Tidwell Idaho Foundation Investment Policy Statement
Statement of Fiduciary Responsibility
We recognize that our fiduciary responsibility requires that we maximize the philanthropic impact of both our charitable grants and our investments, while minimizing risk.
We recognize that our fiduciary responsibility requires that we maximize the philanthropic impact of both our charitable grants and our investments, while minimizing risk.
Investment Goals
In general, the Tidwell Idaho Foundation (Foundation) seeks to invest and to generate income and capital gains necessary to support its overall charitable mission. Toward these ends, the Foundation is allowed to:
1) Make investments
2) Make program related investments; which provide capital directly to or own the equity or debt of enterprises that primarily further the Foundation’s mission, but are not expected to achieve market-rate financial returns
3) Make mission related investments which could provide a substantial contribution to mission, but which may provide market-rate, higher than market rate, or lower-than-market-rate returns
In general, the Tidwell Idaho Foundation (Foundation) seeks to invest and to generate income and capital gains necessary to support its overall charitable mission. Toward these ends, the Foundation is allowed to:
1) Make investments
2) Make program related investments; which provide capital directly to or own the equity or debt of enterprises that primarily further the Foundation’s mission, but are not expected to achieve market-rate financial returns
3) Make mission related investments which could provide a substantial contribution to mission, but which may provide market-rate, higher than market rate, or lower-than-market-rate returns
The Foundation will work towards a goal that at least 50% of the Foundation’s assets will be invested in mission-related ways.
Spending Policy
Each year the board of the Foundation will set a target amount for grants to be made during the ensuing year. Grantmaking and spending levels will be based on an assessment of current need, current and projected investment returns, and IRS minimum spending requirements, currently at least 5% of the five previous years’ rolling average of the value of the Foundation’s net assets. PRIs may constitute part or all of the 5% payout.
Each year the board of the Foundation will set a target amount for grants to be made during the ensuing year. Grantmaking and spending levels will be based on an assessment of current need, current and projected investment returns, and IRS minimum spending requirements, currently at least 5% of the five previous years’ rolling average of the value of the Foundation’s net assets. PRIs may constitute part or all of the 5% payout.
Return Goals and Acceptable Risk Level
The Board believes that a well-diversified portfolio should meet the Foundation’s primary financial return objectives over the long term, at an acceptable level of overall risk. The Foundation will utilize a total return approach in pursuing the objectives; financial return is expected to be achieved through both capital appreciation and current income. In order to achieve the primary financial return, objective, the Board is comfortable with a risk level of the portfolio that allows a level of volatility of a similarly aggressively allocated portfolio. Risk includes both the risk of not attaining the primary return objective over several years, as well as the risk of loss of capital. Return can also be measured by achievement of mission goals. Mission investments do not have to deliver market rate financial returns to be successful.
The Board believes that a well-diversified portfolio should meet the Foundation’s primary financial return objectives over the long term, at an acceptable level of overall risk. The Foundation will utilize a total return approach in pursuing the objectives; financial return is expected to be achieved through both capital appreciation and current income. In order to achieve the primary financial return, objective, the Board is comfortable with a risk level of the portfolio that allows a level of volatility of a similarly aggressively allocated portfolio. Risk includes both the risk of not attaining the primary return objective over several years, as well as the risk of loss of capital. Return can also be measured by achievement of mission goals. Mission investments do not have to deliver market rate financial returns to be successful.
The Foundation will meet cash flow needs using either income or principal or both. It is anticipated that the original founder of the Foundation will continue to contribute funds to the Foundation for the foreseeable future, so additional funds each year will also be available to meet cash grantmaking needs.
Asset Allocation
At the time of this annual donation by Founder, and no less than annually, the Board will review the asset allocation of the Foundation’s portfolio, performance of each asset, costs and fees associated with each investment, and will consider rebalancing the funds to conform with the asset allocation. At this time the board will also consider adjusting the asset allocation.
At the time of this annual donation by Founder, and no less than annually, the Board will review the asset allocation of the Foundation’s portfolio, performance of each asset, costs and fees associated with each investment, and will consider rebalancing the funds to conform with the asset allocation. At this time the board will also consider adjusting the asset allocation.
Duty of Care
The Board will have a duty to minimize costs and a duty of care to investigate investment opportunities and current investments. The Board has a duty of loyalty to invest the Foundation’s assets without personal gain or conflict of interest. If a board member has specialized skills, he or she is required to utilize them to benefit the Foundation. Board members will use the standards of good governance to review financial managers’ reports, to understand where the Foundation’s assets are invested, how well they are being managed, the role each investment plays in the overall portfolio, the expected total return of an investment, and an asset’s special relationship or value to the charitable purpose. The Board will be knowledgeable of what would constitute a jeopardizing investment under IRS guidelines and avoid investing in such an investment. If the board becomes aware of a jeopardizing investment, it will take immediate steps to divest the Foundation of that investment. The Board will be educated and updated periodically about current regulation and best practices.
The Board will have a duty to minimize costs and a duty of care to investigate investment opportunities and current investments. The Board has a duty of loyalty to invest the Foundation’s assets without personal gain or conflict of interest. If a board member has specialized skills, he or she is required to utilize them to benefit the Foundation. Board members will use the standards of good governance to review financial managers’ reports, to understand where the Foundation’s assets are invested, how well they are being managed, the role each investment plays in the overall portfolio, the expected total return of an investment, and an asset’s special relationship or value to the charitable purpose. The Board will be knowledgeable of what would constitute a jeopardizing investment under IRS guidelines and avoid investing in such an investment. If the board becomes aware of a jeopardizing investment, it will take immediate steps to divest the Foundation of that investment. The Board will be educated and updated periodically about current regulation and best practices.
