SaultAreaHospitalFoundation
TITLE: INVESTMENT POLICY / NUMBER: I-80S:\SAHFOUND\Policies\FOUNDATION MASTER POLICIES\Policy I-80 Investment Policy.docPage 1 of 8
Section 1
Introduction:
This investment policy governs the manner in which Foundation funds are to be invested. The intention of the policy is to guide investment strategies and purchase decisions as approved by the Foundation Board, and to provide the Investment Committee with a process that reasonably ensures an appropriate return on investment, while minimizing the risk inherent in all investments.
Until there is an Investment Committee established, the Finance Committee shall serve as the Investment Committee.
Funds to be invested by the Foundation include all of the funds of the Foundation. The primary investment objectives of the Foundation shall be:
a.to preserve capital;
b.to support the grants program (with other sources of funding) and to comply with the required disbursement quota as determined by Revenue Canada with certain exceptions as recorded; and
c.to allow for the distribution of endowment funds at the decided upon rate as directed by the Board.
Section 2
Responsibilities of the Investment Committee:
The Investment Committee will:
a.recommend the appropriate investment philosophy, investment objectives and policy statement;
b.recommend the selection of Fund Investment Managers and a performance measurement service;
c.advise the Fund Investment Managers of the criteria listed above;
d.monitor the performance of the Fund Investment Managers, including reviewing the periodic presentations of the managers in the context of the agreed upon investment performance mandates;
e.review and approve, where appropriate, the criteria and the processes for hiring and terminating Fund Managers;
f.review and approve the Custodian and Guardian for the Fund Managers;
- review and approve the investment performance mandates for the Fund Managers;
- review Asset Mix as deemed necessary; and
- report to the Finance Committee of the Foundation Board of Directors, and make whatever recommendations it deems necessary or advisable.
The Investment Committee shall monitor the performance of the investment managers in managing the funds.
Section 3
Asset Allocation:
Allocation of assets is to be maintained in cash, fixed income and equities. Equities will at no time be in excess of eighty percent (80%) of the total portfolio.
Determination of asset allocation between foreign and domestic investments is at the discretion of the Investment Committee or its Appointed Agents.
The Investment Committee is directed to re-examine this allocation policy periodically, in light of significant changes in any of the following:
- long term capital market prospects;
b.the Foundation’s risk tolerance; or
c.any other factors considered relevant by the Investment Committee.
Section 4
Direction of Investment Managers:
Investment Managers will manage the assets of the Fund, subject to the general guidelines presented in the policy statement and any other amendments that may be made from time to time in writing by the Committee.
Investment Managers will report to the Committee on a periodic basis as requested by the Committee. The meetings will allow Managers to report on performance, and to advise the Committee on the investment strategy that is being followed and proposed.
An Investment Manager will provide written quarterly reports on the firm’s investment outlook and highlight its value-oriented purchase and sale objectives in relation to its outlook.
Section 5
Eligiable Asset Classes:
Investments may be made in any of the following asset classes:
1.Canadian common stocks, warrants or rights, limited to those listed on recognized North American stock exchanges, and debt convertible to equity
2.Indexed Funds
3.Non-Canadian common stocks, American Deposit Receipts, warrants or rights, including those of US Corporations or Non US Corporations listed on recognized stock exchanges
4.Debt securities of Canadian issuers, including those denominated in non-Canadian currencies
5.Debt securities of non-Canadian issuers, including those of U.S. issuers and those of non-U.S. issuers
6. Real Estate
7. Deposits with Banks
8.Bonds and debentures rated Single “A” or higher from Dominion Bond Rating Service or Canada Bond Rating Service
9.Fixed income products, Treasury bills, Bankers Acceptance and Deposit Receipts, Guaranteed Investment Certificates (Canadian or US)
Investment Managers will not engage in the following unless permitted in writing by the Committee:
a.purchase securities on margin;
b.loans to individuals;
c.short sales; or
d.speculative investments.
Investments may be made in the asset classes as defined above either directly, or by holding units of pooled, segregated or mutual funds investing in approved asset classes.
Section 6
Voting Rights:
Voting rights acquired through any investment shall be exercised by a Fund Investment Manager in support of the corporation’s recommendations. Any variation from such corporation’s recommendations, will require approval by the Investment Committee.
A Fund Investment Manager must notify the Chair of the Investment Committee if he/she or any officer in his/her firm has any direct or indirect pecuniary interest in any matter that a Fund Investment Manager has the right to vote on. The Chair of the Investment Committee has the discretion to:
1.instruct a Fund Investment Manager to exercise the voting right in line with the principles described above, on the grounds that the relevant pecuniary interest is not material; or
2.instruct a Fund Investment Manager how to cast the Fund’s vote, having considered the principles described above; or
3.authorize the Fund’s Custodian to exercise the voting rights in line with the principles above.
Section 7
Conflict of Interest Policy and Disclosure Requirements:
Individuals governed by guidelines:
a.any member of the Investment Committee;
b.the Fund Managers;
c.the Custodian;
d.the Fund Performance Measurement Services; and
e.any Director or Employee of the Foundation or agent of any of the above retained to provide services to the Foundation.
Conflict of Interest:
Any person listed above must disclose any direct or indirect association or material interest or involvement in aspects related to his/her role with regard to the fund investments that would result in any actual or perceived conflict of interest.
Actual or perceived conflict of interest may arise when a person has or acquires material pecuniary interest, direct or indirect, in a fund investment or proposed investment, or when a person may materially benefit from knowledge of, participation in, or by virtue of, a fund investment or investment decision.
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Section 8
Review Procedures:
The Investment Committee shall review Investment Policies and Objectives no less frequently than annually. The Committee will make whatever recommendations it considers advisable to the Board with respect to its confirmation or amendment.
The Investment Committee shall establish criteria for measuring and reviewing the performance of the Fund and of each Fund Investment Manager, with a view to monitoring progress towards the relevant investment objectives.
Any Fund Asset that is not capable of being traded frequently shall have its market value appraised internally at intervals not exceeding one year, provided that:
1.the principles underlying such reappraisals are consistent with the underlying principles of an external appraised value; and
2.any such re-appraisal resulting in a value different by at least ten percent (10%) from the last appraisal value shall be confirmed by an external appraiser.
In addition, such asset that has an appraised value of at least five percent (5%) of the market value of the Fund shall have its market value appraised by a qualified independent agent at intervals not exceeding three years.
APPROVED BY: SaultAreaHospitalFoundationAPPROVAL/REVISION DATES: September 22, 1992/September 19, 1995 REV./
January 25, 2000 REV
DISTRIBUTION:
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