Consistent with Silicon Valley Community Foundation's values of public accountability, transparency and integrity, we are pleased to share this investment governance news.
SVCF is in the process of shifting our investment advisory relationship with Colonial Consulting from non-discretionary to discretionary, which would give Colonial more discretion over hiring and firing investment managers. Effective July 1, 2017, the board delegated authority to Colonial to hire and fire managers of liquid strategies such as public equities and fixed income. During 2018, the investment committee and Colonial will evaluate how to best accomplish this for less liquid strategies such as private equity and real estate.
As SVCF’s assets and investment activity have grown, so has the need to revisit and align the governance structure to ensure that decision making is efficient, responsibilities are clear, and processes are consistent with the size, priorities and future expected growth of the community foundation. SVCF and Colonial would characterize this as a shift to a discretionary relationship, not a fully-outsourced relationship that some would characterize as “OCIO” or an “outsourced chief investment officer” relationship.
Does this change what Colonial currently does for the community foundation?
This will not change what Colonial does for the community foundation. Colonial will continue to source and evaluate managers on our behalf, and they will continue to inform the investment committee of managers in due diligence and incorporate committee input on the ever-evolving opportunity set. The investment committee remains responsible for setting policy and overseeing its execution. This includes establishing a strategic asset allocation for each pool and investment guidelines for each asset class. But now, with staff’s consent, managers may be hired or terminated without prior investment committee approval. SVCF will continue to sign manager agreements, open and close accounts, and administer transactions through our custodian.
How long has Colonial been SVCF’s investment consultant?
Colonial has been our consultant since SVCF’s inception in 2007, and was the consultant for one of our parent entities prior to that from 2005. We have a long and valued partnership with Colonial. This evolution in the governance structure is a natural extension of that relationship.
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