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Why invest?

Investment used to be all about getting more money to further a charity’s aims, but increasingly organisations are looking at whether they can be more effective by investing directly in things that are related to their aims. 

When you are looking at investing your charity’s assets you are encouraged to categorise investments into:

  • Financial investment –  where you are aiming to get best level of return at an acceptable level of risk
  • Programme-related investment – where the purpose of the investment is to support your work, and any return you get is secondary
  • Mixed motive investment – a bit of both, and it’s called mixed motive because neither the financial return nor the contribution to mission would be sufficient to justify the investment on their own

The term social investment is used to cover both programme-related and mixed motive investment.

Where to go for advice?

You do need to take advice – it is a legal requirement unless you (as Trustees) have good reason not to, for example you have sufficient experience in the charity. This is because investments are a risky business.

Further resources

Investment policy guidance for your financial procedures manual.

Last reviewed: 10 April 2021

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This page was last reviewed for accuracy on 10 April 2021

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