What CC14 means for social investment…

The Charity Commission has launched its updated guidance on how charities can use investments. 

Charities And Investment Matters (CC14) clarifies the position around Programme Related Investment (PRI) and Mixed Motive Investment (MMI) for charities. 

Essentially, charity trustees can now decide on an investment strategy which explicitly aims at  social, rather than  mere  financial goals, should they so choose.  Its aim is to provide Trustees with the confidence to not only consider the financial implications for their charity but to also use their investments to further their charitable aims and objectives.

Paul Cheng, Head of  CAF Venturesome says, “This guidance comes at an important time for the social investment market and we hope that more charities will want to look at their investments in a strategic way which furthers their charitable mission. 

There are a variety of ways in which charities could use social investment vehicles for this, from an investment in a social impact bond through to lending funds to intermediaries such as ourselves. 

Charities might even want to consider using their own funds to create investment vehicles which directly further their charitable aims, for example a charitable trust engaged in environmental protection could set up its own social investment fund to provide loans to environmental charities. 

This guidance means that charitable funds can now be clearly used in a variety of ways to further a charity’s mission, thereby helping to develop the social investment market in the UK.”

Click here to read the guidance in full.

Charities get the investment go-ahead from the Commission

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This week saw what will surely be remembered as a milestone in the development of the social investment market: the much-anticipated approval from the Charity Commission that charities can choose to invest for social, as well as financial, returns.

CAF Venturesome, who will participate in the consultation on the guidance before it is fully launched next Spring, hopes it will eventually remove what has stood as a barrier to charities wanting to harness their financial assets for a direct social benefit.

A full article on the consultation can be found at Civil Society’s website, here.