4 ways charities can align mission and money

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Lisa Stonestreet of the EIRIS Foundation outlines how charities and social enterprises have an influential and exciting role to play in shaping a more sustainable financial system.

‘Money makes the world go round’ – this is a saying that many of us are familiar with. For those of us who work in the charity and social sector, money or sometimes a lack thereof, will directly impact our ability to work towards and achieve our mission and we are constantly making difficult decisions about how to best use our money. But not all charities have considered that their money can be a tool in another way and that by looking at the financial providers and products they choose through a mission-aligned lens, they may be able to use their money even more effectively.

The EIRIS Foundation strongly believe that charities have an influential and exciting role to play in shaping a more sustainable financial system. By ensuring they are investing and saving responsibly and in harmony with their mission and values charities can reap significant mission‐related, reputational and financial benefits while complementing the voluntary sector's fundamental objective of building a fairer society.

Charities and Responsible Investment

1. Investments: Responsible Investment can take many forms and the options for where and how to invest responsibly have grown significantly in the last few years. The options available will depend on how much a charity is looking to invest, as well as its investment strategy and the ethical, social and/or environmental criteria it would like to adopt.

2. Banking and savings: Charities of all sizes can consider social, environmental and ethical issues when choosing which institution to bank with. High street banks, building societies and mission-related financial institutions provide options for current and savings accounts as well as credit facilities. Social banks, such as Charity Bank, only lend the money deposited with them to organisations making a difference, so your savings can become part of your social mission.

3. Pensions: Considering responsible and ethical pension options may be particularly relevant for charities as their employees may well be concerned about these issues. Pension provision could include providing access to a stakeholder pension scheme, a group personal pension or group stakeholder arrangement, or your own occupational pension scheme. All provide opportunities for incorporating Responsible Investment issues.

4. Donor and partner screening: Your charity may wish to ensure that the companies you work with do not pose a significant risk to your reputation or conflict with your objectives. Developing a policy that guides which companies you are willing to accept funding from, partner with or buy services from can be useful.

If you are looking for further information and help in considering these issues, the EIRIS Foundation are holding an event for charities and foundations on the 11th of July, please see details below. Alternatively, please do get in touch with us, we would be happy to chat and point you in the direction of further tools and resources.

Mission and Money Aligned: Charities and Responsible Investment Date: 11th of July Time: 2pm – 6:30pm Venue: The Foundry, 17 Oval Way, London, SE11 5RR

This is a free half-day event for charities and foundations. Come and learn more about all aspects of ‘good money’ for charities, from pension funds to pooled funds, from bank accounts to discretionary portfolios. Join discussions and workshops focussed on aligning your charity’s mission and values with its financial goals and decisions.

Topics to be discussed include: the role of charities in building a more sustainable economy; fossil-free portfolios; fiduciary duty and the legal context; impact investment and financing the Sustainable Development Goals; and practical advice for small charities.

(Please note this event is only for charity and NGO representatives)

Lisa Stonestreet is Head of Communications and Charity Impact at the EIRIS Foundation. The Foundation is a registered charity working in the area of responsible investment. It has over 30 years’ experience of providing free and objective information on ethical finance and corporate activity to other charities and the public. Find out more about EIRIS Foundation.

Charity Bank is a loans and savings bank owned by and dedicated to supporting social purpose organisations. With Charity Bank, your savings, reserves or surplus funds can earn a competitive rate of interest and be used to create far reaching social impact. Find out more about Charity Bank.

The above does not constitute advice or a recommendation and professional advice should be taken before any course of action is taken.