Donors back charities that 'invest according to objectives'

Five in six people are more likely to give money to a charity if it has an investment policy consistent with its own objectives, according to a new survey from the Ethical Investment Research Service.

Eiris, which provides independent research into the social, environmental and ethical performance of companies, said that more than 90 per cent of people in the survey believed that every charity should have an ethical investment policy.

Eighty-three per cent of respondents said they would be reluctant to donate to a charity if it did not ensure that every company it invested in operated it a way that did not conflict with the charity's objectives.

Just over half of all charities have an ethical investment policy, according to Eiris.

It said its latest survey of 2,000 people in the UK showed a change in attitude from 2001, when a poll for the Charities Aid Foundation found that less than half of the public preferred to support charities which invested ethically, and only one in six said they would only support charities with an ethical investment policy.

"Ethical investment is something that each of the UK's 25,000 charities that have investments should be taking very seriously," said Peter Webster, executive director of Eiris. "It provides charities with real opportunities to further rather than counter their aims.

"If all the £56bn of UK charity investments was invested ethically, this would send a powerful message to companies in terms of social, environmental and ethical corporate behaviour," he added.

Sam Collin, charity project coordinator at Eiris, said: "These findings come at a time when charities are coming under additional scrutiny from their supporters and face increased pressure from the Charity Commission to be more accountable and transparent.

"Charities should be responding to the concerns of supporters by demonstrating that they are using their finances in ethical ways."

The survey also found that four in 10 people said it was "very important" that charities were transparent about how they spent their money. Only one in 10 people said it was not very important.

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