The Unitarian Universalist Common Endowment Fund (“UUCEF”) is an alternative for UU Congregations that currently manage or direct the investment of their own assets. The Fund is more than a single investment option – it is an investment program that implements a range of key tasks that may be challenging (and costly) for any single UU Congregation to perform on its own. Under oversight of the Board, the Investment Committee selects professional outside advisors and Investment Managers.
The UUCEF provides a vehicle for sophisticated investment management and the resulting above median performance that is consistent with our UU socially responsible investment beliefs. Additionally, the UUCEF can protect participating Investment/Finance Committees of local UU congregations from the fiduciary risks to which they (possibly unknowingly) expose themselves. The Committee has documented processes and works with outside legal, audit, investment consultant, investment manager, socially responsible investment, custody, and back office experts. In addition, the UUA Finance staff has a high degree of experience and expertise, along with that of our committee members.
Money transferred to the Fund may be sent to the Fund office at any time; however, those funds will not be invested in the Fund until the beginning of the next calendar month. In order to be invested in the Fund in a timely manner, new contributions must be received by the Fund by a monthly “Valuation Date”, which is the last business day of each month. It is recommended that new contributions to the Fund be received by the UUA at least 3 business days prior to the Valuation Date.
To invest in the Fund, a UU Congregation must complete and submit an agreement to invest in the Fund (“Subscription Agreement”) and send the Subscription Agreement either before or accompanied by an initial deposit to the UUA. Once received and approved, the UUA will confirm the UU Congregation’s starting date as an investor.
The Fund seeks to achieve consistent returns within a moderate risk tolerance over the long term, sufficient to allow Congregations take regular distributions and maintain the value of principal after adjustment for inflation and after all expenses. These objectives are consistent with the needs of many UU Congregations, which typically draw 4.5% to 5% of their investment balance each year to support their activities.
The UUA seeks to achieve the highest possible professional standards in the way it manages and operates the UU Common Endowment Fund, and by so doing, provide stable investment performance at a reasonable level of risk, while having a positive impact on social and environmental issues.
The Investment Committee (“IC”) is appointed by the UUA Board of Trustees, and operates under the Investment Policy adopted by the Board. The Investment Policy authorizes the IC to interpret and implement the Investment Policy, establish IC Guidelines (including the investment objectives above), and report regularly to the board. The IC establishes the asset allocation policy that sets target commitments for each asset class. The IC is also responsible for setting guidelines for rebalancing asset classes and reviewing them on at least a quarterly basis.
When managing their own endowments, individual UU Congregations face an increasingly complex set of challenges. UU Congregations may not have the time and expertise to manage the regulatory and market risks necessary to generate the investment returns they seek. By investing in the Fund, UU Congregations can transfer the responsibilities of investment management to a team of UUA committee members, staff and outside professional managers and advisors and take advantage of a comprehensive approach already in place — one with investment practices that express and support UU values through socially responsible investing.