Daren Fonda at Smart Money has a great primer on faith-based mutual funds, “Faith & Finance: A Boom in Religious Funds.” These kinds of funds can be understood as a slice of the broader sector of “socially responsible investing.”
As Gregory R. Beabout and Kevin E. Schmeising wrote in 2003 (PDF),
Over the last thirty years the phenomenon of socially responsible investing (SRI) has been changing the face of investment and corporate life, and carries with it the potential to modify a whole spectrum of relations within market economies. The relations of stockholders to corporations, managers to labor, labor to stockholders, and the corporation to the wider society all promise to undergo transformation if the practice of SRI continues to accelerate.
These kinds of funds reflect in some sense the gaining sentiment that John Wesley expressed in his maxim: “Earn all you can.” But this command was linked to others and limited by responsible duty.
Wesley put it this way: “Gain all you can by honest industry” and “by honest wisdom.”
Gain all you can by honest industry and you have taken the first of three steps in Christian prudence with respect to the use of money.