Most churches we speak to aren't short of good intentions when it comes to their finances. What they're often short of is confidence. Confidence that their reserves are being managed in a way that reflects their values. Confidence that they're meeting their trustee responsibilities. And confidence that strong financial returns and faithful stewardship can genuinely go hand in hand.
In 2026, that question matters more than ever. Church finances are under real scrutiny, reserves are being put to work in more complex environments, and the expectations on trustees and finance committees have never been higher. The good news is that the tools, frameworks and expertise to invest well, and invest faithfully, are more accessible than they have ever been.
This guide is for anyone responsible for church finances, whether you're a local church treasurer managing a modest reserve, a trustee overseeing a larger endowment, or a senior leader thinking about how your organisation's money reflects its mission. We've written it from our own perspective as a specialist Christian investment manager, but the principles here apply broadly across UK churches and denominations.
The core argument: Faithful investing and good investment management are not in tension. Done properly, they reinforce each other.
Why 2026 Is a Significant Moment for Church Finances
The financial backdrop for UK churches in 2026 is genuinely notable. The Church Commissioners have approved a record £1.6 billion in distributions from their endowment over the 2026 to 2028 period, a 36% increase on the previous cycle. Their endowment fund returned 10.3% in 2024, reaching £11.1 billion, driven largely by public equities. These are not abstract numbers: they represent real capacity to fund mission, maintain buildings, support clergy and serve communities.
At the same time, the Government's Places of Worship Renewal Fund is making £23 million per year available from 2026, providing a meaningful boost to churches tackling long-deferred building maintenance. The National Churches Trust has found that 64% of congregations are concerned about the condition of their buildings, and this funding goes some way to addressing that.
What this means for your church:
- Larger denominations and dioceses are distributing more, which may affect your own planning and reserves strategy
- Building maintenance costs are real and rising, making long-term investment planning more, not less, important
- The overall environment rewards churches that have thought carefully about their reserves and how they're invested
The broader point is this: 2026 is not a year to leave reserves in low-interest accounts or to defer the conversation about investment strategy. The financial landscape is active, and churches that engage with it thoughtfully will be better placed to serve their communities long into the future.
Stewardship as a Starting Point, Not an Afterthought
For churches, the question of how to invest is inseparable from the question of why. Investment is an act of stewardship, and stewardship is a theological commitment before it is a financial one.
This distinction matters in practice. Generic ESG (Environmental, Social and Governance) investing has become mainstream, but it is not the same as faith-consistent investing. ESG frameworks are designed to manage risk and meet regulatory expectations. Faith-consistent investing goes further: it asks whether your money actively reflects your values, not merely avoids the worst.
What faith-consistent investing actually means
The Church of England's Ethical Investment Advisory Group (EIAG) has articulated a framework built around human flourishing, relationships, care for creation and the common good. In practical terms, this means:
- Exclusions: Avoiding sectors such as armaments, fossil fuels, gambling, tobacco and exploitative lending
- Positive screening: Actively seeking companies and assets that contribute to social and environmental good
- Engagement: Using shareholder influence to press for responsible business behaviour
- Alignment: Ensuring the overall portfolio reflects the values of the investing body, not just a subset of funds
The Methodist Church's Joint Advisory Committee on the Ethics of Investment (JACEI) takes a similarly rigorous approach, ensuring investments avoid alcohol, gambling, pornography and arms, and align with Methodist teachings.
The key insight here is that faith-consistent investing is not a constraint on returns. It is a framework for investing with integrity, and increasingly the evidence suggests it is also a framework for investing well.
What Churches Need to Consider Before Investing
Before selecting a fund or appointing a manager, churches need to be clear on their own position. This is where many organisations, understandably, feel uncertain. Here are the key areas to work through.
Trustee duties and charity law
Church finances are almost always subject to charity law, and trustees have legal obligations that go beyond good intentions. The Charity Commission's guidance on investment is clear: trustees must act in the best interests of the charity, take proper advice, and have a written investment policy. Failure to do so is not a technicality; it is a governance failure.
The Charity Finance Group (CFG) provides practical guidance for charity trustees navigating investment decisions, and it is worth ensuring your finance committee is familiar with the basics.
Your Investment Policy Statement
An Investment Policy Statement (IPS) is the document that sets out your church's approach to its reserves. It should cover:
| Area | Questions to address |
| Objectives | What is this money for? Income, growth, or both? |
| Risk appetite | How much volatility can you tolerate? |
| Time horizon | When might you need to access these funds? |
| Ethical criteria | What sectors or activities must be excluded? |
| Review frequency | How often will the policy be reviewed? |
If your church does not have an IPS, producing one is the single most important step you can take in 2026.
Cash versus multi-asset
Not all reserves need to be invested in the same way. Funds you may need within 12 months should remain accessible and low-risk. Longer-term reserves can be invested in multi-asset funds with a higher growth potential. Getting this balance right, and reviewing it regularly, is what separates a thoughtful reserves strategy from simply leaving money in a current account.
A common mistake: treating all reserves as one pool, without distinguishing between operational cash, short-term reserves and long-term investment capital. These have different risk profiles and should be managed accordingly.
Choosing the Right Investment Manager
Once you have clarity on your objectives and policy, the question of who manages your investments becomes much easier to answer. The right manager for a church is not necessarily the one with the highest headline returns. It is the one whose values, processes and approach are genuinely aligned with yours.
Questions to ask any prospective manager
The Church Investors Group (CIG), which represents faith-based organisations with combined assets of over £26 billion, has published practical guidance on manager selection, appointment and monitoring. Their framework is worth reading in full, but at its core it asks three things:
- Does the manager's ethical approach match your investment policy? Not just in general terms, but specifically. Which sectors are excluded? How are those exclusions applied across all assets, not just a flagship ethical fund?
- How does the manager engage? Ethical investing is not just about what you avoid. Active engagement with companies on governance, environmental and social issues is how long-term change happens. Ask to see evidence of this engagement and its outcomes.
- How transparent is the reporting? You should receive regular, clear reporting on both financial performance and ethical compliance. If a manager cannot show you how your portfolio aligns with your stated values, that is a red flag.
Generic ESG versus specialist faith-consistent management
There is a meaningful difference between a mainstream investment manager who offers an ESG option and a specialist who has built their entire approach around faith-consistent principles. For churches, this distinction matters. A generic ESG fund may exclude the most obvious sectors but will not have been designed with Christian stewardship at its centre.
The question to ask is not "do you have an ethical fund?" but "is your entire firm built around the values we hold?"
How Epworth Can Help
At Epworth Investment Management Ltd (“Epworth”), we were built for exactly this purpose. As part of the Methodist Church's Central Finance Board, our entire approach to investment management has been shaped by Christian ethics and the principle of faithful stewardship. We are not a mainstream manager with an ethical overlay; this is what we do, and it is all we do.
We currently manage around £1.3 billion on behalf of churches, charities and Christian organisations across the UK. Our ethical screening is rigorous and applied consistently across every portfolio we manage, not just selected funds. We exclude sectors including armaments, fossil fuels, gambling, tobacco and high-interest lending, and we actively engage with the companies we invest in to encourage responsible behaviour.
What we offer
- Discretionary portfolio management for organisations with larger reserves that want a bespoke, actively managed solution
- Multi-asset funds for churches seeking diversified, ethical growth without the complexity of a full discretionary mandate
- Cash plus funds for reserves that need to remain accessible but should still be working harder than a standard deposit account
One further point worth knowing: we donate our management fees to Christian Aid. It is a small but deliberate signal of where our values sit.
We understand the pressures facing church finance committees and trustees in 2026, and we know that the conversation about investment can feel daunting. Our role is to make it straightforward, to give you confidence that your reserves are being managed faithfully and well, and to provide the reporting and transparency your governance requires.
A Final Word on Stewardship
The churches and organisations we work with most effectively are those that have stopped treating investment as a separate, slightly awkward conversation and started treating it as an extension of their mission. Your reserves are not just a financial buffer. They are resources held in trust, and how you deploy them says something about what you believe.
In 2026, the case for taking that seriously has never been stronger, or better supported. The frameworks are there. The specialist expertise exists. And the evidence is clear that investing with integrity does not mean accepting lower returns.
If you would like to talk through your church's investment position, we would welcome the conversation. There is no obligation and no pressure. Just a genuine discussion about whether we might be the right partner to help you invest faithfully and well.
Get in touch with the Epworth team at epworthim.com.
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.