Charities, foundations and endowments

Effective investment governance is essential for your charity to make informed decisions and achieve positive investment outcomes. We'll help you define goals, investment beliefs, and roles, aligning them with Charity Commission guidelines. 

A robust investment strategy for charities requires careful planning and a structured process. We work alongside you so that our services are tailored to your charity’s specific needs. 

Your appetite to take on risk and the time horizon of your investments will inform the appropriate allocations across asset classes. 

Our investment strategy review process for charities places the emphasis firmly on your objectives, both short and long-term. It is against this framework that we will monitor your strategy and its performance and keep you informed. 

A typical component of our initial investment strategy review is to assess the credentials of your current investment arrangements and manager(s) against your agreed aims. We will only advise changes where there would be a material benefit in doing so. 

Our independence means we are not restricted in our recommendations. That means we can offer a truly objective view of the managers available or the managers you already work with. 

In addition, we believe it is crucial to monitor performance, not only of the individual managers but also of the overall investment strategy, in line with your charity’s aims, beliefs and constraints. 

Your charity will have a goal of making a positive impact on society, so it is right to have an emphasis on your investments being managed sustainably and responsibly.

However, assessing how to invest as a charity sustainably goes beyond ensuring alignment with your values and beliefs. It can also identify material financial risk factors; for instance, due to poor governance issues or environmental impacts. 

Our ESG investing advice for charities is supported by a working group whose expertise draws on the depth of knowledge from across the firm to provide insightful and innovative research, training and support.  

While many of the issues impacting charities will are relevant, the focus on generating a regular income or cash flow to be able to pay grants to the projects they finance without interruption, is often heightened for endowments and foundations. Therefore, the expected return and risk of the investment portfolio should be well-calibrated to ensure stability and continuity. 

The return objective will mostly be expressed as a certain percentage above inflation as the capital needs to be at least preserved in real terms to ensure long-term delivery to the mission of the organisation.  

Given their long-term nature and less regulated environment, endowments and foundations have much more freedom in the way they invest compared to other asset owners. They can accept to invest larger portions in illiquid assets, private markets and new types or niche asset classes to capture risk premia not always accessible to other investors.