The Church Commissioners have released their annual report for 2020 today. The report (an 83-page pdf) can be downloaded here. There is an accompanying press release, which is copied below.
Church Commissioners report strong long-term investment performance
15/06/2021
Continued strong long-term investment performance enabled the Church Commissioners to extend financial support to the Church of England during the pandemic
Church Commissioners also give confidence about maintaining distributions through this triennium and the next
Determined action on climate change continues whilst the Church Commissioners deepen its focus as Responsible Investors on twin pillars: Respect for People, Respect for the Planet
The Church Commissioners for England extended financial support to dioceses, cathedrals and churches during the Covid-19 pandemic, underpinned by positive financial returns and despite volatile markets.
The Commissioners, in partnership with the Archbishops’ Council, provided £75m of immediate liquidity support and established a £35m Diocesan Sustainability Fund programme, plus a £20m Cathedral Sustainability Fund, following the decline in churches’ and cathedrals’ income from donations and visitors during Covid-19 pandemic lockdowns.
The Commissioners’ returns in 2020 will enable it to maintain previously announced funding levels in the current 2020-2022 triennium (more than £930m). The Commissioners also confirmed today that it expects to be able to maintain funding at broadly the same level in the next triennium (2023-2025). The Commissioners gave £244.1m to the Church last year to support mission activities and ministry support, up from £211.7m the previous year.
Gareth Mostyn, Chief Executive of the Church Commissioners, said:
“We were pleased to be able to work with the Archbishops’ Council and our partners across the Church, to reinforce our support for dioceses, cathedrals and churches during 2020, which was such a difficult year in so many ways. The financial support we quickly put in place helped the Church to weather the sudden and unexpected financial storm. I am grateful to all my colleagues for their work to support the Church and its mission by addressing the financial challenges it faced as well as providing continued practical support, and I’m pleased that our financial returns last year enable us to give increased confidence for our future distributions.”
The total return on the Commissioners’ investments in 2020 was resilient at 10.4%, bringing the fund’s value to £9.2bn as of December 2020. The fund’s average 10-year performance is 9.7% per annum, beating the Commissioners’ target return over that period and also over a 30-year time horizon.
Loretta Minghella, First Church Estates Commissioner, said:
“The Church Commissioners’ active fund management approach came into its own last year, enabling us to maintain our funding for the Church despite the uncertainty that hit some financial markets. It’s a testament to the investment team that the fund’s returns were so strong, and this financial performance will enable the Commissioners to fulfil our mandate to support the Church’s mission now and for the long-term.”
The Church Commissioners’ Responsible Investment team put in place a new Responsible Investment policy underpinned by two principles of Respect for the Planet and Respect for People. The team actively engaged with companies to effect real world change in areas including ethical exclusions, climate change risk and other environmental, social and governance (ESG) issues.
Following extensive engagement by the Church Commissioners and its National Investment Bodies (NIBs) colleagues, 12 companies made changes to meet the NIBs’ 2020 climate change hurdles and nine were excluded from investment because they didn’t meet the standards of the hurdles. The Commissioners will divest holdings in fossil fuel companies by 2023 that aren’t demonstrably on track to achieve the Paris Agreement targets to reduce climate change.
In April 2021, the Commissioners announced its interim goal to reduce the carbon intensity of its investment portfolio by 25% by 2025, to help deliver its Respect for the Planet policy. The 25% reduction target is a realistic goal in our mission to create real world change to transition to a net zero carbon global economy and transition the investment fund to net zero. The Commissioners also commissioned sustainability reviews of see houses and of cathedral readiness to address their carbon footprint in alignment with General Synod’s commitment to the Church (excluding the investment portfolios of the NIBs) being net zero by 2030.
The Commissioners last year also put in place a new voting template that targets board and senior management gender and racial diversity, consistent with its Respect for People policy.
Gareth Mostyn commented:
“Our Responsible Investment team is at the forefront of the investment industry to drive change in the real economy through active engagement and our commitment to net zero. We believe that taking account of ESG issues is an intrinsic part of being a good long-term investor, for both ethical and financial reasons.”
Earlier this year, the Archbishops’ Commission on Housing, Church and Community issued a landmark report, Coming Home, about housing provision in England, which called for a national plan to tackle the housing crisis. The Church Commissioners welcomed the study, which came at a critical time for the nation when so many people are struggling with inadequate homes and living conditions, in an environment worsened by the Covid-19 pandemic. The Church Commissioners are actively exploring a range of initiatives to help deliver the ambitions of the Housing Commission, including the Commission’s innovative suggestion of potentially making some development land available.
Under the leadership of Eve Poole, Third Church Estates Commissioner, the new Cathedrals Measure received final approval from General Synod in 2020 and subsequently received Royal Assent in April this year. The new Measure successfully delivers upon the recommendations from the Cathedral Working Group report of 2018 and will ensure strengthened governance and operational frameworks for England’s cathedrals.
The Church Commissioners for England, which manages the endowment fund of the Church of England, today published its financial results for 2020 and the year’s Annual Report.
The Church Commissioners’ endowment seeks to support the Church of England and its mission in perpetuity, and it invests the fund ethically to achieve excellent returns in the long-term. It agrees three-year “triennium” funding plans (amounting to more than £930m for 2020-22), which cover more than 15% of the Church’s annual running costs. The fund’s investment returns contribute to the cost of mission projects, dioceses in low-income areas, bishops, cathedrals, and pensions. The Church Commissioners is one of the UK’s largest charitable givers.
View and download a copy of the 2020 Church Commissioners’ Annual Report, here.
The figures here are more evidence that the financial pressures on the Church of England are not due to the failure of the Church Commissioners to earn sufficient returns on their investments (or even squandering most of their money). On Page 19 there is a table showing 9.5% return per annum over the last 30 years (so encompassing the losses of the 1990s, thought at the time to be catastrophic) against an already challenging benchmark of 7.7%. These returns are well ahead of stipend inflation. There is a potential argument about whether these returns have been deployed to best effect,… Read more »
Since the 1990s I have not been aware of any complaint that the Commissioners are not achieving sufficient returns on their investments. The discussion really needs to be on why the Commissioners have withdrawn from funding parish ministry and chosen instead to plough money into assorted, often short-term, projects, or to fund posts with improbable job titles that no-one knew were necessary. What on earth is an ‘associate archdeacon’ or a ‘transition enabler’, and why do we need them? Do we really need directors of new worshipping communities to sit in diocesan offices and pester us with e-mails? A few… Read more »
Indeed. Ordained clergy are a scarce resource in the church, and when new posts are created, filling them with ordained clergy will leave holes elsewhere (ie in “traditional” posts). It is good to see the Commissioners supporting the desired growth in the number of ordinands, but even the 50% increase was to stabilise numbers of ordained clergy, not to increase them.
Many thanks again. As I see it the calamitous denouement of the Lovelock years (best told by John Plender and Terry Lovell) was highly convenient for the Colman Commission. It demonstrated that the Fisher/Eve plan of 1954 to make the Commissioners cover all pension costs was doomed to failure, and that the incessant demands of the Church Assembly and Synod to maintain clerical living standards – gutted by the high inflation of the 1960s to 1980s – was utterly insupportable relative to the capital possessed by the Commissioners at the time. People blame Runcie for taking his eye off the… Read more »
Many if not most stipendiary parochial clergy have had zero stipend increase this past year. I think this is accepted because of the pandemic, but hardly a morale boost for the clergy after seeing the annual profits of the commissioners. I know they fund pre-1998 pension payments, but how about just chipping in a bit to post-1998 pensions, which would bring a bit of relief to the dioceses who have to make payments entirely to cover this?
Thank you for publishing this (only yesterday I was querying when it would appear!). I am also most grateful to Mr Bennet for his acute observations, and for reviewing this report with an accountants’ eye. Of course, many of us – myself included – were predicting disaster a year ago when we seemed to be entering what appeared to be the greatest slump since the 1310s. What has happened instead is that – whilst there has been permanent scarring to many parts of society, the Church included – governments almost everywhere have thrown over austerity, turned on the taps, let… Read more »
Not to worry. When the investigation into Queen Anne’s Bounty comes to a conclusion the money will be redirected to other bodies. The Church Commissioners will be able to retire and the body can be wound up.
Many thanks! It struck me that the 1947-48 merger was more of a take-over of QAB by the Commissioners, than the reverse, as QAB was a relatively modest institution. Tracing returns from slavery at this distance is going to be extremely difficult: the QAB fund was essentially a tax on wealthy livings to augment poor ones, but since wealthy livings were often held in plurality with poor ones, it was often a round-about way of siphoning cash from one group of comfortable clergy to another. What we are talking about here is the seed capital of QAB (i.e., returns from… Read more »
Thank you.
On the one hand that’s a disappointingly accurate and full description of the facts, which means that any investigation will end up chasing its own tail and at worst a small sum of money will be used for other means, just so that everyone can feel that honour is satisfied.
On the other hand, I’m delighted to know that my pension seems to be safe and I won’t have to find a job as a piano player in a brothel to make ends meet.
Toby, is it the activity or the location that would irk you? There are other roles in such places that could be profitable given the appropriate gifts. Fatherly career advice to my teenage sons included (a) organised crime, and (b) porn (I was not then in orders, so hold off with the CDMs). The first could be most profitable, the second now less so what with tinterweb. AFAIK neither son paid any attention to my advice. No change there then.
Didn’t Brahms and Satie play the piano in brothels? It can be a path to greatness (though not always to prosperity, as Satie – who lived in a garret – can attest).
Well, I can’t play the piano, so a brothel is as good a place as any not to play it.
Late to the party ….but now we know the truth which seems to read. Run down the clergy, shut churches (sorry GS2222 …better luck next time). We will end up in five years with lots of trendy initiatives from the corporate hubs, formerly known as Dioceses, a few thousand less clergy and a massive balance sheet looking for outlets. But not serving our basic communities, Save the Parish is just scratching the surface but well done. The lack of investment in human capital is nothing short of a disgrace and an insult to Christians.