Momentum Waikato is a community foundation with the following core purpose:
“To grow a perpetual fund to support projects of regional significance for intergenerational benefit”
It provides a vehicle for individuals, families, companies and groups to endow local community projects and causes of inter-generational significance. Donations and legacies given to the Foundation are invested in perpetuity with income being distributed to designated causes and organisations.
The donations and legacies form the “capital base” or “corpus”. Each year the corpus is adjusted by the general inflation rate to ensure that the capital base is maintained and preserved in real terms.
The Foundation expects to receive donations and legacies with specific management and distribution instructions. Specially “tagged” donations and bequests will be managed according to the specific wishes of the donor, where practicable managing these funds closely in accordance with the principles set out below.
All other funds will form a permanent and enduring part of the General Corpus, and will be managed strictly according to the principles set out below.
The primary objectives underlying investment decision-making by the Foundation are:
The focus of the Foundation will be to build the capital base to the point that the Foundation has sufficient scale to commence the making of distributions out of investment income on an enduring basis.
Once sufficient scale has been achieved, the Foundation envisages being in a position to make distributions each year equal to a minimum of 2.5% of the capital base at the start of the year.
The targeted level of distributions may be reviewed from time to time reflecting the growth of the endowment, the nature and extent of opportunities to deliver on the Foundation’s purpose, and changes in investment market conditions (e.g. should expected investment income increase or decrease markedly).
The Foundation’s investment risk profile will be set to prudently grow the capital base over the long-term.
The Trustees recognise that investment markets are prone to short-term volatility, which in turn can result in fluctuations in the capital base. To help ensure the capacity of the Foundation to consistently make annual distributions to deliver on its Purpose, the Trustees will seek to build a capital buffer and in the ordinary course will target making grants up to a maximum level equivalent to two-thirds of investment income. (It will not in the ordinary course make distributions out of the corpus itself).
Each year the Trustees will review the Foundation’s financial position:
The return – and acceptable volatility of return – targets of the Trustees are to achieve:
The assets will be invested based on the following long-term strategic asset allocation and will generally be maintained within the allowable ranges indicated:
In respect of the above strategy:
The investment guidelines and restrictions summarised below are in place for prudential reasons and apply to the General Corpus but not specially tagged bequests.
Departures from these require the unanimous written approval of the Trustees.
Investments must generally be confined to publicly listed, widely-held securities trading in recognised markets. Investments in NZ or Australian private equity funds may be permitted with the prior written consent of the Investment Advisory Committee.
The Foundation should not hold more than 2.0% of the equity of any one company and no individual holding should be over 5.0% of the value of the Foundation endowment.
The property assets will be confined to listed securities. Direct property investments may only be made with the unanimous consent of the Trustees.
Investments in companies in the liquor, gambling, tobacco, pornography, arms and ammunition sectors are considered incongruent with the purpose and values of the Foundation and are precluded.
The responsibility for the oversight of the Foundation’s investments and adherence with this investment policy rests with the Trustees. The Trustees have delegated oversight of day-to-day investment management to the Investment Committee.
Decisions to depart from this Investment Policy require the unanimous approval of the Trustees or, as part of their delegated authority, the Investment Committee.
External investment professionals (Investment Managers) have been appointed to oversee and undertake the day-to-day investment management of the Foundation’s investments.
Detailed investment mandates provide a clear delegated authority to invest funds, in a manner consistent with this policy, and include operating guidelines as well as the Investment Managers’ reporting requirements.
The overall performance of the Foundation’s investments and its Investment Managers will be evaluated on a regular basis, against the objectives set out in this Investment Policy and by reference to the returns available from cash assets and achieved in investment markets over the relevant evaluation period.
Download a copy of this statement here.