REVIEWING PERFORMANCE

If your charity has investments, you should review them regularly to ensure that they continue to support your organisation’s charitable aims.

WHO SHOULD REVIEW OUR INVESTMENTS?

You’ll need to decide internally who should carry out the review, and how often. You should also review your portfolio if:

  • you have any concerns about the performance of your portfolio or your fund managers
  • your charity’s financial situation has changed
  • the economic outlook has changed

Don’t forget

You also need to ensure that your internal review processes are still relevant, or whether they need updating.

WHAT SHOULD THE REVIEW COVER?

How your charity’s investments are performing

Your charity’s trustees should agree on the benchmarks against which to review your charity’s investment portfolio. What these benchmarks are will depend on your charity’s objectives. They could include:


Performance of your fund

Overall performance

What performance did you set out to achieve and how have your funds performed against this expectation?

Returns on your investment

Income and capital returns

What return have you received over a given time frame? Did these returns deliver the results you needed to support your mission?

Risk versus returns

Risk

Are you taking too much risk, or too little?

If funds are underperforming, you’ll need to understand why – and whether you can accept the loss. If funds are overperforming you should ensure that your charity isn’t being exposed to greater risk that your investment policy allows. You can review these in-house, if you have the knowledge, or with an independent financial adviser.

The service provided by the fund manager

This should be carried out independently of the fund manager. If you’re unable to do this in-house you should consult an independent adviser. Find out more about investment advice for charities.

Some things to consider are:

  • how well the manager is performing
  • how good communication is
  • how much admin is required
  • how good the reporting is
  • whether the manager is complying with your investment policy 

WHAT SHOULD WE DO IF WE’RE NOT HAPPY?

Your trustees should always be prepared to intervene if either the investments aren’t performing well or there is an issue with the fund manager. This could include revising your portfolio or switching to another fund which more closely meets your charity’s needs.

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Speak with a charity expert

Our free consultations are informal and informative

We’ll discuss how our investment solutions work, and which options could be a good fit. Or we can simply answer any questions you might have. You don’t have to make any commitment. We’ll simply do everything we can to help, then leave you to make up your own mind.

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Investment involves risk. The value of investments, and the income from them, can go down as well as up and an investor may get back less than the amount invested.  There is no guarantee about the level of capital or income returns that will be generated. Past performance is not a guide to future results.


CAF Financial Solutions Limited (CFSL) is authorised and regulated by the Financial Conduct Authority under registration number 189450. CFSL Registered office is 25 Kings Hill Avenue, Kings Hill, West Malling, Kent ME19 4TA. Registered in England and Wales under number 2771873. CFSL is a subsidiary of Charities Aid Foundation (registered charity number 268369).