What to Consider

For some organisations it is a question of how should we invest? While for others it is more a question of where should we invest?

Medium to Large Charities

About 60% of larger charities have no written ethical or socially responsible investment policy (UK Social Investment Forum 2003). New guidance from the Charity Commission advises a focus on such a policy, also stating that ethical investments often have higher returns.

By talking to CB Financial Limited, your charity's requirements are assessed and an investment policy is developed to match your organisation's ethical beliefs.

CB Financial Limited will then help you to select the investment manager who best meets your overall investment needs. With our specialist knowledge and comprehensive financial understanding we can analyse your investment requirements and produce the right results for you in the most cost-effective manner. We have no preferred fund managers and we constantly review and analyse the marketplace to search for the best groups to provide the correct match for our clients.

Smaller Charities

For the smaller charity help with investment choice and options is required, as these specific skills are seldom held in-house.  Many smaller charities simply invest in ‘cash’ (or deposit funds) and their aim is to get the best rate of interest possible

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CB Financial Limited can help source the best terms for ‘cash’, but we also like to go through the process of checking and developing the Reserves Policy with the Trustees and make sure that a suitable Investment Policy is in place.

The Trustees will need to consider future beneficiaries as well as the present ones, and it may be appropriate to carry out a review of moving ‘cash investments’ to longer term active investments to provide a greater return.

Typically, many charities aim to return 3½% above ‘cash’ in this type of situation.  This obviously involves risk, and this needs to be analysed in the context of your particular charity. The Trustees should carry out this Investment Review to ascertain their position.  Sometimes it may result in remaining in ‘cash’, but the situation needs to be considered.  CB Financial Limited can help provide a study for your individual charity.

In the long term various studies have shown that Equities have performed nearly at twice the level of cash, so the question is, should Trustees take some risk to improve long term returns for the greater good of the charity?  This needs to be weighed up.