Insights
Is your charity’s cash aligned with its values?
Across the UK, many charities are holding substantial cash reserves — often with good reason. Whether earmarked for future projects, reserved for operational resilience or awaiting strategic deployment, this capital represents more than a balance sheet entry. It represents opportunity.
Yet a growing number of trustees are beginning to ask: Is our money working as hard — and as ethically — as we are?
Surprisingly often, the answer is no.
Much of this capital sits in accounts with high street banks or financial institutions whose investment practices may be fundamentally misaligned with a charity’s mission. Whether that’s exposure to fossil fuels, weapons manufacturing, exploitative labour practices or other contentious sectors, it’s increasingly difficult to justify inertia.
The good news? There’s a better path forward — one that preserves financial responsibility and deepens impact.
Why it’s time charities consider investing more strategically
For many charities, the conversation around investment begins and ends with risk. But in today’s environment — with inflation persistently high and interest rates struggling to keep pace — holding large sums in cash often equates to losing real value over time.
Responsible investment is not about chasing returns at the expense of values. It’s about aligning capital with mission, managing risk intelligently and ensuring your reserves are working towards your charitable objectives — not quietly undermining them.
That’s where we come in.
Ethical investment that reflects your purpose
At Path Financial, we specialise in working with individuals, trusts and organisations who care not just about what their money earns but about what it supports. Our ethical investment philosophy is rooted in rigorous research, sustainability criteria and a commitment to real-world impact.
For our charity clients, that means:
- Replacing cash drag with portfolios that reflect both purpose and prudence.
- Aligning investments with your charity’s values, safeguarding reputation and integrity.
- Structuring reserves across short-, medium-, and long-term objectives, ensuring operational liquidity alongside future resilience.
We also understand the governance frameworks charities operate within. We regularly work with boards and trustee groups to help navigate the fiduciary, regulatory and ethical dimensions of investment decision-making.
A tiered approach to responsible investment
Every charity is unique but most share a common need to plan across three key time horizons:
- Short-term needs — cash for operations, payroll and contingencies.
- Medium-term reserves — funds designated for projects or future commitments.
- Long-term assets — capital that can be strategically invested for growth.
Our approach helps charities allocate capital across these layers, always within a risk profile and ethical screen that reflects the organisation’s mission and operational reality.
A conversation worth having
If you are a trustee, finance lead or decision-maker within a charitable organisation, now is the right time to review how your money is held and what it’s supporting.
Even if you are not ready to invest today, a review of your existing arrangements could reveal opportunities for better alignment, stronger impact and improved long-term outcomes.
We would be delighted to explore these questions with you — without obligation — and help you ensure your charity’s capital is not only safe, but purposeful.
Because your charity is already working to create positive change. Your reserves can, too.
UK charities are sitting on £31 billion in cash—an underutilised resource that could be generating meaningful investment returns alongside positive social and environmental impact.*
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*Recent findings from independent consultancy Broadstone reveal that UK charities with an annual income of at least £500,000 collectively hold around £250 billion in assets, of which approximately 13%—equivalent to £31 billion—is held in cash—effectively sitting idle rather than being invested to earn a return. https://fundraising.co.uk/2024/06/04/charities-urged-to-consider-investing-with-data-showing-around-31bn-of-assets-held-in-cash / https://broadstone.co.uk/over-31bn-charity-money-sat-idle/
RISK WARNING
As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.