The Investment Governance Service
We do what trustees should do, but don't know how
The responsibilities of a trustee are the highest level known in law. Few trustees know what these duties are or have the professional training to fulfill them. The Investment Governance Service solves this problem.
We develop policies
Without clearly documented investment policies, it is impossible for a trustee to demonstrate that they have fulfilled their duties of care. Anodos creates a series of policies that the trustee adopts which serve as the roadmap for ongoing investment governance.
We execute procedures
Without procedures, it is impossible to judge whether the trustee's policies have been satisfied. Anodos conducts a series of quarterly procedures that correspond to each of the governance policies that the trustee has adopted.
We maintain a compliance library
Without a compliance library, there is no evidence that the governance procedures have been fulfilled. Anodos establishes a compliance calendar, maintains an online vault, and populates that library with records of the governance activities.
Duty re total return
A policy should be adopted that the total investment return for the portfolio will be reported quarterly. This return calculation shall be consistent with the performance guidelines developed by the CFA Institute--time weighted return net of fees.
Duty re prevailing factors
A policy should be adopted to take account of the prevailing economic and investment environments as the trustee administers the trust.
Duty re contingency plan
A policy should be adopted that, on an annual basis, an evaluation will be made of the ongoing distributions of the trust in the event of significant market turmoil.
Duty re diversification
A policy should be adopted that no individual security, industry sector or asset class will represent an unreasonably large portion of the portfolio unless specific circumstances justify otherwise.
Duty re liquidity
A policy should be adopted that defines the portion of the portfolio that may be allocated to illiquid and unmarketable securities.
Duty re "alternative" investments
A policy should be adopted that if the investment advisor uses illiquid investments in the portfolio, a memo for the compliance library should be created addressing conflicts of interest, expected return, investment term, and cost.
Duty re investment costs
A policy should be adopted that, on an annual basis, a fee study will be conducted to compare the investment advisor’s fee to competitive investment offerings for portfolios of comparable size, complexity and product mix.
Duty re conflicts of interest
A policy should be adopted that, on an annual basis, the investment advisor will be asked to provide a written disclosure of any conflicts of interest that may exist between the advisor, the trust and the investment products or processes that the advisor has adopted.
Duty re agent selection
A policy should be adopted that each year the advisor’s FINRA report and/or ADV will be reviewed to determine if they remain in good standing with the regulatory bodies that oversee their licensure.
Duty re delegation
A policy should be adopted that a “Delegation of Investment Duties” document will be written and provided to the investment advisor.
Duty re monitoring
A policy should be adopted that several benchmarks will be established and used as key performance indicators to measure whether the risk and return experienced by the portfolio are within a reasonable range of the expected outcomes.
Duty re contemporaneous review
A policy should be adopted that, on an annual basis, these governance policies will be reviewed and reaffirmed, with particular emphasis on policies that are timeless rather than those made in reaction to changing market conditions.
of Trust Corpus
This fee is paid by the trust rather than the trustee. The minimum is $3,600 per year (billed quarterly), and for trusts with value above $10m a reduced retainer is often proposed. In some rare cases the 0.10% fee may be increased based on the complexity of the case.
Not only does this firm understand the fiduciary duty issues thoroughly; they are enormously helpful in applying the standards of care to a particular situation. Perhaps most helpful is their willingness to accommodate our schedule. Overall a very positive experience and an excellent work product.
Esq. and Trustee
I had a nagging feeling that the investment manager the prior trustee was using wasn't very good, but I could never prove it. It was helpful to have Anodos do a thorough, independent review of the facts.
CPA and Trustee
My attorney didn’t know the answers to my questions. And the referral from my attorney didn’t know the answers. But the Anodos team had an intimate understanding of the investment, tax and governance issues I was facing as a trustee.
Schedule a free consultation
Wondering if our Investment Governance Service is right for you? Schedule a conversation to discuss your unique situation.