A Message from the ELCA Foundation
The ELCA Foundation Addresses Recent Economic Concerns - October 1, 2008
The ELCA Foundation’s (Foundation) purpose is to generate transformational gifts for ministry and manage endowment assets entrusted to it by congregations, synods, and other organizations of this church. The Foundation is committed to ensure that assets are managed in a way that supports our purpose. Current market conditions and recent financial developments are of concern to our donors and participants, so we take this opportunity to communicate our perspectives on current events.
The Foundation administers several long-term investment portfolios, including:
- Endowments and Institutional Investments
- Charitable Gift Annuities
- Charitable Trusts
Endowments
The Foundation administers over $339 million in endowment assets through the Endowment Fund Pooled Trust – Fund A (Fund A). The ELCA Board of Pensions (BOP) has served as the investment advisor for these endowments for over twenty years. Together with the BOP, the Foundation adheres to long-term investment strategies focused on socially responsible investing that produces a steady stream of distributable income while maintaining the inflation-adjusted purchasing power of the corpus. Risk is managed by ensuring that investments are well diversified across and within asset classes. We believe that our established investment management relationships and sound investment strategies will successfully guide Fund A through the current financial market conditions.
Charitable Gift Annuities
The Foundation and its predecessors have administered a charitable gift annuity program for over 80 years. The charitable gift annuity pool is invested primarily through BOP, and has always maintained a position of strong liquidity while meeting payment obligations to annuitants. Charitable gift annuity agreements are backed by the full faith and credit of the ELCA, and annuity payments are not contingent upon market performance.
Charitable Trusts
The Foundation administers approximately $80 million in charitable trust assets. Charitable trust assets are managed primarily through Wachovia Trust. As a fiduciary, the Foundation acknowledges concern regarding these funds. Although there are continuing developments regarding the sale of certain Wachovia businesses, we do not currently anticipate disruptions in trust investment and administrative services. Each charitable trust is held ‘in trust’, and trust assets are not commingled with general assets of Wachovia Corporation. Since trust assets remain under the ownership of the ELCA, they are not subject to potential claims against Wachovia.
On behalf of donors and beneficiaries, the Foundation monitors trust activity with the trust advisors regularly during good times and difficult times. We continue to monitor developments with our colleagues at Wachovia, BOP, and other investment managers, and we will provide additional information as it becomes available.
While we cannot control the financial markets or volatility, we continue to adhere to our long-term investment strategies. Gifts and investments entrusted to us are vital for ministry, and the Foundation remains steadfast in our commitment to serve this church. For questions or concerns, please call the Foundation at 800/638-3522, ext. 2970.