THE Church Commissioners delivered a return of eight per cent in 2025, their annual report records. Of their largest 20 equity holdings, 14 are now in technology companies, including Amazon, Apple, Alphabet (the parent company of Google), and Meta.
Published on Tuesday, the report announces the 17th consecutive year of positive returns, bringing the ten-year average to 8.6 per cent. Over a 30-year period, the average return was 9.2 per cent.
The report warns, however, that “the current geopolitical environment and high-risk asset valuations create significant uncertainties for the Church Commissioners’ investment portfolio.” The Iran war is referred to as one factor.
“Given current high valuation levels — the highest in many cases since the dot-com bubble of the late 1990s — there is significant scope for volatility in markets,” the report says. While the risk is being managed, “hedging strategies cannot fully protect the portfolio from the impact of market movements.”
Last year, the Commissioners announced a record distribution to dioceses of £1.6 billion for 2026-28 — up one third from the previous period.
In a foreword, the Archbishops of Canterbury and York warn: “While the 2025 fund performance was above the long-term return target, we must acknowledge that the elevated distributions agreed for the 2026-28 triennium are not sustainable in the medium to long term, so the total level of distributions will need to reduce thereafter.”
Expenditure in 2025 was significantly higher than in 2024: £602.3 million, compared with £370.2 million. This, it says, was “driven primarily” by a £98.6-million increase in pre-1998 clergy-pensions expenditure, and the recognition of a new £137.3-million provision for the National Redress Scheme.
Almost one third of the asset allocation was in public equities, mainly in the technology sector. In private markets, the report says, “venture capital performed strongly helped by the AI [artificial-intelligence] boom.”
In 2024, the Ethical Investment Advisory Group (EIAG) published its guidance on AI. This affirmed that there was “a clear case for investment in AI and the benefits it can bring to society and human flourishing”, but called on companies to “take moral responsibility for the additional risks associated with these systems”. This included ensuring that, in the case of job replacement, they offered “fair and equal opportunities for high-value upskilling and reskilling”.
Both Microsoft and Meta — two of the Commissioners’ largest holdings — have announced sweeping staff reductions as they invest in AI. Concerns have also been raised about the accuracy of Google’s AI summaries
The EIAG guidance states that the Church’s national investment bodies should “be aware of the potential for any new AI technology to be used for nefarious purposes, even if the developers have no intention of marketing towards such applications”, and these bodies should pay particular attention to “uses in which AI replaces, and therefore devalues, human relationships without explicit consent and awareness, particularly with respect to children and other vulnerable people”, and to “unjustified and disproportionate surveillance, including mass surveillance and social scoring”.
On 5 June, the Archbishop of Canterbury is due to host a House of Lords debate on “the impact of AI on human relationships and society”. It follows the publication this week of the Pope’s first encyclical, Magnifica Humanitas, which calls for a Christian humanism capable of “disarming AI” by rebutting “the assumption that technical power automatically confers the right to govern” (see pages 1 and 9).
Among the achievements listed in the Commissioners’ report is the approval secured for more than 5000 new homes to be built on church land.
The First Church Estates Commissioner, Alan Smith, defending the commitment to engaging in work to address climate change, writes that, while “some institutions have pulled back on this work in the face of pressure”, the Commissioners believe that “climate risk is economic risk.”
The report also underlines their commitment to Project Spire. While the aim was to have established a new delivery entity by the end of 2025, the report lists as progress “further engagement with the Charity Commission on the intention to establish a new £100-million in-perpetuity impact investment fund”.
The Commissioners have “engaged with a range of views, including dissenting perspectives”, it says. “Initial engagement began to develop theological underpinnings for a new fund.”
Expenditure on racial justice in 2025 stood at £7.3 million. Grants included a three-year allocation of £500,000 to the diocese of Leicester for the appointment of a Director of Racial Equity.
The report notes the resignation of the Bishop of Salisbury, the Rt Revd Stephen Lake, as deputy chair (News, 17 April). This, it says, “provides an appropriate point at which to reflect on the effectiveness of our governance and internal control arrangements to support our continued commitment to the highest standards of governance, and provide assurance that our arrangements remain proportionate and robust”.
The value of the Commissioners’ investment assets at 31 December 2025 stood at £11.6 billion. In recent years, some have warned that the size of the fund could serve as a deterrent to giving. Most recently, the Theos report on cathedrals (News, 18 May) suggested: “With the media’s focus on the Church’s £11 billion endowment, the public is likely to assume that cathedrals have easy access to this large sum.”