More spent on managers

Some UK trusts and foundations are spending as much as 16 per cent of their investment assets on managers' fees each year, according to charity performance rankings sponsored by stockbroking firm JM Finn & Co.

The Charity Performance Guide 2007 lists management costs as a percentage of charities' investment assets. The standard percentage range is 0.5-1 per cent. But the Gilmoor Benevolent Fund, an organisation that promotes the activities of Jewish charities, spent £2.79m (16 per cent) of its £17.4m invested assets on fees during 2005/06. Over the same period, grant body the ACT Foundation spent £8.62m (7.63 per cent) of its £113m in invested assets on fees.

The National Institute of Agricultural Botany Trust spent 3.47 per cent of its invested assets on management costs, and Greenham Common Community Trust spent 3.08 per cent. The Henry Moore Foundation and the Islamic Trust were also among the 10 charities with the highest investment management fees, paying £1.74m and £410,000 respectively.

Dennis Taylor, chief executive of the ACT Foundation, said the high percentage for his charity could be explained by the significant costs of managing subsidiary property companies, which form a key part of the foundation's invested assets. No one at the Gilmoor Benevolent Fund was available to comment.

Richard Maitland, director and head of charities at fund management firm Sarasin Chiswell, said fee tables could be misleading. "They can be calculated in a variety of different ways as a result of different accounting conventions and issues," he said.

 

Top spenders on asset managers' fees

 

(ranked by investment management costs management assets as percentage of investment assets managed)

1. Gilmoor Benevolent Fund 16.00% (investment management costs: £2.79m, Investment assets: £17.4m)
2. Airways Charitable Trust Limited 7.63% (£8.62m, £113m)
3. National Institute of Agricultural Botany Trust 3.47% (£0.25m, £7.33m)
4. Greenham Common Community Trust 3.08% (£1.38m, £44.7m)
5. Dartington Hall Trust 3.05 % (£1.03m, £33.8m)
6. Alliance House Foundation 2.70% (£0.24m £8.75m)
7. Marr-Munning Trust 2.52% (£0.25m, £9.78m)
8. Henry Moore Foundation 1.75% (£1.74m, £99.2m)
9. Islamic Trust 1.55% (£0.41m, £26.2m)
10. Hurdale Charity Limited 1.32% (£0.24m, £18.3m)

Figures for year-end March 2006
Source: Charity Performance Guide 2007

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