The Charity Commission is urgently looking at changing its guidance so that charitable foundations can invest their funds for a social as well as a financial return, according to Francis Maude, the Cabinet Office minister.
Maude was speaking yesterday at a conference on public service reform held by the RSA, a charity that fosters debate on social and political issues. Maude said the commission's rules meant philanthropic foundations were required to maximise the financial returns on their endowments.
"There are tens of billions of pounds in philanthropic organisations," he said. "This should be allowed to be used to generate mixed returns. I'm happy that the Charity Commission is looking at this urgently now."
In a statement, the commission said: "We are in contact with social investors and HM Revenue & Customs in relation to this issue, which will be covered in our new guidance on investment matters.
"We will be publishing this for consultation later this month and will consider all submissions before publishing the final guidance."