The EIRIS Foundation is pleased to respond to the Charity Commission’s call for views on how charities approach investing in line with their purpose and values.
According to their request for feedback as outlined in their blog post on the 15th of January the Charity Commission are looking for answers to the following questions:
‘What are your experiences and current considerations around responsible investments? What do you think are the barriers to more widespread responsible investments and what more could be done to support trustees to invest in a way that reflects the charity’s purpose and values?’
We acknowledge that current guidance doesn’t prohibit charities from taking social, ethical and/or environmental considerations into account with regards to their investments, however, it also does little to encourage them and indeed, it is our belief that charities should be taking their charitable objectives and their public benefit requirement into account when setting investment policy and making investment decisions.
The present guidance gives too many trustees the impression that aligning your investments with your mission is fairly optional (and rather complicated) with the result that all too few charities have clear policies, clear allocation of responsibility for implementation and clear communication with their investment managers.
The risks to the sector, and to public confidence in charities more generally are two-fold: firstly those who support charities can be unpleasantly surprised by revelations that a particular charity has “done the wrong thing” with its investments, and secondly (and perhaps more importantly) that valuable opportunities to advance charitable causes are being missed as responsible investment and corporate responsibility increasingly focus on issues directly related to many charitable missions.
If you have any questions about our response please contact [email protected].