The largest 300 trusts and foundations in the UK collectively hold approximately £89bn in assets, including historic endowments and funds raised. Most of them use traditional fund managers to invest their assets and deploy investment income to accomplish their charitable missions through grant-making. Most foundations invest in mainstream financial assets without explicitly aligning their capital with their impact themes.
However, that is changing, as more UK foundations review their investment policies and allocate a share of their assets to impact.
The UK foundations leading on impact
Joseph Rowntree Foundation (JRF) with an endowment of around £400m has long applied Environmental, Social and Governance (ESG) criteria to their financial investments, but they also began to invest their assets to pursue their core mission to eradicate poverty alongside financial returns. Since 2015, they have built a £25m portfolio of direct and fund investments in social housing, financial inclusion and other social missions. In 2025, JRF announced that they would be investing their entire endowment with social impact.
Similarly, Esmée Fairbairn Foundation has made 82 social fund investments to date (£42.4m of its £1.3bn endowment at the end of 2024), building a diversified portfolio of equity, social lending and land to achieve its aims, including Natural World and A Fairer Future. It committed £9.1m to social impact across 16 investments in 2024.
In the last few years more UK foundations have announced that they had changed their investment policies, hired specialist impact investing advisers and made their first impact investments.
In 2020 and again in 2026, several foundations including Friends Provident Foundation, The Blagrave Trust and Cripplegate Foundation ran a competition to select a fund manager to invest their pooled investment with impact. The latest winner was Triodos Investment Management, appointed to invest £50m on behalf of six foundations.
Many foundations, such as City Bridge Foundation, which focuses on supporting communities in London, start with direct loans to mission-aligned social enterprises. Having set aside £22m for social impact investments, they lent £600k to West Ham United Foundation to expand Beckton community hub and £1.75m to YMCA. Their portfolio today consists of social housing investment funds, ethical bonds and multi-asset funds.
The Architectural Heritage Fund, dedicated to promoting conservation and sustainable reuse of historic buildings in the UK, offers loans to redevelop buildings and support activities which benefit local communities.
Other foundations start with equity funds. Barnwood Trust, which cares about people with mental health conditions and disabilities in Gloucestershire, began impact investing in 2025, hiring Goldman Sachs to implement a sustainable and ESG investing strategy; they allocated £5m to investment with impact and put around £1m into Ascension and Daring Capital, VCs which back mission-driven founders.
Some foundations hire their own investment teams to align investment strategies closely with their grantmaking activities.
Vivensa Foundation appointed a CIO in 2023 and has since invested in Bridges Outcomes Partnerships' fund and Eka Ventures, as well as backing companies directly, supporting its mission to fund the future of aging well. In 2023, The Robertson Trust, established in 1961 by three sisters who donated their shares in the family whisky business, announced that they would carve out £20m for social impact investing in Scotland and appointed an in-house adviser.
In early 2026, Health Foundation appointed a veteran fund manager, Alex Schoenfeldt, to help redefine the foundation's investment policy and begin to invest its £1bn endowment to support its mission of building a healthier UK. It made its first investment in Eka Ventures, alongside several foundations, including John Ellerman Foundation, Esmée Fairbairn and Guy's and St Thomas' Foundation. Guy's and St Thomas' is a seasoned impact investor which invests in affordable housing, social outcomes contracts, life sciences and healthcare.
What about the thousands of other foundations?
A recent report by Impact Investing Institute identifies around 10 'first movers' and 15 'fast followers' among UK foundations who have recently committed to changing their investment policies and made first impact allocations.
But what about the rest? There are some 12,000 registered trusts and foundations in the UK, but structural and cultural barriers are constraining the broad adoption of impact investing across these organisations, the Institute's report found.
One of the main reasons is that the investment function and mission delivery via grants are often disconnected, with foundations' investment committees interpreting their roles as solely optimising for financial return.
Meanwhile, trustees are often conservative and risk averse, reluctant to learn about impact investing and review investment policies.
Finally, while responsible investment is well catered for by mainstream fund managers, specialist impact investment advice is relatively scarce.
Why more foundations should invest in impact
Charitable foundations were created to deliver long-term public benefit. Impact investing offers a powerful opportunity to extend that purpose beyond grant-making and into the stewardship of capital itself.
The foundations leading this transition are demonstrating that endowments can become active tools for social change, not simply sources of annual income. The question is therefore no longer whether foundations can invest with impact, but whether they can afford not to.
The remaining foundations in the UK now have an opportunity to move from observing the market to helping shape it – by reviewing investment policies, building internal capability and allocating even a small share of assets to impact investments.
If more of the sector's capital were aligned with charitable purposes, foundations could multiply their contribution to addressing the UK's most pressing social and environmental challenges and position the UK as one of Europe's leading impact investing markets.