:09:57. > :10:07.The hundreds of thousands of pounds they ended up losing. I'm not going
:10:08. > :10:10.to change my support for amnesty because I think amnesty has done a
:10:11. > :10:14.tremendous amount of work. I would be quite wrong, to me, to alter my
:10:15. > :10:21.subscription or anything like that. I think they need a kick up the
:10:22. > :10:25.backside to deal with it. The charity sector as a whole is having
:10:26. > :10:30.to adapt to a very difficult economic climate, last year public
:10:31. > :10:38.donations to charities fell by 20%. One charity has been very successful
:10:39. > :10:42.at finding new sources of income. It beggars belief that kids are living
:10:43. > :10:46.in poverty like this in the UK today. These kids need help. Save
:10:47. > :10:49.the Children is well-known for powerful campaigning to improve the
:10:50. > :10:54.lives of children in the UK and abroad. Most recently in Syria and
:10:55. > :10:59.the Philippines. It has managed to keep its income steady. The charity
:11:00. > :11:06.is nearly 100 years old and it benefits from strong support from
:11:07. > :11:11.the British public. Put my finger in there, there is a bullet hole there.
:11:12. > :11:20.Oh, yeah. This is Spencer Conway, he is a man who likes adventure. Last
:11:21. > :11:27.year, he became the first person to solo circumnavigate Africa on a
:11:28. > :11:31.motorbike. 35 different countries, 51,345 kilometers. It took me
:11:32. > :11:35.nine-and-a-half months. I started in England. I went down the east coast.
:11:36. > :11:40.He wasn't just doing it for the adventure. He raised ?34,000 for
:11:41. > :11:44.Save the Children. Why did you choose Save the Children? Basically,
:11:45. > :11:48.I have two children. I wouldn't like to see them in the position that
:11:49. > :11:54.I've seen a lot of children in Africa. Last year, the charity
:11:55. > :12:00.raised ?284 million. Including a grant of ?29 million from the
:12:01. > :12:05.Government. Much of its income is received during disaster appeals.
:12:06. > :12:09.Whilst large individual donations like Spencer's are of course
:12:10. > :12:12.welcome, increasingly charities like Save the Children are also looking
:12:13. > :12:21.elsewhere in order to grow their income. Dominic Nutt worked of Head
:12:22. > :12:25.of News of Save the Children for two years and subsequently as a
:12:26. > :12:30.consultant. The day of the little old lady making cakes and selling in
:12:31. > :12:34.the village hall for charity is pretty much over. The small donor,
:12:35. > :12:37.it costs more to process, it costs more to fundraise. The absolute
:12:38. > :12:41.direct corporation philosophy of the organisation at the moment is to be
:12:42. > :12:46.chasing the big cheques from the corps rates. In the last three
:12:47. > :12:52.years, Save the Children's income from big corporations has gone up
:12:53. > :12:58.five-fold, from ?3.9 million in 2009, to ?21 million this year. 8%
:12:59. > :13:02.of total income. It's a huge increase. They have done very well,
:13:03. > :13:06.certainly on paper. I think that does come at a potential cost,
:13:07. > :13:12.certainly there is a risk involved in doing that. One of the architects
:13:13. > :13:17.of this change is the charity's current CEO, in May he announced a
:13:18. > :13:23.corporate partnership with GlaxoSmithKline. GSK develop and
:13:24. > :13:28.market drugs that help millions around the world. Recently, they
:13:29. > :13:33.announced new malaria vaccine. What is it in for GSK? They will be
:13:34. > :13:42.detoxifying what would be a patchy brand in the past. It will make them
:13:43. > :13:46.look good, put simply. GSK was a surprise to many as a Save the
:13:47. > :13:51.Children partner, given some of their recent history. In 2001, AIDS
:13:52. > :13:56.was killing millions of people in the developing world. Several
:13:57. > :13:59.charities protested outside GSK's London headquarters about the
:14:00. > :14:08.company's refusal to drop the price of its drugs that help prolong
:14:09. > :14:13.lives. One of the protesters was Justin Forsyth who at the time
:14:14. > :14:16.worked for Oxfam. GSK eventually did drop the price of its AIDS drugs,
:14:17. > :14:22.since then it has continued to attract controversy. Last year, it
:14:23. > :14:28.was fined $3 billion in America in part for promoting the use of adult
:14:29. > :14:33.antidepressants to teenage sufferers.s. They did so knowing its
:14:34. > :14:35.own research to show that it could cause self-harming and suicidal
:14:36. > :14:45.thoughts. This is one of the biggest medical
:14:46. > :14:51.scandals ever. Despite this, in May, Justin Forsyth
:14:52. > :15:01.agreed a partnership with GSK that both sides say would give Save ?15
:15:02. > :15:04.million over several years to combat infant death. Justin Forsyth
:15:05. > :15:07.strongly defends this corporate partnership. There are risks but we
:15:08. > :15:10.weigh those risks. The judgment we make is that guideline is a
:15:11. > :15:13.transformed - GlaxoSmithKline is a transformed company. It is not only
:15:14. > :15:20.a leader in the pharmaceutical sector, it is a leader of corporates
:15:21. > :15:23.in the world. What do grassroots fund raisers
:15:24. > :15:26.think of the deal? It makes me upset, actually. I would say,
:15:27. > :15:33.morally, ethically, it's not really the right thing. What you'll end up
:15:34. > :15:36.is holding court over the charity because they've given them a
:15:37. > :15:41.donation, which I don't believe in. We've spoken to several former and
:15:42. > :15:45.current staff at the charity who are deeply uneasy about the partnership.
:15:46. > :15:51.Certainly, I've spoken to people currently at Save the Children, and
:15:52. > :15:54.they feel uncomfortable account relationship. It is feasible to be
:15:55. > :16:00.at least concerned that the Save the Children will never, ever be able to
:16:01. > :16:05.criticise GSK because they've taken their money.
:16:06. > :16:08.We had a big open forum on this and staff voiced their concerns. The
:16:09. > :16:13.vast majority of our staff and supporters believe we're doing this
:16:14. > :16:18.for the right reasons. We are going to work with them to transform a
:16:19. > :16:26.mouthwash into a gel that will stop children dying from neo-natal
:16:27. > :16:32.accepts cities. Their umbilical cord cut at birth with a tiery scalpel,
:16:33. > :16:36.we can save millions of lives with harnessing that type of innovation
:16:37. > :16:40.with GSK. Save the Children has many corporate partners. Its ten-year
:16:41. > :16:45.relationship with British Gas ended in November 2012, and yield the the
:16:46. > :16:48.charity 1.5 million, helping thousands of the poorest children in
:16:49. > :16:52.Britain. But we've seen evidence that people
:16:53. > :16:56.at the charity feared risking existing and potential corporate
:16:57. > :17:01.partnerships if they criticised the energy industry.
:17:02. > :17:06.Millions of British Gas customers are facing higher bills. Gas will go
:17:07. > :17:12.up by an average of 18 per cent... It is 25 per cent of my household
:17:13. > :17:19.budget. And it is the single largest payment we have. It is either heat
:17:20. > :17:24.the house or feed ourselves. Energy energy price rises are a yearly
:17:25. > :17:26.controversy. Dominic was keen to campaign on the issue when he worked
:17:27. > :17:30.at the charity. Every year, I prepare a line on that, to go to the
:17:31. > :17:34.media to criticise British Gas, that children living in poor families on
:17:35. > :17:37.low incomes would have to make very difficult choices around buying
:17:38. > :17:40.school books, feeding their children correctly, or putting the heating
:17:41. > :17:45.on. Every year, it would be quashed. What do you mean by that, what
:17:46. > :17:48.happened? It was a clear we can't do that because we take money from
:17:49. > :17:51.British Gas. That would have come down from on high. Save the Children
:17:52. > :17:59.did eventually run a actual poverty campaign in January 2012. It
:18:00. > :18:02.criticised the big six energy suppliers. It singled out British
:18:03. > :18:06.Gas as doing the most to help poor families.
:18:07. > :18:10.We've been told by Dominic Nutt, who was a former head of news at Save
:18:11. > :18:15.the Children that, on several occasions, he had press releases
:18:16. > :18:19.spiked because they mentioned British Gas, and were critical of
:18:20. > :18:23.British Gas. It is very difficult for me to answer. That's a couple of
:18:24. > :18:26.years before I even started with Save the Children. We would never
:18:27. > :18:31.decide not to campaign on something because of a corporate partnership.
:18:32. > :18:37.We're quite explicit when we go into these corporate partnerships that we
:18:38. > :18:41.won't muzzle our voice, we won't not speak out around the issues that
:18:42. > :18:44.we're addressing in that corporate partnership. Corporate part they
:18:45. > :18:48.areships are not just about money. Might it not be a good idea at the
:18:49. > :18:52.end of a high-profile campaign document to say, you know, we've
:18:53. > :18:55.mentioned British Gas to be pans partner about their relationship? I
:18:56. > :18:58.think that is a good idea. We publish all our partnerships in our
:18:59. > :19:02.annual report, but, actually, I think you're right. That's not a bad
:19:03. > :19:07.idea to do that in the individual reports. But we found further
:19:08. > :19:11.evidence which suggests self-censorship last year over
:19:12. > :19:16.preparations for a potential fuel poverty campaign against the big six
:19:17. > :19:23.energy companies, including EDF. Panorama has obtained an internal
:19:24. > :19:27.e-mail sent from Save the Children's corporate partnership team pitching
:19:28. > :19:33.to become EDF's charity partner. That would have earned Save the
:19:34. > :19:37.Childre ?600,000 over three years. This e-mail reveals concern at the
:19:38. > :19:42.potential negative publicity for EDF. It shows a fear that a actual
:19:43. > :19:48.poverty campaign wouldn't go down well with EDF, who really want to
:19:49. > :19:53.work with a positive organisation. This second internal e-mail sent
:19:54. > :19:58.four days later indicates that the charity's director of advocacy felt
:19:59. > :20:03.a actual poverty campaign could risk the EDF partnership. We've also seen
:20:04. > :20:06.a third e-mail from the same time sharing concerns that the charity
:20:07. > :20:12.would not run a actual poverty campaign in case it jeopardised a
:20:13. > :20:16.potential partnership with EDF. That strikes me as being an insidious
:20:17. > :20:19.reflection of the culture that I experienced. So, people are
:20:20. > :20:23.beginning to edit themselves, and the culture has perk lated right
:20:24. > :20:27.down, and no-one is now willing to challenge that culture.
:20:28. > :20:33.These e-mails strongly suggest that a actual poverty campaign was
:20:34. > :20:35.unilaterally abandoned for fear of jeopardising potential EDF money. In
:20:36. > :20:39.the event, it didn't work out because the award which was decided
:20:40. > :20:46.by an EDF staff vote went to another charity. What happened at Save the
:20:47. > :20:51.Children was that being warm and friendly and non-challenging to
:20:52. > :20:55.corporates became part of Save the Children's DNA. These e-mails
:20:56. > :20:58.suggest to any reasonable person that Save the Children was
:20:59. > :21:03.considering pulling its punches because of a possible corporate
:21:04. > :21:09.tie-in? No, I don't accept. I mean, with this specific case, we were
:21:10. > :21:11.never going to launch a campaign on energy prices. We had just launched
:21:12. > :21:15.the biggest campaign in our history on UK child poverty, and it was much
:21:16. > :21:21.more controversial than we expected. We looked at the pros and cons, and
:21:22. > :21:24.different staff members argued what would be the best campaign, where
:21:25. > :21:28.would we put our resources? Now, the campaign around energy prices at
:21:29. > :21:33.that time didn't get to first base. Despite his concerns about some of
:21:34. > :21:39.their corporate partnerships, expensor Conway is determined to
:21:40. > :21:41.keep raising money for Save the to first base. Despite his concerns
:21:42. > :21:43.about some of their corporate partnerships, expensor Conway is
:21:44. > :21:45.determined to keep raising money for Save the Children. -- Spencer. I
:21:46. > :21:48.think all charities have their problems but I am not the type of
:21:49. > :21:51.person that would want to give up on a project just because there is
:21:52. > :21:55.negatives. I would rather fulfil the project and try and get rid of the
:21:56. > :21:59.negatives. Of course, running a big charity costs money, and it has to
:22:00. > :22:03.come from somewhere. Save the Children says on its website that it
:22:04. > :22:07.spends about 11 per cent of donations on fund-raising and on
:22:08. > :22:11.overheads. But there is another massive charity that promises not to
:22:12. > :22:16.spend any of the money you donate on its running costs, and that is a
:22:17. > :22:24.charity that most of us have donated to.
:22:25. > :22:28.You've got the money, we've got the funny. The amount of goodwill and
:22:29. > :22:37.generosity in this country is absolutely staggering. 1,000,003
:22:38. > :22:46.hundreds and 16,000. 13 million, 600!
:22:47. > :22:50.Comic Relief has been running Red Knows day since 1985, and it has
:22:51. > :22:54.raised nearly ?1 billion to tackle poverty and social injustice to
:22:55. > :23:00.grants to many charities on the ground worldwide.
:23:01. > :23:04.During the nose day broadcast, celebrities appeal for your money,
:23:05. > :23:07.making the special promise, that every penny donated by the public
:23:08. > :23:12.goes to good causes. Every penny goes straight to those
:23:13. > :23:16.who need it. What it is is money that is going directly to help
:23:17. > :23:22.people. Because we're going to spend all the cash you give us really
:23:23. > :23:27.well. This year's Red Nose Day raised over
:23:28. > :23:33.?100 million. The charity's latest accounts shows it employs nearly 300
:23:34. > :23:38.people with a total running cost of ?17 million a year, of which ?13
:23:39. > :23:41.million goes on the wages bill which has nearly doubled in four years.
:23:42. > :23:50.How does it pay for all of that without taking any money from
:23:51. > :23:53.donations? Andrew Goodwill is a Comic Relief donor and he wanted to
:23:54. > :23:55.find out. Four years ago, he started looking in detail at their publicly
:23:56. > :24:00.available accounts and their website. When you watch Comic
:24:01. > :24:05.Relief, you will hear celebrities say time and time again every penny
:24:06. > :24:09.you donate will go to good causes. That's true, isn't it? It is true,
:24:10. > :24:14.but it's a misleading statement by the omission of the fact that they
:24:15. > :24:18.have to raise these operating costs, so they invest. Fair enough, it does
:24:19. > :24:22.say on the Comic Relief website that not all of the money is given out
:24:23. > :24:25.immediately. It does, but who is going to find it on the website?
:24:26. > :24:30.You've got a whole night of entertainment, and they can't even
:24:31. > :24:34.find 20 seconds to tell you they invest it in the highest yield
:24:35. > :24:39.possible so they can pay their operating costs.
:24:40. > :24:44.We asked Comic Relief why their investment strategy is only on their
:24:45. > :24:48.website, and why they don't explain during the Red Nose Day broadcasts
:24:49. > :24:51.that some of the donated money will be invested for several years with
:24:52. > :25:10.profits used to pay their operating costs? They told us:
:25:11. > :25:16.Comic Relief's website and accounts show that the charity pays out the
:25:17. > :25:20.money you donate to other charities, and that these payments are often
:25:21. > :25:25.staged, sometimes over several years. That means at any one time,
:25:26. > :25:30.Comic Relief holds tens of millions of pounds of investments in the
:25:31. > :25:35.stock market. In 2009, Comic Relief was using
:25:36. > :25:39.these managed funds, which invest the money on the charity's behalf
:25:40. > :25:43.for the best return. Several of the funds publicly listed their main
:25:44. > :25:47.investments, and Andrew saw that some Comic Relief money was invested
:25:48. > :25:51.into questionable sectors like tobacco, alcohol, and arms. Comic
:25:52. > :26:08.Relief told us that: This, they said, is "Accepted as the
:26:09. > :26:12.most professional and safe way to make grants."
:26:13. > :26:17.But do they have to invest in those questionable areas? The regulator of
:26:18. > :26:21.the sector, the Charity Commission, does allow charities to exclude
:26:22. > :26:23.certain types of investment if they fear it could alienate their
:26:24. > :26:27.supporters, providing there is no significant financial risk. Many
:26:28. > :26:35.other charities do invest in a way that involves some kind of ethical
:26:36. > :26:44.screening. Helen WildSmith helps charities do
:26:45. > :26:48.that. An ethical fund she mishas outshone Comic Relief's portfolio.
:26:49. > :26:53.It makes it easy for charities to avoid the pitfalls and achieve the
:26:54. > :26:56.financial returns they need. So ethically screening your funds is
:26:57. > :27:04.not necessarily going to make you less money? It can definitely be a
:27:05. > :27:07.win-win. The academic evidence says that well-diversified institutional
:27:08. > :27:11.common investment funds will not underperform, and you're protecting
:27:12. > :27:17.your reputation, and you're avoiding conflicting with your mission.
:27:18. > :27:21.We've looked at the list of the top 20 best-known charities in the UK.
:27:22. > :27:27.Overwhelmingly, they have investment policies aimed at avoiding conflicts
:27:28. > :27:30.with their key overarching aims. Comic Relief stands out by saying
:27:31. > :27:34.the use of screening for environmental or ethical purposes is
:27:35. > :27:38.not practical. This means that some Comic Relief donations have been
:27:39. > :27:43.invested in a way that seems to contradict the core aims of the
:27:44. > :27:48.charity. Take young people and alcohol.
:27:49. > :27:54.Comic Relief says it is working to reduce alcohol misuse and minimise
:27:55. > :28:00.alcohol-related harm. There is a pregnant woman digging!
:28:01. > :28:04.This year, it helped to launch a new counselling service for children
:28:05. > :28:12.from families with alcohol problems. It just seemed all this to try and
:28:13. > :28:17.then put some money into that we would do something about it. And But
:28:18. > :28:21.through its investment and managed funds, in 2009, Comic Relief had
:28:22. > :28:29.more than ?300,000 invested in shares in the alcohol industry. The
:28:30. > :28:37.majority in Diageo. It manufactures dozens of alcoholic difference. In
:28:38. > :28:45.the same year, Diageo was highlighted as exploiting
:28:46. > :28:49.weaknesses. My hope is that through this specialist and targeted care,
:28:50. > :28:55.these children will have the best possible start in life. Comic
:28:56. > :28:58.Relief's funding partner in the treatment centre is the Royal
:28:59. > :29:03.Foundation, a charity that does screen its investments for alcohol
:29:04. > :29:07.manufacturers to avoid conflict with its charitable work. But this wasn't
:29:08. > :29:12.the only area where Comic Relief's investments seemed to conflict with
:29:13. > :29:16.its core mission. Here, you will find there is a long
:29:17. > :29:23.list of all the different companies, funds that are invested in,
:29:24. > :29:32.donations in. Aerospace and defence? So weapons? Yes. Don't forget
:29:33. > :29:34.weapons manufacturers. Comic Relief's missi statement also
:29:35. > :29:43.commitments to helping people affected by conflict, but in 2009,
:29:44. > :29:47.through the managed funds, it had ?630,000 invested in shares in BAE
:29:48. > :29:49.Systems, one of the world's leading weapons manufacturers. Arms
:29:50. > :29:55.manufacturers are known for generating good profits and paying
:29:56. > :29:57.things like pension funds high dividends. Com Relief isn't a
:29:58. > :30:00.pension fund, so should profit be their only consideration. There is a
:30:01. > :30:06.further issue: in 2009, the charity had even more money invested in
:30:07. > :30:13.shares in another industry which appears to contradict its core aims,
:30:14. > :30:17.and that is big tobacco. TB is a highly infectious airborne disease
:30:18. > :30:22.that's rife in areas of poverty. It can be cured with antibiotics, yet
:30:23. > :30:27.every day, it kills nearly 5,000 people. Comic Relief appeals for
:30:28. > :30:34.money to fight tuberculosis. They've given ove ?300,000 to a charity
:30:35. > :30:39.called Target Tuberculosis. Target TB believes smoking may be
:30:40. > :30:43.responsible for over 20 per cent of TB cases worldwide. While raising
:30:44. > :30:49.funds for this, nearly ?3 million of Comic Relief money was invested in
:30:50. > :30:55.shares in three different tobacco companies in 2009. Over ?1 million
:30:56. > :30:58.was invested in British American Tobacco shares, a company that's
:30:59. > :31:06.come in for strong criticism from some well-known faces.
:31:07. > :31:13.You haven't got the business of an investment. I am sorry, but I am
:31:14. > :31:18.not. Investment dragon Duncan Bannatyne is a honorary trustee of
:31:19. > :31:24.Comic Relief and is well-known for his financial nouse. In 2008, he
:31:25. > :31:29.made this BBC documentary attacking British American Tobacco, accusing
:31:30. > :31:33.them of targeting African children. I've come to Africa to look at a
:31:34. > :31:38.very successful British business, not a business I would invest in.
:31:39. > :31:43.Because its product, if used correctly, will kill up to half of
:31:44. > :31:53.its customers. Cigarettes.
:31:54. > :31:56.Excuse me, can I ask you why you have shares in the tobacco company?
:31:57. > :32:03.Do you care about how many people you kill? By 2009, Duncan Bannatyne
:32:04. > :32:07.was a full trustee of Comic Relief, at a time when it held investments
:32:08. > :32:13.in these two managed funds. Both funds had publicly available facts
:32:14. > :32:17.sheets making it easy to some of the Comic Relief money would have bought
:32:18. > :32:24.shares in British American Tobacco. I asked him what he thinks of Comic
:32:25. > :32:26.Relief's investments? Were you aware of those indirect investments?
:32:27. > :32:31.Nobody can be aware of them, because when you put your money into a fund
:32:32. > :32:36.and your fund deals in it, you can't know what the - it is called the
:32:37. > :32:45.blind trust. Have a look at this. This is publicly available? Is it?
:32:46. > :32:50.This is Artemis Fund and Invetco. Where would you put the money? I
:32:51. > :32:56.wouldn't put donors' money in tobacco conditions. You made a -
:32:57. > :33:00.This is really inappropriate. Very, very good documentary. But But you
:33:01. > :33:05.can't sanction it from these fund? If I never have done. So you don't
:33:06. > :33:11.agree with it? Of course I don't. Do you think they should invest
:33:12. > :33:15.ethically and change their policy? I don't know about changing their
:33:16. > :33:19.policy, they should not invest in tobacco companies, indredgingly as
:33:20. > :33:23.you said a dozen times, it happens. If we can find a way of not doing it
:33:24. > :33:27.indirectly, we will do it. Experts have told us that it can be done. We
:33:28. > :33:32.found several ethical investment funds that screen out investments in
:33:33. > :33:39.weapons, alcohol, and tobacco, which have outperformed Comic Relief's
:33:40. > :33:45.portfolio for three years. There are specialist funds for charities that
:33:46. > :33:49.align with all the things they're trying to achieve, protecting their
:33:50. > :33:52.reputation, and achieving a return. Were you surprised that Comic Relief
:33:53. > :33:56.might be investing in this way? They are risking their reputation, and
:33:57. > :34:01.the charity's reputation is very precious. If people who have been
:34:02. > :34:04.giving them money after watching the television next year think twice and
:34:05. > :34:07.don't give that money because they're concerned about their
:34:08. > :34:12.investment policy, then that could be argued to be a breach of
:34:13. > :34:17.fiduciary duty. Comic Relief organiseses the Red
:34:18. > :34:21.Nose Day broadcast every two years on the BBC, and through this unique
:34:22. > :34:25.platform, the charity has maintained a direct and emotional relationship
:34:26. > :34:31.with the British public. Do it, do it now! Don't wait! Give
:34:32. > :34:38.what you can, because you are Comic Relief. You are the reason for it!
:34:39. > :34:42.Charity Commission guidance says the charities should take donors' views
:34:43. > :34:45.into account when making investment decisions. But Comic Relief won't
:34:46. > :34:55.tell us if they've ever asked their donors what they think about how it
:34:56. > :35:00.invests their money. This is the DK Dance Crewe. Last Red Nose Day they
:35:01. > :35:04.raised hundreds of pounds for Comic Relief. We asked their views on what
:35:05. > :35:06.the charity has done with some of the public's money. At any one time
:35:07. > :35:12.Comic Relief can have tens of millions invested in the stock
:35:13. > :35:16.market. They use something called "managed funds". What you like to
:35:17. > :35:21.guess what kind of companies that these funds invest in They wouldn't
:35:22. > :35:25.be anything that might go against the charity or what they are
:35:26. > :35:33.striving to do. Where do you think they were indirectly investing up to
:35:34. > :35:40.?3 million? Tobacco companies. Disgusting. Disgusting. How many of
:35:41. > :35:44.you are surprised by that piece of information? A recent survey found
:35:45. > :35:49.that 74 per cent of people agreed that large charities should adopt
:35:50. > :35:55.ethical investment policies which prohibit investment in activities
:35:56. > :35:59.that are contrary to their values. Comic Relief initially told us that
:36:00. > :36:04.because of their relatively low rates of return, their higher risk
:36:05. > :36:08.and lack of diversification, investing in ethically screened
:36:09. > :36:11.funds isn't an option that's either legally available to Comic Relief,
:36:12. > :36:16.practical or in the interests of its beneficiaries.
:36:17. > :36:20.So why ask the regulator, the Charity Commission, whether ethical
:36:21. > :36:25.investment is legally available to charities? The core obligation of
:36:26. > :36:30.charities under charity law in the use of funds for investment is that
:36:31. > :36:36.they invest for maximum financial return on charitable funds, but it
:36:37. > :36:42.does allow for ethical investment policies. So if a charity says that
:36:43. > :36:46.they have to get a maximum return, and therefore they're not using an
:36:47. > :36:51.ethical investment policy, is that true? If a charity says we need to
:36:52. > :36:57.invest for maximum financial return, that is right; if they go on to say
:36:58. > :37:02.we therefore can't have an ethical investment policy, that's wrong.
:37:03. > :37:07.Panorama's investigation into Comic Relief's investments is based on the
:37:08. > :37:11.charity's accounts from 2007 to 2009. These accounts showed which
:37:12. > :37:15.funds the charity was investing in. We would like to tell you what Comic
:37:16. > :37:19.Relief is currently investing in, but since 2009, they've changed the
:37:20. > :37:24.way they present their accounts, and it's not now impossible for the
:37:25. > :37:27.public to know. All the funds were listed. You could quite easily find
:37:28. > :37:32.out, it was all public domain information. Now they don't do that
:37:33. > :37:37.any more. There is no transparency at all, really. A recent survey
:37:38. > :37:45.showed 84 per cent of people agreed that charities should be fully
:37:46. > :37:48.transparent about their investments. We've asked Comic Relief where it's
:37:49. > :37:52.been investing your money since 2009, and whether any of it is in
:37:53. > :38:00.shares in alcohol, arms, or tobacco companies? But the charity refuses
:38:01. > :38:06.to tell us. They're saying to us it takes up too much space in the
:38:07. > :38:10.trustees' report, and that it is too time-consuming to list the names of
:38:11. > :38:14.the funds. They won't be in that many funds, and therefore they could
:38:15. > :38:20.be listed in their report and accounts in the normal way. Quite
:38:21. > :38:25.easily? Quite easily. From our point of view as a regulator, transparency
:38:26. > :38:28.is a key consideration. The obligations are a bit stronger on
:38:29. > :38:33.the larger charities than they are on the smaller charities. Any
:38:34. > :38:36.charity, if it landed up beginning to lose crucial support because of
:38:37. > :38:42.things it wasn't telling its supporters that they wanted to know
:38:43. > :38:47.would soon need to reconsider it. As of this point, we don't exactly know
:38:48. > :38:52.where Comic Relief's money is. What do you think of that? I think it's
:38:53. > :38:57.wrong. It's wrong. It's almost like they won't admit that they are still
:38:58. > :39:01.putting into these fund. Comic Relief, if they played it right,
:39:02. > :39:03.could have more donations because if they turn round to everyone held
:39:04. > :39:07.their hands up and said we are wrong, we're now going to screen to
:39:08. > :39:13.make sure we do it ethically, people might jump on the bandwagon and say
:39:14. > :39:16.now they are ethical charity. Comic Relief declined to be interviewed
:39:17. > :39:21.for this programme. In a statement, they told us that their investment
:39:22. > :39:25.strategy, which is consistently delivering strong returns, is kept
:39:26. > :39:29.under constant review, and based on practical, legal, and moral
:39:30. > :39:33.considerations. They also told us: "We put the money into large managed
:39:34. > :39:37.funds as many other leading charities and pension funds do. On
:39:38. > :39:41.balance, we believe this is the approach that will deliver the
:39:42. > :39:43.greatest benefits to the most vulnerable people. Comic Relief has
:39:44. > :39:47.received clear written assurances from the Charity Commission that our
:39:48. > :39:52.investment policy is both appropriate for the broad range of
:39:53. > :39:55.issues we support and within guidelines."
:39:56. > :40:00.As a result of tonight's film, Comic Relief today admitted that it still
:40:01. > :40:04.has funds invested in tobacco, arms, and alcohol companies, but announced
:40:05. > :40:08.that it would be reviewing its investment policy.
:40:09. > :40:12.For all the good work they do, the big charities are under more
:40:13. > :40:15.scrutiny than ever before. The question is: how can they best meet
:40:16. > :40:21.the expectations of the people who give them their money? The British
:40:22. > :40:25.public will never want to stop giving. If they can be better
:40:26. > :40:29.informed about where their money is going and there is better regulation
:40:30. > :40:32.and more openness and transparency, then they can have confidence that
:40:33. > :40:39.it is all in a good cause.