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Impact Investing: The Core of Jewish Philanthropic Responsibility

Editor's note: Spring is a season of significance for the three major monotheistic religions of the world: Judaism, Christianity, and Islam. In a three-part series of articles, members of Calvert Foundation's Jubilee Assembly explore how impact investing embodies elements of their faith traditions.

Rabbi Yishmael (second century CE) said,

"One who wishes to acquire wisdom should study the way that money works, for there is no greater area of… [sacred] study than this. It is like an ever-flowing stream."

-Babylonian Talmud, Bava Batra 175b

As the late Jacob Neusner wrote, “Judaism, a world construction, encompasses all subjects that pertain to the life of an entire nation and society.” To that end, the great rabbinic teachers of the Mishnah (the law code on which the Talmud is based) developed a comprehensive body of thinking that addressed both economics and sociology, wealth-building and class.

In their thinking about economics and equity, the rabbis were infused with and influenced by the Hebrew Bible with its laws in the Torah and attitudes derived from the Prophets. For them, both justice and ethics lay at the center of Judaism’s extensive teachings about money and finance. That is why the Hebrew word for philanthropic giving and impact investing is tzedakah, which comes from tzedek meaning 'justice' or 'righteousness'. Tzedakah is often translated as 'charity' but it is much more than that; it is about financially assisting people in poverty and at society’s margins, as well as maintaining communal institutions. Thus, Judaism understands tzedakah as a process not an isolated act of justice and righteousness.

Judaism further emphasizes the obligation to lend money to the poor. According to the great medieval Jewish philosopher Maimonides (12th century), what we today call "impact investing" is the highest degree of tzedakah. In his guide to Jewish law Maimonides explains the Laws of Gifts to the Poor. He classifies eight levels of tzedakah and the highest level,

“above which is no other,” is that of the person who assists a poor person by providing him with a gift or a loan or by accepting him into a business partnership or by helping him find employment in order to strengthen his hand until he no longer needs to ask aid to others.”

Maimonides understood that a loan which helps individuals become economically self-sufficient is far more valuable than a one-time contribution. Impact investing leads to self-sufficiency and economic mobility, enabling those who are economically disenfranchised to lift themselves up through their own skills and determination. Therefore engaging in tzedakah helps us build community by fulfilling our responsibilities to others. Alone, none of us can eradicate poverty, but by embracing impact investing as a collective enterprise we can approach the vision laid out in Deuteronomy 15:

“There shall be no needy among you…”

Together we can and will make a difference.

Sandra Lawson is a rabbinical student at the Reconstructionist Rabbinical College. Prior to starting rabbinical school, she served in the United States Army as a Military Police person specializing in Police Investigations, and cases involving child abuse and domestic violence. After the military she started a personal trainer business, and obtained a Masters Degree in Sociology from Clark Atlanta University. After graduate school Sandra worked as an Adjunct Instructor of sociology, and served as the Investigative Researcher for the Anti-Defamation League's Southeast Region, becoming the go-to person when Law Enforcement in the South needed information on hate groups. Sandra also has a background in social media marketing and has managed social media accounts for several non-profits and individuals.

Jeffrey Dekro is the Faith-based Investing Director at Calvert Foundation. For more information about the Jubilee Assembly please email him directly at