Humble in mind but not in deed

Managing the huge and global Catholic Church and its legal responsibilities is no task for the meek

Peter Smith

Last week, an Argentine prelate, Cardinal Jorge Mario Bergoglio, was elected the head of the Roman Catholic Church, taking the name Francis. Much is made of his humility but it is one thing for the new Pope to share the personal values of poverty and humility with his forebears; it is quite another when it comes to his new position.

The Catholic Church is a huge global organisation and leading it is a monumental task. Pope Francis will have to choose wisely his key assistants in the Holy See’s civil service, the Curia, and the Vatican’s Diplomatic Corps.

One obvious (and much reported) matter the Pope will have to continue dealing with, building on the work of Benedict XVI and John Paul II before him, is the scandal of child abuse within the Church.

From a civil legal perspective, the Church, with its unique status as a non-member observer at the United Nations and the European Union, is in a much happier and more productive position.

Catholics frequently make submissions to debates and committees concerning points of public international law. There will be little change here as Pope Francis’ focus on social justice in his home country will be reflected in the Church’s interventions in international forums on the rights of the poor, the marginalised and the oppressed.

This concern will be manifest when the Church takes official positions on the operation of the World Trade Organisation, including the negotiation of new international trade rules and intellectual property rights in pharmaceuticals such as HIV retrovirals and new technologies which can benefit the very poorest people.

The biggest concern the Pope will have in respect of commercial law is the future of the ‘Vatican Bank’. Mirroring the Church’s fundamental status as a charity, the bank is not actually a bank but rather the Institute for the Works of Religion (IWR). Its purpose is to support ­papal initiatives and the Papal Nuncios, the Holy See’s ambassadors, around the world. It also takes deposits (currently almost $7bn (£4.6bn) in total), makes investments and remits money internationally, between dioceses in different countries, for instance. However, it does not lend money in highly-geared arrangements as investment banks would.

In the past, the IWR has been somewhat amateur in its management and consequently has been caught up in scandal, often because of its proximity to Italian clients, some of whom have been involved in murky practices.

The bank has become considerably more professional in the past 20 years. The Pope-emeritus Benedict started implementing changes in 2010 to improve the monitoring and diligence activities of the Vatican’s financial operations and to ensure compliance with international safeguards against the financing of terrorism.

In 2012 Moneyval, the Council of Europe’s anti-money laundering body, found that – on standards ­developed by the G8’s Financial ­Action Task Force – the IWR was graded around the same as Germany and the Czech Republic.

The Vatican is moving in the right direction, and I am confident will continue to do so under Francis.