The US Conference of Catholic Bishops updated its Socially Responsible Investment Guidelines in November 2024, and the impact on Catholic investing has been larger and more sustained than most observers expected. By early 2026, we can actually see what happened as a result, and the story is more interesting than either the "finally, reform" take or the "nothing really changed" take.

Here is what the data shows and what I think it means.

What the USCCB update actually said

Before talking about the impact, let me quickly summarize what the update said. The full document is about 40 pages and covers a lot of ground, but the most consequential changes were these.

First, the update significantly expanded the list of companies and activities that Catholic institutional investors should avoid. The previous guidance (last updated in 2003) was relatively narrow, focusing on a fairly short list of direct concerns: abortifacients, pornography, certain forms of weapons, and predatory lending. The 2024 update added a much broader set of categories: fossil fuel companies with no credible energy transition plans, companies that systematically violate workers' rights, companies that profit from human trafficking or modern slavery, and companies that produce or distribute pornographic content even if it is not their primary business.

Second, the update introduced a stronger emphasis on active ownership and engagement. Previous guidance allowed Catholic investors to simply divest from problematic companies. The 2024 update explicitly states that engagement through shareholder resolutions and direct dialogue should be the first tool, with divestment as a last resort when engagement has failed. This mirrors the similar shift in the Vatican's updated guidelines.

Third, the update added specific positive screening criteria. Catholic investors are now encouraged to actively favor companies that contribute to the common good, support family-friendly workplace policies, invest in community development, and demonstrate care for creation. This is a meaningful change because the previous guidance was almost entirely exclusionary.

Fourth, the update clarified how Catholic investors should approach index funds and passively managed vehicles. The guidance acknowledged that index funds are often inconsistent with values-based investing because they hold everything in the index by definition, and encouraged Catholic institutions to consider actively managed alternatives or to work with index fund providers to develop Catholic-screened index products.

The immediate institutional response

The first wave of response came from Catholic institutional investors. Catholic healthcare systems, Catholic universities, diocesan pension funds, and Catholic foundations started reviewing their portfolios against the updated guidelines within weeks of the November 2024 release. By the end of Q1 2025, most of the major Catholic institutional investors had initiated formal reviews.

The results of those reviews started becoming public in mid-2025. The Catholic Health Association reported that its member hospital systems had collectively reviewed about $85 billion in investment assets and had identified material non-compliance issues in about 22 percent of those assets. The most common problems were holdings in pharmaceutical companies with concerning product lines, holdings in consumer companies with pornographic distribution exposure, and holdings in fossil fuel companies without credible transition plans.

The Association of Catholic Colleges and Universities conducted a similar review across its member institutions and found about $42 billion in aggregate endowment assets, with a compliance gap estimated at about 15 percent. Several large Catholic universities, including Notre Dame, Villanova, and Georgetown, announced significant portfolio restructuring in response.

Diocesan pension funds moved more slowly because of the complexity of their governance structures, but by early 2026 most of the major dioceses had adopted the 2024 guidelines and were in the process of repositioning their investments. The Archdiocese of New York, the Archdiocese of Los Angeles, and the Archdiocese of Chicago all made public statements about their implementation timelines.

The net institutional impact is that something like $15 to $20 billion of Catholic institutional money has either been divested from non-compliant holdings or is in the process of being moved to compliant alternatives. That is not a huge amount relative to total Catholic institutional assets, but it is meaningful enough to move markets in certain specific sectors.

The surprise: retail Catholic investor activation

The more interesting story is what happened at the retail level. I did not expect the 2024 USCCB update to significantly change retail Catholic investor behavior because most retail Catholics are not following USCCB guidance documents. But something about the combination of the updated guidelines, the media coverage they received, and the broader post-2024 moment in Catholic life in America seems to have activated retail Catholic investors in a way I have not seen before.

Specific data points. Ave Maria Mutual Funds, the largest Catholic-focused mutual fund family, reported a 34 percent increase in new account openings in 2025 compared to 2024. That is a huge jump for a fund family that had been growing at roughly 8 to 12 percent annually for most of the previous decade.

Knights of Columbus Asset Advisors, which manages both institutional and retail Catholic money, reported a 48 percent increase in retail flows in 2025. Some of that was driven by the broader USCCB guidance, but some was also driven by specific outreach efforts by the Knights to their member base.

The Christian Brothers Investment Services, which manages money for Catholic religious congregations but also accepts retail client money through intermediaries, reported a 29 percent increase in AUM in 2025, most of it driven by new retail accounts.

New entrants also appeared in the Catholic retail space. A handful of new Catholic-focused investment platforms launched in 2024 and 2025, targeting specifically the retail Catholic investor who wanted more direct alignment with the updated USCCB guidelines. Catholic Investor, Sancta Fides, and Cardinal Capital Partners all launched retail products in the 12 months following the USCCB update.

I think what happened here is that the 2024 guidelines served as a focal point for a broader current of Catholic reflection about the relationship between faith and economic life. Catholic social media had been discussing these issues for years, but the official USCCB guidance gave those discussions a concrete hook. Retail Catholics who had been thinking vaguely about values-based investing suddenly had a specific document they could reference and specific actions they could take. The activation was real.

The content and creator ecosystem effect

One of the things that surprised me most was the emergence of a genuine Catholic investing content ecosystem in 2025. Before the USCCB update, there were maybe three or four people producing regular content about Catholic investing. They had modest audiences and their work was mostly aimed at institutional investors or financial advisors.

After the update, the content space exploded. By early 2026, there are probably twenty to thirty regular content creators producing material about Catholic investing on YouTube, podcasts, Substack, and X. Several of them have audiences of 25,000 plus. The combined reach of the Catholic investing content ecosystem is probably around 500,000 to 1 million regular consumers, which is a meaningful audience for what had been a niche topic.

The content is also getting better. The early Catholic investing content was often either overly technical (written by financial professionals who did not explain concepts well) or overly theological (written by academics who did not understand markets). The new wave of creators are doing a better job of bridging the two worlds, explaining specific investment decisions in terms that make sense to both a pension fund trustee and a 25 year old Catholic who just started their first job.

This content ecosystem is doing for Catholic investing what the halal investing content ecosystem did for Muslim investors starting around 2020. It is democratizing access to the category, normalizing the idea of values-aligned investing, and creating a retail pull that is much stronger than what the institutional players could have created on their own.

What is still not working

I want to be honest about what has not worked as well in the post-2024 environment. Three things stand out.

First, the Catholic ETF offerings are still thin. Compared to the halal category, which now has a handful of low-cost ETFs from major providers, the Catholic ETF space has only a couple of options, and neither is particularly cheap or well-designed. The Catholic Investor Fund ETF and the Inspire Fidelis Multi-Factor ESG ETF are both interesting but both have expense ratios above 50 basis points, which is high for what they deliver. A genuine low-cost Catholic ETF from a major provider would probably open up another wave of retail flows, but nobody has launched one yet.

Second, the distinction between Catholic investing and broader ESG investing is still muddled in the marketing materials of some funds. A few funds market themselves as "values-based" or "faith-aligned" without being specifically Catholic, and this confuses retail investors who are trying to align with specific Catholic guidance. The industry would benefit from clearer labeling standards.

Third, the active engagement component of the 2024 guidelines is not being implemented effectively by most Catholic funds. The guidelines said engagement should be the first tool, but most of the Catholic mutual funds are still primarily exclusionary in practice. The engagement infrastructure (proxy voting services, shareholder resolution filing, direct company dialogue) is expensive and requires dedicated staff, and most of the smaller Catholic fund managers do not have the resources to do it well. This is a structural gap that is going to take years to fill.

What I think happens next

Over the next 18 to 24 months, I expect the following developments in the Catholic investing space.

A major fund provider, probably State Street or maybe Franklin Templeton, will launch a low-cost Catholic values ETF, probably priced at 35 to 45 basis points. This product will be explicitly marketed as aligned with the 2024 USCCB guidelines and will become the default retail option for Catholic investors who want broad market exposure with Catholic screening. The launch will compress fees across the entire Catholic fund category and probably put pressure on some of the smaller existing Catholic funds.

The active engagement gap will be partially addressed through a new generation of Catholic asset managers that are explicitly built around engagement rather than just exclusion. I expect at least one of these to raise significant institutional capital by the end of 2027 and to start filing serious shareholder resolutions on Catholic-relevant issues. This will change how other Catholic investors approach engagement.

Retail Catholic AUM will continue growing at double-digit rates. My best guess is that total retail Catholic AUM (across mutual funds, ETFs, SMAs, and robo-advisors) will grow from roughly $25 billion at the end of 2024 to something like $45 to $60 billion by the end of 2027. That is a meaningful expansion of the category.

The biggest question is whether the current retail activation sustains or fades. Catholic attention to these issues tends to come in waves, and the 2024 USCCB update was the trigger for the current wave. If there is no follow-on catalyst, the retail enthusiasm could plateau. But if the Catholic content ecosystem continues to grow and the product offerings continue to improve, the current moment could be the beginning of a sustained transformation of how American Catholics think about their investments.

I am cautiously optimistic. The 2024 awakening feels different from previous moments of Catholic engagement with investing because it has both institutional and retail momentum, and because the content and creator ecosystem is giving it a reach that previous waves did not have. Whether this becomes a structural shift or just a moment depends on whether the industry can deliver on the better products and better engagement that the updated guidelines called for. So far, so good.

The Catholic Investor Awakening: Post-2024 USCCB Update Impact