PURPOSE
The purpose of this Investment Policy is to provide a clear statement of the organization’s investment objective, to define the responsibilities of the Board of Directors, the CEO, and other parties involved in managing the organization’s investments, and to identify asset allocation guidelines and key criteria for decisions.
INVESTMENT ADVISOR
The organization does not currently require an investment advisor because of the amount of funds available for investment. The current policy is designed to carry minimal risk. An investment advisor may be considered in the future.
INVESTMENT OBJECTIVE
Confluence Philanthropy’s mission is to transform the practice of investing by aligning capital with our community’s values of sustainability, equity, and justice. Confluence recognizes that all investments have an impact. We believe that investors should not compromise what matters to them in exchange for financial return. By aligning capital in all its forms with our values, we can build an economy that is sustainable and that takes care of people and the planet, together.
In alignment with our mission, the investment objective of Confluence Philanthropy is to preserve capital for future organizational growth and to continue to build an organizational reserve in the event of unexpected circumstances or shortfalls. to the extent possible we seek to align our investments and other financial decisions with our values and, within the context of our mission, seek competitive financial returns.
The organization will maintain a sufficient reserve, per our reserve policy, in a cash account, short-term money market funds, or other vehicles with comparable liquidity.
Confluence Philanthropy is a tax-exempt organization as described in section 501(c)(3) of the Internal Revenue Code. This tax-exempt status should be taken into consideration when making investment decisions.
OVERSIGHT
GENERAL INVESTMENT GUIDELINES
The portfolio is to be invested with the objective of preserving Confluence funds while seeking values-alignment.
ASSET ALLOCATION, RESTRICTIONS AND PERFORMANCE
Bank Accounts
The organization will maintain working capital of at least two months but no more than $250,000 per institution in one federally insured bank account, preferably at an institution with values that align with those of Confluence.
A secondary account has been established to maintain funds in excess of the working capital account. Funds in excess of $250,000 per institution should be moved to another entity insured by CDARS.
Secondary Account
Funds in excess of two months of working capital amount may be placed in a short-term money market account if the cash flow analysis indicates that they will not be needed during the investment period.
Should the organization accumulate funds in excess of the equivalent of six months of operating expenses in its bank accounts, cash account, and money market fund, the organization may invest funds in a short-term bond account after consulting with the Investment Advisory Committee and after a careful review of the organization’s cash flow.
Asset Allocation |
Target |
Cash |
Equivalent to 2 months of operating expenses |
Money Market Saving Account |
Remainder |
Short term Fixed Income |
At the point that the funds available are greater than 6 months of operating expenses. The organization will consider placing funds in a short-term bond fund, Treasury Bills, or Certificates of Deposit. |
Conditions and Restrictions
Gifts of Securities
All gifts of marketable securities shall be liquidated upon receipt from a donor.
Performance
Since the organization’s funds are conservatively invested, investment performance is expected to be low. Performance shall be reviewed semi-annually and reported to the Finance Committee by the CEO on a net of fees basis.
IPS Review
The Board will review the portfolio and the Investment Policy Statement on an annual basis. Revisions to the Investment Policy Statement will be proposed by the Investment Committee.