This Investment Policy Statement outlines the objectives, guidelines, performance expectations, and administrative expectations for the management of assets for the Society of California Archivists (SCA). These objectives have been established to provide the SCA Board of Directors with a meaningful framework for evaluating SCA’s portfolio management in order to meet their fiduciary responsibility to prudently monitor SCA’s investments. It is the intent of this Policy Statement to express general guidelines, attitudes and a philosophy aimed to guide members of the Finance and Investment Committee and other investment advisors. It is also intended that the policy be sufficiently specific to be meaningful, but flexible enough to be practical.
The following procedures will be followed to ensure the Investment Policy Statement is consistent with the current mission of SCA and adequately reflects the current financial condition of SCA. It is understood that this policy has been approved and adopted by the SCA Board of Directors.
The Finance and Investment Committee recognizes that the SCA Board of Directors maintains fiduciary responsibility for the organization, and that their own role is advisory in terms of investment strategy and policy. The Finance and Investment Committee responsibilities are outlined in the SCA Handbook, section 3-7.
The specific responsibilities of the Finance and Investment Committee in the investment process include and are limited to:
Investment objectives, risk levels, and general guidelines are described in this document. It is understood that the Board of Directors is responsible for the implementation of, and adherence to, the policies and objectives set forth in this document.
A. Measured Period: For purposes of measuring a rate of return over a market cycle, the measured period shall be between three and five years.
B. Fiduciary Standards: Investment of the long term portfolio shall be prudently diversified in terms of asset classes and broad market sectors. The Society’s assets are to be invested and managed in accordance with generally accepted standard of fiduciary responsibility. The safeguards which would guide a prudent investment manager are to be strictly observed. All transactions utilizing assets are to be undertaken for the sole benefit of SCA.
C. Volatility of Return: The goal of SCA’s long term investments is to produce returns that exceed inflation by 5% per year with an acceptable level of risk. The SCA Board of Directors understands that the current long-term portfolio asset allocation has a high probability of depreciating in any single year. Given that the overall portfolio has a long-term horizon, a prudent amount of short-term risk is acceptable to the SCA Board of Directors.
D. Permissible Investments: The Society’s assets may be invested only in publicly-traded common and preferred stocks, convertible bonds, and fixed-income securities, whether interest-bearing or purchased at discount, including money-market instruments, subject to any restrictions hereinafter specified. This investment can be in the form of direct investment in the stock market, or indirect investment via mutual funds. No other securities or instruments shall be presumed to be permissible investments without an amendment to this Policy.
E. Equity Portfolio Characteristics: The Society’s assets invested in equity securities shall, as a group:
F. Fixed Income Portfolio Characteristics: The Society’s assets invested in fixed income securities shall, as a group:
G. Foreign Securities: Investment in any securities whose issuer is a foreign corporation, government, or government entity shall be limited to no more than 10% of the total managed portfolio. Foreign equity investments shall include only those securities traded on principal U.S. stock exchanges.
H. Asset Diversification: The Society’s investments will maintain a reasonable diversification at all times. No more than 5% of the Society’s assets will be invested in a single company. No more than 15% of the entire portfolio may be invested in the securities of any one sector.
I. Investments and Transactions Which Are Not Permitted:
Investment Objective & Risk Profile: Current income with a defensive bias.
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Acknowledgment: The Finance and Investment Committee of the Society of California Archivists drew heavily from the 2015 draft of the Midwest Archives Conference Investment Policy Statement for this document.
Revision history: 01/2017 llc, 04/2019