Ethical Performance
inside intelligence for responsible business


majority of UK charities have no SRI policy

June 2003

The UK’s biggest charities routinely risk investing in companies whose activities may conflict with the charities’ aims, a survey strongly suggests.

Thirty-four of 57 of the largest charities have no written socially responsible investment policy, and most have yet to consider SRI issues, according to Just Pensions.

The consortium of organizations, which was set up by the charities War on Want and Traidcraft to promote SRI, describes the findings as ‘worrying’. It says many charities ‘could face serious risks to their reputations if they fail to address these issues’. Just Pensions also found that only six of the 23 charities with an SRI policy engaged with companies. All but one of the 23 used negative screening to weed undesirable companies from their portfolio, mostly to ensure ‘coherence with the charity’s purpose’, and just four instructed their fund manager to identify companies for their positive impact. Nearly all had their SRI policy handled by external fund managers.

Almost two-thirds of the charities with policies (14 out of 23) did not report to supporters on them.

However, a third of those yet to consider SRI issues planned to do so within a year, prompted in part by recent UK government proposals that large charities be subject to a regulation forcing them to disclose policies in this area (EP4, issue 6, p3).

Of the £68billion ($110bn) of assets held by registered charities in 2001, £47bn, or 70 per cent, was invested in equities and bonds.

The Just Pensions report is co-published with the Ethical Investment Research Service and the Charities Aid Foundation.


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