A guide to best practices for nonprofit fiduciaries
A guide to best practices for nonprofit fiduciaries
fulfilling
your mission
Table of contents
fiduciary
best practices
A guide to best practices for nonprofit fiduciaries
Page 3
Sample Investment Committee Charter
Page 42
Sample Investment Policy Statement
Page 46
Investment committee member matrix
Page 50
Nonprofit investment committee member checklist
Page 54
Common investment committee agenda topics
Page 58
Where investment committees spend their time
Page 62
Nonprofit investment committee checklist
Page 66
Committee assessment tool
Page 70
Sample conflict-ofinterest policy statement
Page 74
fiduciary
best practices
contents
Introduction
2
Part I: Defining your role
Defining the fiduciary role
6
A brief history of U.S. fiduciary law
Accounting standards and other criteria
Your fiduciary role
Laying a strong foundation
12
Investment committee charter
Investment policy statement
Investment purpose and strategy
Part II: Building your structure
Building out the framework
16
Portfolio construction
Risk management
Measuring success
Spending policy
Manager selection
Maintaining the structure
26
Meeting agendas
Conclusion
30
Part III: Glossary and references
Glossary of legal, accounting, and tax terms
32
References
35
1
introduction
The value of nonprofit service in today's society
Serving on the investment committee of a nonprofit or other charitable organization can be a rewarding way to serve your community and society. Nonprofits provide a large share of services critical to quality of life both domestically and internationally. They are on the front lines of some of the world's greatest challenges: providing food, medicine, and college scholarships for the underprivileged; protecting the environment; and eradicating diseases worldwide.
Figure 1. Challenges indicated by nonprofit leaders
Financial sustainability Financial sustainability is a top challenge
Yes No 62% 38%
Full-cost funding is a top challenge
57% 43%
Broke even or surplus in 2017
76% 24%
Demand for services
Changes in demand for NP services
Rising Not 86% 14%
Able to meet demand
Yes No 43% 57%
Planning to increase services
Yes No 63% 37%
Policy environment
Harder Same 58% 39%
Source: Nonprofit Finance Fund, State of the Nonprofit Sector Survey 2018.
Such service is not without its share of unique challenges, however. Chief among them is often the limited financial resources available to support your institution's mission. According to the most recent annual survey from the Nonprofit Finance Fund, 62% of the 3,400 organizations surveyed said financial sustainability is a top challenge (Figure 1).
To the extent that a nonprofit investment portfolio exists, it may not be large enough to attract and retain qualified staff to manage the daily operations of the investment portfolio. These difficulties underscore the importance of establishing strong financial principles and practices within the nonprofit community.
The investment decision-making group at nonprofits can range from a large, diverse investment committee to a finance committee, board, staff, or other decisionmaking entity. For the purposes of this reference manual, we will refer to any decision-making entity as the investment committee.
Reflecting the resource challenges of many charitable institutions, this reference manual offers investment committee members and their staffs valuable guidance on a number of functions vital to serving a nonprofit in an investment-oriented role, including:
? At the board level, the critical importance of a well-written, thoughtful investment committee charter that clearly defines roles and responsibilities so committees can function efficiently.
2
................
................
In order to avoid copyright disputes, this page is only a partial summary.
To fulfill the demand for quickly locating and searching documents.
It is intelligent file search solution for home and business.
Related searches
- financial best practices for nonprofits
- best practices for email communication
- salesforce best practices for sales
- best practices for nonprofit organizations
- best practices for finance departments
- best practices for teachers
- best practices for accountability
- best practices for reporting
- best practices for charitable foundations
- best practices for nonprofit
- best practices for relationship management
- best practices for email campaigns