CC14: Updated Guidance for Trustees Investing Charity Money

Managing and investing charity funds is a delicate balancing act. Trustees have a responsibility to ensure that funds are invested in a manner that aligns with the charitable purpose of the organisation whilst maximising returns. On 1st August 2023, the Charity Commission published updated guidance for trustees on investing charity money.

The updated guidance aims to provide more concise, clearer advice to trustees regarding when their making investments, how to set the charity’s investment policy, how to consider the trustees’ attitude to risk and types of investment to consider.  The new guidance is shorter and has removed confusing terminology that was found to be unhelpful in the previous guidance.

The updated guidance includes:

Examples of issues relevant to trustees making investment decisions that may conflict with the charity’s interests or cause reputational damage.

Step-by-step instructions for trustees to be compliant with the law and steps that trustees are recommended to take as best practice but which are not a legal requirement.

Explains how to make decisions in the best interests of the charity and ensure that decisions are not made with personal motives, opinions, or interests in mind and are always made to further the charity’s purpose.

Helen Stephenson CBE, Chief Executive of the Charity Commission, said:

“Our refreshed guidance will help trustees make well-informed, carefully considered decisions about how to invest on behalf of their charity in a modern context. We would like to thank those who have played a part in helping us shape the updated guidance. We are clear that each charity’s situation is unique, and there is no ‘one size fits all’ approach to charity investments. We are also clear that that trustees have discretion to choose what is best in their circumstances and a range of investment.”

Read the full updated guidance here.

How can we help?

At Hawsons our accountants recognise that not-for-profit organisations have very different requirements from other businesses and are currently exposed to a challenging economic climate.

Our dedicated team of charity accountants fully understands the complex, ever-changing regulatory requirements of the charity and not-for-profit sector. Irrespective of your size we wish to support you to maximise the benefits you could achieve through our specialist professional advice.

Charities & not-for-profit organisations are currently facing extensive changes in their regulatory and legal framework. Given the additional pressures on fundraising, complex tax regimes, internal risk exposure, and stakeholder demands, it has never been more important to obtain specialist professional advice.