Course Description

Module Coverage

1. Investment Policies and Strategies 

i. Importance of an Investment Policy Statement (IPS)

• Defining the objectives and constraints of a charity’s investment strategy.
• Setting return expectations and risk tolerance.

ii. Governance and Oversight

• Board vs. management responsibilities in investment decisions.
• Establishing an investment committee and selecting external fund managers.
• Mitigating conflicts of interest and instilling arms-length principles in investment decisions.
• Profit return procedures and termination clauses.

iii. Investment Strategies for Non-Profits

• Capital preservation vs. growth strategies.
• Time horizon considerations: short-term liquidity vs. long-term endowment funds.

2. Asset Management and Diversification 

i. Types of Investment Vehicles

• Fixed income (bonds, treasury bills).
• Equities (stocks, ETFs).
• Alternative investments (real estate, private equity, impact investing).

ii. Asset Allocation and Diversification

• Strategic vs. tactical asset allocation.
• Risk-adjusted return considerations for charities.

iii. Managing Endowment and Reserve Funds

• Differentiating between restricted and unrestricted funds.
• Withdrawal policies for sustainability.

3. Risk Management and Hedging 

i. Investment Risks and Their Impact on Charities

• Market risk, credit risk, liquidity risk, inflation risk.
• Managing volatility through asset class selection.

ii. Hedging Strategies for Risk Reduction

• Using derivatives (options, futures) cautiously.
• Hedging currency risk for global investments.

iii. Risk Monitoring and Reporting

• Establishing key performance indicators (KPIs) for investment oversight.
• Regular review and rebalancing strategies.

4. Responsible Investing & Reporting 

i. Principles of ESG (Environmental, Social, Governance) Investing

• Aligning investments and revenue generating activities with a charity’s mission and ethical considerations. 
• Avoiding reputational risks from unethical investments.

ii. Implementing Sustainable Investment Policies

• Screening and integrating ESG factors into the portfolio.
• Impact investing and mission-aligned investing.

iii. Transparent Reporting to Stakeholders

• Disclosing investment decisions and performance.
• Reporting in compliance with the Code of Governance for Charities and IPCs.