice alongside labor rights, recognizing the intersection of ecological and human harm.

Join Us

At SGI, we believe investing is a form of stewardship—a way to protect human dignity, foster prosperity, and build a more just economy for people and planet. We invite you to join us in bringing values and faith consistent investing to life in boardrooms, supply chains, and capital markets.

Together, we can ensure that the legacy of Rerum Novarum remains not just a historic milestone but a living standard for how capital serves people—not the other way around.