402.132. Charitable purposes of the institution and fund to be considered--good faith required--authority of the institution.
Charitable purposes of the institution and fund to be considered--goodfaith required--authority of the institution.
402.132. 1. Subject to the intent of a donor expressed in a gift, aninstitution, in managing and investing an institutional fund, shallconsider the charitable purposes of the institution and the purposes of theinstitutional fund.
2. In addition to complying with the duty of loyalty imposed by lawother than in sections 402.130 to 402.148, each person responsible formanaging and investing an institutional fund shall manage and invest thefund in good faith and with the care an ordinary prudent person in a likeposition would exercise under similar circumstances.
3. In managing and investing an institutional fund, an institution:
(1) May incur only costs that are appropriate and reasonable inrelation to the assets, the purpose of the institution, and the skillsavailable to the institution; and
(2) Shall make a reasonable effort to verify facts relevant to themanagement and investment of the fund.
4. An institution may pool two or more institutional funds for thepurposes of management and investment.
5. Except as otherwise provided by a gift instrument, the followingrules apply:
(1) In managing and investing an institutional fund, the followingfactors, if relevant, shall be considered:
(a) General economic conditions;
(b) The possible effect of inflation or deflation;
(c) The expected tax consequences, if any, of investment decisions orstrategies;
(d) The role that each investment or course of action plays withinthe overall investment portfolio of the fund;
(e) The expected total return from the income and the appreciation ofinvestments;
(f) Other resources of the institution;
(g) The needs of the institution and the fund to make thedistributions and to preserve capital; and
(h) An asset's special relationship or special value, if any, to thecharitable purposes of the institution;
(2) Management and investment decisions about an individual assetshall not be made in isolation but in the context of the institutionalfund's portfolio of investments as a whole and as a part of an overallinvestment strategy having risk and return objectives reasonably suited tothe fund and to the institution;
(3) Except as otherwise provided by law other than in sections402.130 to 402.148, an institution may invest in any kind of property ortype of investment consistent with this section;
(4) An institution shall diversify the investments of aninstitutional fund unless the institution reasonably determines thatbecause of special circumstances the purposes of the fund are better servedwithout diversification;
(5) Within a reasonable time after receiving property, an institutionshall make and carry out decisions concerning the retention or dispositionof the property or to rebalance a portfolio in order to bring theinstitutional fund into compliance with the purposes, terms, anddistribution requirements of the institution as necessary to meet othercircumstances of the institution and the requirements of sections 402.130to 402.148;
(6) A person that has or represents to have special skills orexpertise and in reliance thereupon is selected and assigned institutionalfunds management and investment functions has a duty to use those skills orthat expertise in managing and investing institutional funds.
(L. 2009 H.B. 239)