The investment philosophy of The Methodist Foundation for Arkansas is incorporated into its Investment Policy, a governing document approved by the Board of Directors. Within the boundaries of that policy, the Financial Administrative Committee is authorized to act on behalf of the Foundation.
There are certain guiding principles by which the Investment Committee operates. These principles are referenced again and again in committee deliberations as it tries to make responsible investment decisions while being good stewards of the funds entrusted to the Foundation.
These principles include:
- The Foundation’s investment horizon is extremely long. A large part of the funds invested are from endowment funds, with governing documents that prevent use of the funds’ principal. This requirement dictates a very long view.
- The Foundation is an investor, not a trader. The committee does not believe that it can consistently outguess market fluctuations.
- As a fiduciary, the Foundation’s decision-making process and risk tolerance are substantially different from those of an individual investor. Our responsibilities dictate a conservative approach.
- Investment return is always a function of risk.
- Diversification and allocation are fundamental and essential components of the investment strategy.
- The Foundation’s investment policy includes a requirement that it comply with the investment guidelines of The United Methodist Church’s Social Principles.
- The Foundation maintains an investment management process that allows for customized asset allocations at the individual account level. The Foundation makes recommendations based on the counsel of our professional consultants, but we do not dictate a “one-size-fits-all” allocation for all Foundation clients.
