Page 37 - October 2023

BOARD OF DIRECTORS’ MEETING MINUTES (DRAFT) (4) E. Investment Committee
Dick reported that the Committee had met in person in Boston in June and virtually in August.
The June meeting included an in-person meeting with leadership from Adage Capital Partners. This private equity fund holds over 20% of the JSF investments. One member asked if this is an unusually large percentage. The response was that this is one of the reasons the Committee wanted to meet with Adage. The Committee also noted that Adage has consistently outperformed the Market over a long period of time, which is unusual. Adage’s investment style is similar to a mutual fund in that it owns all sectors in proportion to their respective weighting in the market. This gives the foundation exposure to the broad market and reduces both risk and volatility. Adage is closed to new capital and if the Foundation withdraws money from Adage it cannot put it back later. Prime Buchholz knows Adage well and has opined that the Foundation’s current investment is appropriate and will continue to monitor it.
The Committee noted that Prime Buchholz has complete discretion in investing the Foundation’s private equity and venture capital allocations. However, these are long term partnerships and Prime Buchholz inherited many of them from Cambridge Associates. It will be a few years yet before we can clearly see how well Prime Buchholz has done with the Foundation’s private capital.
2022 was a down year in the markets. Thus far, the Foundation’s investment return has been positive in 2023.
F. Financial matters
Tommy echoed Dick’s report of positive returns to date. The 5 year financial report is cumulatively pretty positive.
The standard monthly statements (which go out in the Monthly Reports to the Directors) are prepared by Tommy and then reviewed prior to publication by Dick, Buzz, Bobby and Hugh. The expenditures budget is also tracking well. As is traditionally true, a large amount of grants went out in August and will also be heavy in November and December. Tommy reminded the Board that travel expenses are heavy in the last 4 months of the year.
The Foundation’s efficiency ratio compared to other FFOG foundations was noted as being very good, although it was noted that these are 2021 numbers. Tommy said that he expects to have the 2022 numbers in November. It was also noted that because of the difference in the way that foundations do business, particularly grantmaking process, this number is not as important as it might look. However, it is one of many indicators of efficiency.
G. Grant Program Committee meeting reflections
There was agreement that it had been a good meeting with lots of give and take. Sherry was particularly pleased with the time allotment for the presenters. Malcolm noted that the presenters were stellar and well prepared.
Angelique said she had enjoyed the Abilene Paradox discussion and how that carried through the discussions with and about the potential grantees.
Mike felt that we are finding great partners. He especially likes the mentoring component that is being expressed. Maybe JSF should consider trying to convene (via Zoom) grantees with similar programs so that they can share with and learn from each other.
Consensus was that the George Washington University matter was handled in a very professional way. It was especially meaningful that they were offered the opportunity to express which option they recommended.
Directors were unanimous in their expression that having this time in the Board meeting agenda was helpful.
H. Ratification of all Committee actions
The Board unanimously ratified all Committee actions taken since March 21, 2023.
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