It's a question we hear from charity trustees more often than you might expect: "Can we really invest our reserves without compromising what we stand for?"

For faith-based organisations, this tension feels particularly acute. Your charity exists to serve a calling, whether that's local outreach, global mission, social justice, or care for the vulnerable. The idea of placing your reserves into financial markets can feel at odds with that purpose, especially if you're uncertain about where that money ends up.

We want to be direct: yes, charities can invest money and stay true to faith-based principles. Not only is it possible, but when done thoughtfully, investing your reserves can actively strengthen your mission rather than undermine it.

Here's what every faith-based charity trustee should know.

The Law Is On Your Side

Many trustees assume that their legal duty to maximise financial returns means they cannot apply ethical or faith-based criteria to investment decisions. This is a common misconception, and one that the Charity Commission addressed directly when it updated its CC14 guidance for charity trustees.

The updated CC14 makes clear that trustees can legitimately:

• Avoid investments that conflict with your charity's purposes (for example, a Christian charity avoiding companies involved in gambling or exploitation)
• Apply ESG factors such as climate, human rights, and community impact where these protect or enhance the value of your investments over time
• Use your shareholder vote to influence corporate behaviour in line with your values
• Exclude investments that could harm your charity's reputation among its supporters and beneficiaries

The key principle: trustees must act in the best interests of their charity. The Charity Commission is explicit that "best interests" is not purely financial. Reputational risk, mission alignment, and the confidence of your donors and beneficiaries are all legitimate considerations.

Two-thirds (67%) of charities surveyed in 2024 had already reviewed their investment policy statement following the CC14 update, according to the Newton Charity Investment Survey. The direction of travel is clear: values-aligned investing is not a fringe position. It is increasingly mainstream, and it is legally supported.

What Faith-Based Investing Actually Looks Like in Practice

Faith-based investing is not simply about avoiding a list of bad sectors and hoping for the best. Done properly, it involves a structured ethical framework that actively shapes every investment decision.

At Epworth Investment Management Ltd (“Epworth”), our approach is grounded in seven Christian ethical pillars, which we apply consistently across all portfolios:

Ethical Pillar	What It Means in Practice
Creation Care	Avoiding companies causing serious environmental harm; engaging on climate
Labour	Screening for poor labour practices, modern slavery, and exploitative supply chains
Equality	Promoting human dignity and opposing discrimination
Conflict	Excluding armaments and companies supplying weapons to oppressive regimes
Society	Avoiding gambling, alcohol harm, and industries that damage communities
Health & Wellbeing	Screening out tobacco and companies undermining public health
Fairness, Responsibility & Transparency	Holding companies to account on governance and ethical conduct

These are not vague aspirations. We apply published tolerances (0%, 5%, and 10% thresholds depending on the issue) so that trustees can see exactly where the lines are drawn. We also apply conduct-based exclusions for serious breaches of international norms, such as violations of the UN Global Compact, UN Guiding Principles on Business and Human Rights, or ILO standards.

Screening Is Only Half the Story

Exclusion gets most of the attention, but engagement is just as important. We actively vote at shareholder meetings and engage with company management to push for better standards on human rights, environmental practice, and governance. This is stewardship in the truest sense: using the influence that comes with investment to encourage the kind of corporate behaviour that reflects Christian values.

For Catholic organisations, our approach is also guided by the principles set out in Mensuram Bonam, the framework for Catholic-inspired investment, ensuring alignment with Catholic Social Teaching on human dignity, care for creation, and the common good.

Does Ethical Investing Mean Accepting Lower Returns?

This is the concern we hear most often from trustees, and it deserves a straight answer.

The evidence does not support the idea that ethical screening leads to weaker performance. In fact, the investment landscape for charities has improved considerably. According to the 2024 Newton Charity Investment Survey, reports of investment performance below 3% fell dramatically from 70% of respondents in 2023 to just 14% in 2024. Meanwhile, the proportion of charities reporting returns of 9-12% rose from 3% to 21% in the same period.

Faith-based investing does not require you to sacrifice returns. It requires you to be intentional about how you pursue them.

There are a few reasons why this matters:

• Excluding sectors like fossil fuels and armaments has, over recent years, often meant avoiding significant regulatory and reputational risk
• Companies with strong governance, labour practices, and environmental standards tend to be more resilient over the long term
• Active engagement with companies can improve their performance, which benefits investors

At Epworth, we manage around £1.3 billion in assets on behalf of churches, charities, and faith-based organisations across the UK. We have been doing this for decades, and our track record reflects the fact that principled investing and prudent financial stewardship are not in conflict.

What About Liquidity?

A related concern for many charity trustees is access. Reserves need to be available when ministry or operational needs arise. Our Epworth Cash Plus Fund is specifically designed for this purpose: it offers same-day access to deposits while currently targeting a competitive rate of 4.07% AER. Ethical screening applies here too. Funds are pooled and invested through diversified, high-quality financial instruments across multiple banking counterparties, with Epworth actively managing based on interest rate outlook and counterparty suitability.

Your Reserves Can Work Twice

One of the things we are most proud of at Epworth is that investing with us does not just protect your mission, it actively extends it.

Through the WS Epworth Multi-Asset Fund, 50% of the fund's management fee is donated directly to Christian Aid's In Their Lifetime programme, which supports community-led projects tackling poverty, climate resilience, and inequality around the world.

This means your reserves are doing two things simultaneously:

1. Growing over the long term through a diversified, ethically screened portfolio of equities, bonds, property, cash, and alternative assets
2. Supporting active charitable work right now through the Christian Aid partnership

For Christian charities, this is a powerful proposition to put to your trustees and supporters. Your investment policy is not just a financial document; it is a statement of your values in action. And with the Charity Commission's 2025 data showing that 66% of the public believe charities operate to high ethical standards (up 5 points year on year), demonstrating that alignment between your reserves and your mission has never been more important for maintaining public trust.

The WS Epworth Multi-Asset Fund is accessible from as little as £1,000, making it a practical option for charities of all sizes, not just the largest endowments.

Transparency and Accountability for Trustees

We understand that trustees carry a real responsibility when it comes to investment decisions. You need to be able to explain your choices to your board, your supporters, and your beneficiaries. That means the reporting you receive from your investment manager matters enormously.

At Epworth, we publish our approach in full. This includes:

• Stewardship Code reporting, setting out how we exercise our responsibilities as a shareholder
• JACEI (Joint Advisory Committee on the Ethics of Investment) accountability, which provides independent ethical oversight of our investment decisions
• Fund factsheets and regular updates explaining our screening, engagement activity, and voting record
• Ethical outcome reports that you can share with trustees and use in donor communications

This level of transparency is not standard across the industry. For a faith-based charity, it is essential. You should be able to look your supporters in the eye and explain not just that your investments are ethical in principle, but precisely how and why.

"From the Christian faith-based perspective, I think it is the best there is." Epworth client, Catholic organisation

If you would like to see how this works in practice for organisations like yours, our case studies page walks through five real-world examples, from international development charities to denominational structures managing multiple local congregations.

The Bottom Line

The question is not whether faith-based charities can invest responsibly. The question is whether you can afford not to.

Uninvested reserves lose real value over time to inflation. Meanwhile, the organisations that are investing their funds thoughtfully are growing their capacity to serve, maintaining donor confidence, and demonstrating that financial stewardship and Christian values belong together.

The short answer to the original question:

• Yes, charities can invest money and follow faith-based principles
• The Charity Commission's CC14 guidance explicitly supports values-aligned investing
• Ethical screening does not require sacrificing financial returns
• The right investment partner will give you full transparency, published ethical criteria, and reporting you can share with your board

Epworth was founded on exactly this conviction. As a wholly-owned subsidiary of the Central Finance Board of the Methodist Church, our ethical mandate is not a marketing position; it is who we are. We are authorised and regulated by the FCA, and our approach is grounded in decades of experience serving churches and charities across the UK.

If you are a trustee wondering whether investing your reserves is compatible with your charity's calling, we would be glad to talk it through. Explore our Christian charity investment solutions or visit our churches page to learn more about how we work with faith-based organisations of all sizes.

Epworth Investment Management Limited (“Epworth”) is authorised and regulated by the Financial Conduct Authority (FCA Registered Number 175451). It is incorporated in England and Wales (Registered Number 3052894), with a registered office at Methodist Church House, 25 Tavistock Place, London WC1H 9SF and is wholly owned by the Central Finance Board of the Methodist Church. Epworth-managed funds are designed for long term investors. The value of units in funds can fall as well as rise and past performance is not a guide to future returns. The level of income is also variable and investing in Epworth

funds will not be suitable for you if you cannot accept the possibility of capital losses or reduced income. Any estimates of future capital or income returns or details of past performance are for information purposes and are not to be relied on as a guide to future performance.