Fiscal Stewardship
Welcome
The Community Foundation of Southeastern Connecticut represents the vision of leaders of the community who in 1982, worked together to ensure that there were long term financial resources to keep our community flourishing. The responsibility for employing prudent investment strategies to protect and enhance those resources, rests with our Board of Trustees and professional staff working in tandem with the Investment Committee and the Audit Committee. How this all comes together and the results are detailed here.
How We Manage Funds
The Foundation's individual funds are pooled together and invested in a well-diversified portfolio, which includes large-, mid-, and small-cap US equities, international equities, private real estate, and fixed income security (bonds). All are managed by the Russell Investments which is headquartered in Tacoma, Washington. Russell Investments is not an asset manager in the typical sense. They utilize a unique investment style in that they research, hire and manage several different types of individual managers in each asset class. This manager-of-managers investment process seeks to provide consistent, above-average returns by combining premier managers with complementary return patterns. A "total return" investment philosophy is in place, which encourages an appropriate commitment to diverse asset classes. The Foundation seeks to achieve its "total return" from a blend of investment income and capital gains (appreication).
Funds are commingled for investment purposes and each fund shares proportionately in the investment earnings. Each component fund is maintained as a separate account internally and is reported on an individual basis to each fund holder at least annually.
www.russell.com
Investment Committee
The Investment Committee consists of Trustees and volunteers with extensive institutional investment experience and varied perspectives. They are responsible for implementing the Foundation's investment policy, recommending investment managers and monitoring investment performance.
The current members of the Investment Committee are:
| David Zuckerbraun, Esq. (Chair) The Washington Trust Company |
Brian Carey Carlin Contracting |
Robert Evans Vice President Fleet Bank(retired) |
| Jim English President Emeritus– Trinity College |
Marc Ginsberg Attorney |
Karen Horn Brock Capital |
Statement of Investment Policy
The Statement of Investment Policy is the guiding tool of the Foundation's Investment Committee for the management and oversight of its portfolio. As a community foundation we have the responsibility to manage endowed funds and invest them to provide support for the current needs of the eleven towns we serve. We must also preserve these charitable resources for use by future generations to address new and emerging needs. The most effective way to achieve these duel objectives is through prudent investment and a sound spending policy
One of the main objectives of the Foundation's Investment Policy is to "diversify investments within asset classes to reduce the impact of losses in single investments, and to provide returns that over the long term provides sufficient income and appreciation to fund the Foundation's spending policy".
The current policy was adopted when the Foundation switched to the Russell Investment Company in 2003 and includes broad diversification in such asset classes as Real Estate, Mid/Small Cap and International Equities. The policy establishes benchmarks for all the asset classes and asset ranges. Performance is monitored regularly and the portfolio is rebalanced monthly to keep it within established ranges.
The other major component of the policy is the Spending Rule which determines the Foundation's ability to annually award grants and scholarships. Currently the spending rule provides for a range of 4-6% of the three year rolling average of the funds' value. Using a rolling average helps soften swings in market performance and provides for more consistent and level grant making.
Investment Performance
Each fund shares proportionally in the investment earnings, and any return above the spendable amount remains in the fund to increase its value over time.
COMMUNITY FOUNDATION OF SOUTHEASTERN CONNECTICUT FIVE YEAR POOLED INVESTMENT PORTFOLIO PERFORMANCE |
||
ACTUAL PERFORMANCE |
COMPOSITE BENCHMARK |
|
| 2008 | -31.76% |
-28.59% |
| 2007 | 7.03% |
7.68% |
| 2006 | 14.46% |
13.42% |
| 2005 | 8.22% |
5.87% |
| 2004 | 10.49% |
11.02% |
| TOTAL RETURN | 8.44% |
9.40% |
| ANNUALIZED RETURN | 1.63% |
1.81% |
Regulatory Oversight
In 2002, Congress passed the Sarbanes-Oxley Act in response to the collapse of several major for profit companies in the United States due to fraud and mismanagement. Although these regulations are not required of non-profit organizations, the Community Foundation of Southeastern Connecticut has adopted several of them. In 2004 we formed an independent Audit Committee which meets three to four times each year to review our internal control systems and policies. The Board has also adopted an official Record Retention Policy which addresses the retention and destruction of business records. Each board, committee and staff member is required to sign a conflict of interest statement as well as a confidentiality statement. Our independent auditors, currently BlumShapiro of West Hartford, CT, appointed by the Audit Committee, conduct a yearly comprehensive audit of the Foundation and review it with the entire Board. View Audited Financials.
