Investment Policy Development for Nonprofits and Associations
Effective governance is critical for the success of your nonprofit’s investment program. At Raffa, we know the importance of crafting a policy that reflects your unique goals, preferences, and values while finding consensus from a potentially diverse set of stakeholders. Ongoing policy support and volunteer education is crucial.
INvestment policy
The Investment Policy Statement is the foundation from which all future investment decisions are made. An effective investment policy sets guidelines and restrictions for appropriate investment objectives. It helps to support consistency in an environment in which Board and committee members change. Raffa has helped hundreds of nonprofits develop and refine investment policies to reflect their unique goals, risk tolerance, and organizational values. Our process is straight-forward, collaborative, educational, and minimally invasive.
SPENDING policy
Spending policies outline when and how a nonprofit will use its invested funds for operational support, grantmaking, or other mission-aligned purposes. Creating a spending policy tailored to your needs and goals, with buy-in from volunteers and stakeholders, provides transparency, consistency, and a written framework guiding financial decisions. As a strategic advisor, Raffa will work with you to understand your spending goals, align those with your investments, and codify a spending plan that is tailored for you.
RESERVE policy
How much should you hold in reserve? How should those dollars be segmented by time horizon or objective? How was that decision made? Reserve policies provide critical context by answering those questions for staff and volunteers who routinely change. Raffa’s approach centers on identifying and quantifying the risks and opportunities facing your organization, understanding the likelihood those occur, and identifying how much to hold in reserve as a result. By engaging with both staff and volunteers, we aim to oversee a collaborative process that documents important context for future stakeholders.
Compliance Monitoring
Allowing your stakeholders to quickly and easily confirm that investments are compliant with your policies and performance is in line with expectations is critical. At Raffa, we customize reports based on your policies and financial sophistication to allow your volunteers to fulfill their fiduciary oversight responsibilities.
Values Based Investing
Looking to reflect your organization’s values in your investments but don’t know where to start? Raffa has deep experience helping organizations identify their values, codify those values in their investment policies, and bring those policies to life through customized investment solutions.
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Raffa's committment to Strong Nonprofit Investment Governance
Hundreds of Nonprofits Helped
Hundreds of Nonprofits helped
Ongoing Policy Support & Education
Ongoing Policy Support & Education
Tailored to your goals, risk tolerance & Values
Tailored to you
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FAQs
How does a well-designed Investment Policy Statement support Board and committee decision-making?
A well designed investment policy statement helps Boards and committee focus on oversight and strategic planning. It helps eliminate emotion from the investment decision making process and provides a clear structure under which to operate.
What role does Raffa play in updating or creating an investment policy statement?
Raffa works with the client to develop or review the investment policy statement. We have a detailed process that we go through with all clients to better understand the client’s ability and willingness to take risk with their cash assets. We take what we learn going through that process along with our knowledge of best practices for non profits to propose a new policy or recommend any tweaks to organizations that have an existing policy. The document is a foundational piece that provides the structure to manage an organization’s investment program so ensuring a thorough process is completed and that the document is customized for the client is paramount.
How often should we review or update our investment policy?
We recommend reviewing your investment policy every year or two to make sure it aligns with your investment goals, preferences, and risk tolerance. If there is significant Board turnover or a material change to your financial condition, make sure you revisit your policy so that it is reflective of your current operating position.
Can you help us get alignment across diverse board members?
Start with a clear process that involves all stakeholders. Begin with a financial assessment to establish a shared understanding of your organization’s position. Add key stakeholder interviews to capture priorities and perspectives, and use a high-level risk survey to uncover differences in risk tolerance. Document every step and the rationale behind decisions so future boards can see how and why decisions were made.
What does Raffa’s investment policy development process look like?
Raffa’s investment policy development process begins with a comprehensive review of your organization’s financial condition. We engage key staff and volunteers for interviews to better understand your business and investing goals & preferences. We facilitate a high level risk tolerance survey in an effort to gauge the willingness of the Board to endure market losses. We draft a memo outlining our recommendations providing reasoning and data to support our recommendations. Finally, we work with your volunteers to revise current policies or create new documents.
How do we reflect our values in our investment policy (ESG, SRI Investing)?
We help nonprofits translate their mission and values into a disciplined investment framework. Starting with a values-survey and board/committee consensus process, we integrate ESG criteria (environmental, social, governance) into portfolio structure and investment policy. Whether we recommend low-cost ESG funds or fully customized separately managed accounts, we align the portfolio with your organization’s purpose, risk tolerance and long-term goals. We educate your leadership on the trade-offs (such as short-term tracking error) and embed oversight processes so your investments reflect your values without surprising your stakeholders.
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