Efficient organisation and governance, alongside investment expertise, are the basis for better investment decisions. We advise, accompany and relieve family foundations and charitable foundations that want to outsource some or all of their tasks. Some may lack the professional or time resources, others need an independent sparring partner. FINAD advises foundations comprehensively on seven topics:

1. Organisation and Governance

The more solid the foundation, the more sustainable the construction. That is why we invest a lot of time at the beginning in setting up the foundation’s organisation, its governance and its decision-making processes. For this, we analyse the situation and suggest organisational improvements. -Typically, we recommend one of these organisational forms:

  • One-stop shop: all investment decisions and the implementation of the investment policy are delegated to a major bank or a family office
  • In-house investment team: an investment team within the foundation takes responsibility for the investment policy and its implementation
  • Investment Committee: an independent investment advisor and asset manager assists the Foundation’s Investment Committee with investment decisions and implements them

In addition, we support foundations in creating or revising their investment regulations and guidelines and in bringing their investment structure in line with their investment strategy. We review and optimise strategic asset allocation and advise foundations on their SRI policy for sustainable investments.

2. Strategic Asset Allocation

The strategic asset allocation determines the long-term course and is based on the risk capacity and risk appetite, which depend on the objectives of the foundation. We propose an asset allocation or analyse the current weighting of asset classes as well as currencies and derive optimisation measures from this. For example, other weightings for asset classes and currencies or new asset classes such as green bonds for the financing of sustainable projects with a positive impact on the environment and/or the climate.

3. Tactical Investment Advice

Depending on the organisation, we support the investment committee or board of trustees in tactical investment issues, including overlay management for the control of risk and return or currency management. We also advise foundations that need an investment strategy for a specific asset class, such as private equity, or help them optimise their existing strategy. If desired, we organise (virtual) meetings of the investment committee, prepare presentations for the management or the supervisory board and share our financial expertise and market knowledge with the foundation’s board of trustees or investment committee.

4. SRI and ESG Strategy

More and more foundations want to invest in a socially responsible way. For this, they need an SRI and ESG strategy. We review their strategies, suggest improvements or develop a strategy with them in line with their goals and values. The individual ESG strategy excludes industries and companies with controversial business practices or production methods (negative screening) and invests in companies that are committed to the sustainable development goals of the UN (positive screening). Our direct investment or mutual fund strategies integrate ESG criteria without diluting profit opportunities. We work with specialized ESG data providers on the basis of which we make our stock and fund selections. – Find out more about socially responsible investments for foundations in the article “FINAD relieves the burden on charitable foundations” on finews.ch.

5. Selection of Asset Managers

The asset manager must fit the investment strategy. For one foundation a generalist is ideal, for another a specialist, for example in asset classes, sectors, regions or themes. This is how we proceed in our three-stage selection process for asset managers for direct mandates:

  • First, we send out a detailed questionnaire to all interested asset managers and conduct an in-depth interview with each candidate.
  • We then analyse all proposals qualitatively and quantitatively, aggregate the results and rank the best candidates for the mandate.
  • Finally, we personally present our three top candidates to the supervisory board or foundation board. The Foundation ultimately decides who will manage its assets.

We apply the top-down approach to fund selection. To do this, we take into account quantitative criteria such as size, success or fees and regularly define the strategy for each asset class.

6. Asset Management

In asset management, our focus is on direct investments. On the one hand, to save fees and costs, on the other hand, to be able to consistently implement the SRI and ESG strategy. Our investment principles have proven themselves and are successful: We …

  • … create added value for our foundations through active asset management. –
  • … we think long-term as we believe that a well-chosen asset allocation represents the main success factor in portfolio return and consciously ignore short-term fluctuations in financial markets. –
  • … base our decisions on in-depth fundamental analysis of the macro perspective, the relative valuation of asset classes as well as on our geopolitical assessments..
  • … focus on the growth of real assets and broadly diversify the investment risk of the overall portfolio.
  • … are cost-conscious, which is why we prefer direct investments and only use third-party products if they give us access to an asset class or a special investment approach.

7. Reporting and Controlling

Trust is good, overview is better. With our customised and transparent consolidated reports, foundations are always up to date. Our reporting provides a transparent overview over total assets, performance and risks, while controlling ensures compliance with asset allocation and investment guidelines. Thanks to this, foundations can monitor the performance, costs or execution of orders and, if necessary, talk or renegotiate with the asset manager. We also provide foundations with an encrypted data room where we can securely provide confidential information to the foundation board or investment committee.

An investment that pays off quickly

As an owner-managed family office, we have been the right partner for family foundations and charitable foundations since 1976. Three reasons that speak for a partnership with FINAD: You as a foundation board …

  • … take more informed investment decisions because we work with you to develop an efficient organisation, governance and investment structure for your foundation.
  • … assume your responsibility and can prove this to all stakeholders such as legal representatives or beneficial owners.
  • … avoid conflicts of interest because FINAD is economically independent and advises its clients independently of providers and products.

Of course, organisation, governance and investment structure have their price. In the beginning you invest time and money. But as soon as everything is set up properly, your initial investment will quickly pay off: With less work for the foundation board and with better results for the foundation.

«Family foundations or charitable foundations can purchase individual services or combine them all and only pay for what you need.»