# Charity Commission updates guidance on charities & investments

- Link: https://fundraising.co.uk/2023/08/01/charity-commission-updates-guidance-on-charities-investments/
- Published: 2023-08-01T11:58:09+01:00
- Author: Melanie May

**Published today (1 August 2023), the guidance has been updated to make it clearer
and to help trustees make the right investment decisions for their charity.**

As well as clearer language, the structure has been updated to make it shorter and
easier to use.

[The guidance](https://www.gov.uk/government/publications/charities-and-investment-matters-a-guide-for-trustees-cc14)
clarifies that trustees are free to choose what is best in their circumstances with
a range of investment options open to them – provided they ultimately further the
charity’s purposes.

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Known as CC14, it follows a Commission ‘call for information’ and consultation on
financial investment. It also reflects the ‘Butler-Sloss’ case, which was a significant
High Court judgment on charity trustees’ investment duties.

The guidance:

 * includes examples of various issues which may be relevant for trustees to consider
   when making investment decisions, such as the potential for an investment to 
   conflict with the purposes of the charity, or the reputational impact of an investment
   decision.
 * lists steps trustees ‘must’ take to be compliant with the law and those trustees‘
   should’ do which are strongly recommended as best practice but not legally required.
 * explains that acting in the best interests of a charity is about ensuring that
   above all else any decision furthers its purposes. It also warns trustees to 
   not allow personal motives, opinions, or interests to affect the decisions they
   make.
 * incorporates previously separate guidance on social investment and no longer 
   uses terminology that could get in the way of trustees’ understanding, such as‘
   ethical investment’, ‘mixed motive investment’ and ‘programme related investment’.

It also has examples that are designed to help trustees identify the factors relevant
to their own charity’s situation and determine how to approach their investment 
decisions.

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 trustees
> have discretion to choose what is best in their circumstances and a range of investment
> options open to them.
>  
> “We want to stress that investment approaches are your [Trustees] decision to 
> make, and this guidance is designed to help you do so with confidence, and in 
> line with the law.
>  
> “You must balance the potential benefits of your approach with any risks it brings
> to your charity and ensure that your decision ultimately serves your charity’s
> purposes. You may opt to take issues such as sustainability or climate impact 
> into account, provided it is in the best interests of your charity.
>  
> “Our guidance contains clear advice on how to make sure you are compliant with
> the law and following best practice.”

During the drafting process, the Commission conducted user testing with a sample
of 1000 charities, and also engaged with sector representatives and other relevant
stakeholders.

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 * **[Charities urged to consider investing with data showing around £31bn of assets held in cash](https://fundraising.co.uk/2024/06/04/charities-urged-to-consider-investing-with-data-showing-around-31bn-of-assets-held-in-cash/)**(
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