Removal of an Investment Manager
There may be circumstances which provide the College reason to consider the removal of an investment manager. Following are the general guidelines which may give reason to remove an investment manager:
- Failure to follow this Statement of Investment Policy after written notification from the College to the investment manager identifying the violation with a specific time frame to comply with policy.
- Failure to meet any of the investment return benchmarks, as established by the investment consultant and the College.
- Failure to comply with investment restrictions as defined for the manager by the College.
- Significant qualitative changes to the investment management organization.
Each investment manager shall be reviewed at a minimum annually regarding performance, personnel, strategy, research capabilities, organizational and business matters, and other qualitative factors that may impact its ability to achieve the desired investment results.
If the investment manager has consistently failed to adhere to one or more of the above conditions, it is reasonable to presume a lack of adherence going forward. Failure to remedy the circumstances of unsatisfactory performance by the investment manager, within a reasonable time, shall be grounds for removal.
Any recommendation to remove an investment manager will be treated on an individual basis, and will not be made solely based on quantitative data. In addition to those above, other factors may include professional or client turnover, or material change to investment processes. Considerable judgment must be exercised in the removal decision process.
A manager shall be removed using one of the following approaches:
- Remove and replace with an alternative manager.
- Freeze the assets managed by the removed manager and direct new assets to a replacement manager.
- Phase out the manager over a specific time period.
- Continue the manager but add a competing manager.
- Remove the manager and do not provide a replacement manager.