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Other Financial Polices: Outside Investment Managers

Other Financial Polices: Outside Investment Managers. Allison Peck Lankford, J.D. VP/General Counsel, Blue Grass Community Foundation alankford@bgcf.org / 859.225.3343. Let’s Put This In Context…. Let’s Put This In Context…. NO MINIMUM Outside Investment Manager Policy. Advantages.

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Other Financial Polices: Outside Investment Managers

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  1. Other Financial Polices: Outside Investment Managers Allison Peck Lankford, J.D. VP/General Counsel, Blue Grass Community Foundation alankford@bgcf.org / 859.225.3343

  2. Let’s Put This In Context…

  3. Let’s Put This In Context…

  4. NO MINIMUM Outside Investment Manager Policy

  5. Advantages • Relationship builder with professional advisors • Overall awareness and appreciation of services • Improved donor services • Diversification of investment philosophies consistent with IPS • Proactive solution rather than reactive

  6. Challenges Internal Administration Cash Flow Internal Controls Investment Committee Development vs. Finance

  7. Necessary Policies & Procedures Investment Policy Statement Qualified External Investment Advisor Policy Qualified External Investment Advisor Checklist Investment Committee Approval of Advisors

  8. Advisor Responsibilities • Adhering to IPS • Adhering to investment goal, strategy, and asset allocation model for which Advisor was approved by Committee • Monthly accounting statements • Immediately reporting material matters affected relationship with Foundation (regulatory action; legal action; changes in personnel; ownership of firm; fees, etc.)

  9. Engagement Process Criteria considered when deciding to engage an advisor recommended by donor(s): • Established Firm • Minimum Professional Qualifications • Private Benefit to the Donor • Asset Allocation and Portfolio Management • Documentation • Form ADV Part I • Most recent audited financial statements of advisor’s firm • Proof of Insurance as it relates to managmeent of Foundation’s assets

  10. Investment Strategy The donor, in consultation with the Investment Advisor, will have the choice of asset allocation options listed below. Once an allocation is chosen, the funds can only be moved to another allocation option semi-annually on January 1 and/or July 1. CONSERVATIVE (equity range 0-30%) • Asset Allocation: Risk Adverse Portfolio • Asset Allocation: Conservative Portfolio MODERATE (equity range 40-70%) • Asset Allocation: Moderate Portfolio • Asset Allocation: ESG (Environmental, Social, Governance) Moderate Portfolio LONG TERM (equity range 60-100%) • Asset Allocation: Long Term Portfolio • Asset Allocation: Equity Portfolio

  11. Outside Advisor Analysis THIS IS JUST ONE PART OF THE STORY - IT DOESN’T ACCOUT FOR GOODWILL AND IMPROVED IMAGE WITH DONORS AND ADVISORS.

  12. Questions?Brian Dineen, Vice President of Financebdineen@bgcf.orgAllison Lankford, Sr. VP & General Counselalankford@bgcf.org859.225.3343

  13. 499 East High Street ● Suite 112 ● Lexington, KY 40507 ● 859.225.3343 ● www.bgcf.org

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