Investment Policy Template for your Nonprofit Organization

Free Download: Investment Policy Template

The Investment Policy establishes a blueprint for the prudent management and allocation of the organization's reserves or endowment funds. It is constructed with a dual focus: maximizing returns on investments while upholding the organization's mission, ethos, and long-term fiscal aspirations. Central to this is the optimization of returns, capital preservation, and maintaining investments that echo the core values and objectives of the organization.

The policy categorically delineates the fundamental tenets of the investment strategy. It emphasizes the safeguarding of capital, ensuring liquidity to cater to immediate financial needs, achieving meaningful returns, and astutely managing risks. Decision-making powers regarding investments are vested in a qualified and experienced governing body or a specialized committee. This body is also responsible for determining the organization's appetite for risk, taking into account several factors including the organization's fiscal position and its capability to absorb market volatilities. A cornerstone of the policy is the principle of diversification, advocating for a balanced investment portfolio across varied asset classes to navigate risks and enhance returns. Rigorous due diligence underpins the selection of investments, potentially augmented by expert external advisors. Reflecting modern ethical investment practices, the policy leaves room for socially responsible investing, integrating environmental, social, and governance (ESG) principles in alignment with the organization's mission. To ensure transparency and accountability, the policy mandates routine monitoring of the investment portfolio, punctuated by comprehensive reports detailing performance, risks, and compliance. Periodic reviews of this policy ensure its contemporariness, adjusting to the evolving financial landscape and the organization's shifting priorities.