Barrow Cadbury Trust – Feeling the Heat

Climate change is already impacting the people, places and causes that foundations care about. Still, for a variety of reasons, philanthropy practitioners often struggle to translate their awareness and concern into action at the scale and pace that are required. Investing their endowment and assets in a way that takes climate change into consideration and seeks alignment with a rapid and just transition to a net-zero economy is a lever many foundations have at their disposal, regardless of size or mission area.

By surfacing examples of foundations like Barrow Cadbury Trust, we hope to provide a valuable resource for foundations in their journeys to climate-align their investments.

Type	Grantmaking and operating foundation
Mission	The trust’s mission is to use all of its assets, especially its money, to work with others to bring about structural change for a more just and equal society.
Focus areas	Criminal Justice, Migration, Economic Justice, Responsible and Social Investment
Budget	Annual grantmaking budget: £2.5 million
Endowment	Size of endowment: £90.9 million

Motivation

The Barrow Cadbury Trust, rooted in Quaker values of simplicity, truth, equality and peace, has a longstanding tradition of ethical investing, aligning with its Quaker-derived social value proposition. The trust has been involved in ethical investing since its beginning 103 years ago. Operating with a segregated portfolio for over 50 years, the trust maintains a trans­parent understanding of its investments, conducting quarterly reviews with periodic in-depth analyses.

The evolution towards integrating climate-aligned in­vestments in its portfolio occurred organically, driven not solely by climate change concerns but by a broad­er commitment to activism, reflecting an external shift in understanding and deepening awareness of the global emergency.

Approach

Sara Llewellin, Chief Executive of the Barrow Cadbury Trust, was appointed in 2009 with expertise in social investment, initiating the foundation’s investment in the UK’s first Social Impact Bond. Under her leadership, the board earmarked up to 5% of the endowment for a dedicated social investment portfolio, a commitment later expanded to £6 million (approximately 6.7%). The labour-intensive nature of the trust’s social investments, often surpassing the size of its grants, necessitated the hiring of a dedicated professional to oversee these activities.

The organic evolution towards climate-aligned investments was and continues to be rooted in a broader commitment to using the potential of social activism. Recognising the influential role of its investments, the trust actively engages with companies. In 2013, anticipating the labour-intensive nature of such activities, the trust initiated the Charities Responsible Investment Network (CRIN), facilitated by ShareAction. This network serves foundations pursuing responsible investment approaches, enhancing knowledge and collaboration within the field.

From 2016-2017, the Barrow Cadbury Trust began to acknowledge more strongly the significant risk climate poses to the various issues of its work, from economic justice to migration. Undertaking internal work to align finance with social justice, the foundation incorporated a climate-active approach in its investment policy. This approach prioritises positive and active engagement before considering divestment: The trust consciously chooses not to exclusively invest in companies already aligned with the Paris Agreement goals, opting instead to create opportunities for progress, such as transitioning from fossil fuels to green energy. Engagement occurs through various coalitions, shareholder meetings, letters and resolutions. Mark O’Kelly, Director of Finance and Administration, supported an asset management firm to launch the Climate Active Endowments Fund in 2018. The trust invests alongside the fund with shared investments, supporting engagement activities.

In 2019, the trust became a founding signatory to the UK Funder Commitment on Climate Change, which later become part of the global #PhilanthropyForClimate movement. This commitment prompted the trust to demonstrate its climate change approach publicly. In 2021, the trust posted a comprehensive Climate Change statement on its website, outlining an annual action plan aligned with the UK Funder Commitment’s pillars. The action plan details various ways the trust leverages its investments to address climate change, emphasising portfolio alignment, company engagement and investments with positive environmental impacts.

Success and limiting factors

Success factors

Extensive experience

Leveraging the trust’s considerable experience in eth- ical, responsible and social investment, along with a track record in supporting social change, provided a strong prerequisite for success.

Strategic expertise

The foundation’s ability to bring the right expertise on board played a pivotal role in navigating the complexi- ties of climate-aligned investing and ensuring informed decision-making.

Holistic recognition of climate change

Recognising climate change as a cross-cutting issue al- lowed the trust to instil its relevance throughout the organisation, garnering commitment from board members, staff and broader partners in the field.

Inclusive engagement

Encouraging commitment from the entire organisation fostered a coordinated effort, aligning stakeholders with the trust’s climate goals.

Collaborative learning

Actively engaging with other foundations through discussions and formal networks, such as CRIN and the UK Funder Commitment on Climate Change, facilitated shared learning, contributing to an informed and effective approach.

Limiting factors

Resource-intensive engagement

The active engagement approach demanded signifi- cant time and expertise, posing a challenge in terms of resource allocation.

Complex impact assessment

Assessing, capturing and attributing the impact of in- vestments proved challenging due to the long-term nature of structural change work. The difficulty in quan- tifying and attributing specific outcomes posed limita- tions on evaluating the success of the investments. For example, some changes in company behaviour brought about by active engagement seem significant but are demonstrated to be short term. This is illustrated by the case of Barclays bank which, in 2020, in response to a shareholder resolution, agreed to align its activities to the Paris Agreement and to bring emissions down to net zero by 2050, but continues to finance new oil fields.

Results

Barrow Cadbury Trust’s investment portfolio is now fully aligned with the climate active approach of their investment manager.

The trust’s mission fundamentally revolves around driv­ing change, aiming not merely to alleviate symptoms but to transform structures, systems and government policies, and enact legal changes. It recognises that its investments now play a similarly transformative role, engaging all stakeholders and actively working to shift paradigms. According to the trust’s leadership, the de­velopment of an ecosystem in the field generates more impact than the impact of an individual trust’s invest­ment portfolio.

This signifies a shift in focus towards collaborative and systemic efforts, recognising the significance of broader engagement and the network effect in cre­ating lasting and meaningful change within the re­sponsible investment landscape of the UK charity sec­tor through CRIN and the UK Funder Commitment on Climate Change.

Find the full case study in our report Feeling the Heat: How Foundations Can Use their Investments to Curb Climate Change