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COMMITTEE CHARTER OF THE
BOARD OF TRUSTEES OF KETTERING UNIVERSITY

ADMINISTRATION AND FINANCE SUBCOMMITTEE ON INVESTMENT

 

Purpose

The purpose of the Administration and Finance Subcommittee on Investment is to maintain the prudent and effective investment of the endowment and to formulate and oversee the investment policies and management of the endowment. The Subcommittee is responsible for the investment, reinvestment and management of all long-term investment assets of the University, and for the appointment of independent investment advisors or managers authorized to invest and reinvest funds of the University. The Investment Subcommittee develops the University’s investment policy guidelines (including asset allocation strategy) for approval by the Administration and Finance Committee and the Board of Trustees and shall periodically review all investment results and report such results from time to time to the Administration and Finance Committee.

Organization

Review of Charter  

This charter shall be reviewed and reassessed by the Administration and Finance Subcommittee on Investment at least annually, and any proposed changes shall be submitted to the Board of Trustees for approval.

Membership/Structure/Quorum  

The Administration and Finance Subcommittee on Investment shall be composed of not less than three Trustees. The Vice President for Administration and Finance shall serve, ex officio, as a non-voting member of the Committee, and the President may appoint other non-voting members as required to properly exercise the duties of the Committee.  

A quorum of any meeting of the Administration and Finance Subcommittee on Investment shall consist of a majority of its voting members.

Staff Designee

The Vice President for Administration and Finance and/or his or her designee(s), shall be staff to the Subcommittee. 

Meetings 

Meetings shall be held in conjunction with regularly scheduled meetings of the Board, or as deemed necessary by the Chair of the Subcommittee.

Agenda, Minutes and Reports

The Chair of the Subcommittee, in collaboration with the Chair of the Administration and Finance Committee and the staff designee, shall be responsible for establishing the agendas for meetings of the Subcommittee. An agenda, together with relevant materials, shall be sent to the subcommittee members in advance of each meeting. Minutes for all meetings shall be prepared in draft form by the staff designee and reviewed by the Chair, and shall be approved by the subcommittee members at the following meeting. The minutes shall be distributed periodically to the full Board of Trustees through the Administration and Finance Committee. The Subcommittee shall make regular reports to the Administration and Finance Committee.

Authority and Responsibilities

The Subcommittee’s primary responsibilities are as follows:

  • Develop a comprehensive understanding of the relationship between the endowment’s support of the operating budget (e.g. spending rule) and the investment (e.g. asset allocation) policy;
  • Establish a Long-term Investment Guidelines Policy Statement for approval by the Administration and Finance Committee and the Board;
  • Consult with the Advancement Committee as needed to ascertain the need for overall endowment growth to support the University’s mission and assure that appropriate plans are in place to secure new additions to the endowment;
  • Oversee the adoption of appropriate risk management policies and procedures to manage, to the extent possible, market, liquidity, operational, credit, and other investment and asset management risks;
  • Assure compliance of endowment management with the Uniform Prudent Management of Institutional Funds Act as enacted in the State of Michigan;
  • Select investment managers, as appropriate, for managing investments using specific asset classes and strategies;
  • Review overall portfolio and manager specific performance, asset allocation, and portfolio expenses, and conduct ongoing manager due diligence;
  • Consult with the Audit Committee to ascertain that, to the extent possible, the custodian, brokerage and investment manager accounts of the endowment have been appropriately examined and reconciled;
  • If an investment consultant is engaged, review its performance at least every three years;
  • Review all investment management fees incurred by or on behalf of the University for reasonableness;
  • Work with the staff designee to ensure that internal reporting practices meet the committee’s needs and expectations; and
  • Conduct an annual self-evaluation of the performance of the Subcommittee, and the effectiveness and compliance with this charter.

The foregoing is a full, true and correct copy of the Charter passed and adopted by the Board of Trustees of Kettering University at a meeting thereof held on the 7th day of December 2012.


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