HFC: Employing fund management expertise to make a difference

Help For Children (HFC), a charity dedicated to combating child abuse, is run by prominent figures within the alternative investment industry. Its structure enables the foundation to more effectively support charities focused on the prevention and treatment of child abuse.

Bang for your buck

“A problem faced by many charities is a high cost base; the administration and fundraising demands can mean that much of the money is spent before they are able to discharge their objectives,” explains Jon May, partner and general counsel at Marshall Wace, who is also a trustee of HFC. “One of the benefits of HFC is that its cost base is extremely low; all trustees work on a voluntary basis and we only have one paid employee in the UK. This ensures that the vast majority of all funds raised are disbursed in grants to charities. We then check that the grants we pay are deployed efficiently and with maximum impact, and not consumed by the charities on their administration costs.”

HFC’s model means that charity selection, much like investment decisions, must be well researched and considered. “We want to have a meaningful impact, and sometimes working with smaller charities can enable us to make up a larger part of a charity’s programme. We also look at repeat funding for projects where the impact is high and our participation helps to attract other funders, enabling the charities to grow further. Naturally, we also work with larger charities where there is a clearly-defined project for which they need funding,” explains May. Some examples of recent grants include Abianda and Dandelion Time, where HFC funded a case worker for each organisation, both of whom have made a positive lasting impact to young peoples’ lives.

HFC’s model, like any good asset manager, has been able to weather difficult periods. “During the lockdowns, despite our income being reduced due to the lack of events, HFC still generated a healthy surplus. All of the trustees and other supporters give up their time for free, which helps a great deal,” says May.

“Given the nature of our industry, there is an immediacy between the trustees and our supporters. This makes things happen, and we are very well placed to find vital causes,” adds May.

Active manager

As any successful fund manager knows, investment decisions are only one part of the puzzle. Equally important is the final outcome. “We’re not just writing a cheque, we’re engaged with the grantees,” explains May. “We’re careful to look at measurable outcomes through ongoing monitoring of those grants and holding our grantees accountable.”

Not only are high levels of engagement important to ensure the effectiveness of grants made by HFC, but the ongoing monitoring feeds back to HFC’s funders. “As we’re raising funds from the alternative investment industry, we need to be able to show the outcomes and tangible impacts of the donations,” says May. “The donors that we want to reach expect to see clear results. It’s not just about handing out cash.”

Skill set

HFC’s team composition brings together skills and expertise from across the alternatives market. “I bring a legal perspective to the Board,” May explains. Other members hail from service providers, including fund administrators and accountancy firms, bringing financial and numeracy expertise. “The Board composition is right for what it does,” says May. “A lot of our efforts are around pitching a really compelling proposition to the industry. In order to have productive conversations with the donors we approach, it helps to have those connections and to relate to them in a way that the donors can buy into.”

Furthermore, in the same way that fund managers bring in external expertise such as research providers and brokers, when appropriate, HFC engages an academic consultant who helps with grant-making. “Clearly, we’re not experts in identifying child abuse so we need someone who really understands that terrible scourge, who can distil the facts and help us scope out different charitable organisations,” explains May. “If we don’t have the expertise in-house, we bring it in.”

Of course, the way in which HFC is set up as well as the influential status of its leadership team brings about several additional benefits; HFC’s events bring together key players across the alternatives space providing opportunities for networking. But as May concludes, “If that happens, it’s ancillary; the only objective that matters is to raise awareness of the cause and to raise as much money as possible to prevent child abuse.”

To find out more about HFC UK, it’s leadership team, upcoming events and how to support its vital work, click here.