The process and intention behind creating a practical guide 

The project to create this new guidance has involved a Reference Group whose members have been a sounding board and useful source of insight on various aspects.  From the earliest discussions on this project, the shared intention has been to create something practical, written without jargon, which can support charity trustees who may be encountering charity investments for the first time.  The guidance is also intended to be relevant for more experienced charity trustees who may have a background in the finance or investment sector, but who may be new to the charity law and regulatory context.  In this way, it is a shared reference point for all trustees of Scottish charities, whether the charity’s investments are stocks and shares, a building, or something else.

What’s covered 

The guidance is intended to have a logical flow through it, from a starting point which considers what investments are, to covering investment powers and trustee duties, and then the context around why investments are held by a charity and the role they play.  Investment policy is covered in some detail, as well as signposting that an investment policy statement is good practice.  Practical aspects around implementing an investment policy are then set out, as well as case studies, a glossary and ten key points in summary.  The importance of effective risk management is a thread running through the guidance.

Help to navigate trickier areas 

Reflecting that this is guidance for the 21^st century, a broader perspective is taken which includes coverage of investments which are intended to deliver both a financial and non-financial return.  It is hoped that the guidance offers help to trustees as they navigate this area, set against the overriding backdrop that trustees should act with care and diligence and in a manner consistent with a charity’s purposes.

The consultation asks three main questions:

1. In your opinion do you think the guidance is clear and easy to understand for charities of all shapes and sizes?
2. Do you think the guidance covers the key issues that charity trustees experience in relation to investments? If not, please explain what else you think it should cover.
3. What other resources do you think it would be helpful for us to include on our website to help charity trustees in relation to investments?

The consultation runs from 13 August to 21 September 2018 and can be accessed here.