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Charity Commission public consultation – ‘Investment matters’

The Charity Commission has launched a public consultation about its investment guidance.

Dame Suzi Leather, Chair of the Charity Commission said:

“In 2010, registered charities held nearly £78 billion in investment assets, so clearly this is an important consultation for many trustees. It’s important that where charities are facing a tough funding environment, trustees have the tools to make the best use of their assets…”

The Commission has updated its guidance to reflect how policy and practice have moved on since the last revision to its guidance in 2003. Many charities are now investing to deliver both a financial return and a direct social benefit, often described generally as ‘social investment’. This may involve considering ethical issues or how an investment helps further the charity’s aims directly. Sometimes, these ways of investing can achieve even more for beneficiaries and can therefore represent the best overall return for the charity.

The Commission has set out in draft guidance all the options for investments in order to enable trustees to make the best use of their assets, while also managing risks. The guidance makes clear that it is ultimately for trustees to decide the best approach for their charity, but sets out their duties and responsibilities when making these decisions. For some, this will mean seeking best financial return, for others it will mean a combination of both furthering their charitable aims directly and achieving a financial return.

The draft guidance also explains the different rules that apply to each form of investment. Charities can choose to concentrate on one approach or a combination of different approaches. The consultation will cover the key forms of investment that charities engage in, which include financial investment, ethical investment, mission connected investment and programme related investment.
The consultation document can be found at the c,onsultation period ends on 28 February 2011.



Date: 13th December, 2010
Author: Wendy Bambrick


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