While hedge funds generally gave themselves a black eye in 2008 and into 2009 — with many experiencing sharp losses and closure as the market fell — it is clear to us that soundly managed and well-structured alternative funds can provide a valuable source of diversification for institutional portfolios. In 2009, after two years of due diligence, we signed a contract to act as a sub-placement agent for a multi-strategy hedge fund that integrates socially responsible investing (SRI) screens into its investment process. The fund incorporates three independent yet complementary investment styles — fixed-income arbitrage, event-driven and sector-specific long/short equity. While the fund’s SRI screens are not identical to those that we use in our institutional funds, CBIS will have representation on the committee that defines screening criteria and monitors manager compliance. We do not believe this fund will be appropriate for all CBIS participants. We are, however, excited to be able to offer a Catholic SRI hedge fund to institutions for whom such an investment makes sense. This will be the first of what we hope will be a range of new Catholic alternative SRI programs that appeal to a wider section of the institutional market than we now serve.
In response to participants’ requests for more advanced online capabilities, we selected ALPS Fund Services (ALPS), a Denver-based fund servicing company, as CBIS’ new external transfer agent. In mid-October, ALPS became the primary contact for participants with administrative questions relating to their CBIS accounts. The transition was not seamless and we appreciate the patience displayed by participants, especially those with assets in the Flex Cash Fund, as we worked through this complex project. Yet we are confident that the move is the right one. ALPS’ customer service expertise and technology platform will enable us to offer improved account service, including online account management, online transaction processing, more timely account information, and the ability to authorize additional users to access online account data. The use of an external firm that provides specialized account management services is a standard practice in the mutual fund industry. Of course, there has been no change in the way participants interact with their CBIS Investment Advisor or receive investment advice. The move simply enables us to keep up-to-date with rapidly evolving technological innovations that improve client service.
During 2009, we furthered our efforts to bring Catholic SRI investing to Europe through our work with CBIS Global, the European division of CBIS. Launched in 2008, CBIS Global is being led by Brother Louis DeThomasis, one of the founders of CBIS, with the same entrepreneurial spirit and belief in mission that he brought to CBIS in its early days. CBIS Global now offers four euro-denominated funds, including a European short-term government bond fund, a global bond fund, a European equity fund and a global equity fund. The Funds are registered and incorporated in Ireland under the auspices of UCITS 2003 and are available throughout the European Union and the world according to individual country requirements.
This will be the first of what we hope will be a range of new Catholic alternative SRI programs that appeal to a wider section of the institutional market than we now serve.