§ 55-268.13. Standard of conduct in managing and investing institutional fund.
A. Subject to the intent of a donor expressed in a gift instrument, aninstitution, in managing and investing an institutional fund, shall considerthe charitable purposes of the institution and the purposes of theinstitutional fund.
B. In addition to complying with the duty of loyalty imposed by law otherthan this article, each person responsible for managing and investing aninstitutional fund shall manage and invest the fund in good faith and withthe care an ordinarily prudent person in a like position would exercise undersimilar circumstances.
C. In managing and investing an institutional fund, an institution:
1. May incur only costs that are appropriate and reasonable in relation tothe assets, the purposes of the institution, and the skills available to theinstitution; and
2. Shall make a reasonable effort to verify facts relevant to the managementand investment of the fund.
D. An institution may pool two or more institutional funds for purposes ofmanagement and investment.
E. Except as otherwise provided by a gift instrument, the following rulesapply:
1. In managing and investing an institutional fund, the following factors, ifrelevant, shall be considered:
a. General economic conditions;
b. The possible effect of inflation or deflation;
c. The expected tax consequences, if any, of investment decisions orstrategies;
d. The role that each investment or course of action plays within the overallinvestment portfolio of the fund;
e. The expected total return from income and the appreciation of investments;
f. Other resources of the institution;
g. The needs of the institution and the fund to make distributions and topreserve capital; and
h. An asset's special relationship or special value, if any, to thecharitable purposes of the institution.
2. Management and investment decisions about an individual asset shall bemade not in isolation but rather in the context of the institutional fund'sportfolio of investments as a whole and as a part of an overall investmentstrategy having risk and return objectives reasonably suited to the fund andto the institution.
3. Except as otherwise provided by law other than this article, aninstitution may invest in any kind of property or type of investmentconsistent with this section.
4. An institution shall diversify the investments of an institutional fundunless the institution reasonably determines that, because of specialcircumstances, the purposes of the fund are better served withoutdiversification.
5. Within a reasonable time after receiving property, an institution shallmake and carry out decisions concerning the retention or disposition of theproperty or to rebalance a portfolio, in order to bring the institutionalfund into compliance with the purposes, terms, and distribution requirementsof the institution as necessary to meet other circumstances of theinstitution and the requirements of this article.
6. A person that has special skills or expertise, or is selected in relianceupon the person's representation that the person has special skills orexpertise, has a duty to use those skills or that expertise in managing andinvesting institutional funds.
(1973, c. 167, §§ 55-268.4, 55-268.6; 2008, c. 184.)
§ 55-268.13. Standard of conduct in managing and investing institutional fund.
A. Subject to the intent of a donor expressed in a gift instrument, aninstitution, in managing and investing an institutional fund, shall considerthe charitable purposes of the institution and the purposes of theinstitutional fund.
B. In addition to complying with the duty of loyalty imposed by law otherthan this article, each person responsible for managing and investing aninstitutional fund shall manage and invest the fund in good faith and withthe care an ordinarily prudent person in a like position would exercise undersimilar circumstances.
C. In managing and investing an institutional fund, an institution:
1. May incur only costs that are appropriate and reasonable in relation tothe assets, the purposes of the institution, and the skills available to theinstitution; and
2. Shall make a reasonable effort to verify facts relevant to the managementand investment of the fund.
D. An institution may pool two or more institutional funds for purposes ofmanagement and investment.
E. Except as otherwise provided by a gift instrument, the following rulesapply:
1. In managing and investing an institutional fund, the following factors, ifrelevant, shall be considered:
a. General economic conditions;
b. The possible effect of inflation or deflation;
c. The expected tax consequences, if any, of investment decisions orstrategies;
d. The role that each investment or course of action plays within the overallinvestment portfolio of the fund;
e. The expected total return from income and the appreciation of investments;
f. Other resources of the institution;
g. The needs of the institution and the fund to make distributions and topreserve capital; and
h. An asset's special relationship or special value, if any, to thecharitable purposes of the institution.
2. Management and investment decisions about an individual asset shall bemade not in isolation but rather in the context of the institutional fund'sportfolio of investments as a whole and as a part of an overall investmentstrategy having risk and return objectives reasonably suited to the fund andto the institution.
3. Except as otherwise provided by law other than this article, aninstitution may invest in any kind of property or type of investmentconsistent with this section.
4. An institution shall diversify the investments of an institutional fundunless the institution reasonably determines that, because of specialcircumstances, the purposes of the fund are better served withoutdiversification.
5. Within a reasonable time after receiving property, an institution shallmake and carry out decisions concerning the retention or disposition of theproperty or to rebalance a portfolio, in order to bring the institutionalfund into compliance with the purposes, terms, and distribution requirementsof the institution as necessary to meet other circumstances of theinstitution and the requirements of this article.
6. A person that has special skills or expertise, or is selected in relianceupon the person's representation that the person has special skills orexpertise, has a duty to use those skills or that expertise in managing andinvesting institutional funds.
(1973, c. 167, §§ 55-268.4, 55-268.6; 2008, c. 184.)
§ 55-268.13. Standard of conduct in managing and investing institutional fund.
A. Subject to the intent of a donor expressed in a gift instrument, aninstitution, in managing and investing an institutional fund, shall considerthe charitable purposes of the institution and the purposes of theinstitutional fund.
B. In addition to complying with the duty of loyalty imposed by law otherthan this article, each person responsible for managing and investing aninstitutional fund shall manage and invest the fund in good faith and withthe care an ordinarily prudent person in a like position would exercise undersimilar circumstances.
C. In managing and investing an institutional fund, an institution:
1. May incur only costs that are appropriate and reasonable in relation tothe assets, the purposes of the institution, and the skills available to theinstitution; and
2. Shall make a reasonable effort to verify facts relevant to the managementand investment of the fund.
D. An institution may pool two or more institutional funds for purposes ofmanagement and investment.
E. Except as otherwise provided by a gift instrument, the following rulesapply:
1. In managing and investing an institutional fund, the following factors, ifrelevant, shall be considered:
a. General economic conditions;
b. The possible effect of inflation or deflation;
c. The expected tax consequences, if any, of investment decisions orstrategies;
d. The role that each investment or course of action plays within the overallinvestment portfolio of the fund;
e. The expected total return from income and the appreciation of investments;
f. Other resources of the institution;
g. The needs of the institution and the fund to make distributions and topreserve capital; and
h. An asset's special relationship or special value, if any, to thecharitable purposes of the institution.
2. Management and investment decisions about an individual asset shall bemade not in isolation but rather in the context of the institutional fund'sportfolio of investments as a whole and as a part of an overall investmentstrategy having risk and return objectives reasonably suited to the fund andto the institution.
3. Except as otherwise provided by law other than this article, aninstitution may invest in any kind of property or type of investmentconsistent with this section.
4. An institution shall diversify the investments of an institutional fundunless the institution reasonably determines that, because of specialcircumstances, the purposes of the fund are better served withoutdiversification.
5. Within a reasonable time after receiving property, an institution shallmake and carry out decisions concerning the retention or disposition of theproperty or to rebalance a portfolio, in order to bring the institutionalfund into compliance with the purposes, terms, and distribution requirementsof the institution as necessary to meet other circumstances of theinstitution and the requirements of this article.
6. A person that has special skills or expertise, or is selected in relianceupon the person's representation that the person has special skills orexpertise, has a duty to use those skills or that expertise in managing andinvesting institutional funds.
(1973, c. 167, §§ 55-268.4, 55-268.6; 2008, c. 184.)
