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UW Policy Directory

Policy Governing Approval of Investments

Table of Contents

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1.  Authority

The University adopts the following policy pursuant to RCW 42.52.190. It applies to any state officer or employee, who with respect to University investments or University investment policy:

  • Is responsible;
  • Makes decisions;
  • Advises; or
  • Influences.

The policy calls these individuals “Access Persons.” This policy requires these individuals to get prior approval of certain investments in which they have an interest.

2.  General Rule

A. Permissible Investments—No Approval Required

An Access Person (as defined below) may have a direct or indirect interest in any Permissible Investments (as defined below) without prior approval of the University.

B. Investments for Which Prior Written Confirmation or Approval is Required

An Access Person may have a direct or indirect interest in property, security, equity, or debt instrument of a person, other than Permissible Investments, only after obtaining prior written confirmation or approval of the University in accordance with this policy.

C. Prohibition of Use of University Financial Information for Personal Gain

University employees and officers may not use nonpublic information acquired by virtue of their state positions for personal gain.

3.  Definitions

  1. “Access Person,” as used in this policy, means those individuals holding the offices, or exercising the responsibilities, of:
    • Regent;
    • President;
    • Provost;
    • Chief Investment Officer;
    • Vice President for Finance;
    • Investment portfolio management;
    • Investment operations;
    • Treasury operations;

    and any employee who is responsible for or acts in a decision-making, advisory, or policy-influencing capacity with respect to University investments.

  2. “Direct or Indirect Interest,” as used in this policy, shall mean a voluntarily acquired ownership interest. It shall include community property interests recognized under Washington State law. It shall include interests held for the benefit of the Access Person’s minor children. It shall not include an interest held as trustee for the sole benefit of others; interests held as executor or administrator of an estate; and interests acquired involuntarily.
  3. “Permissible Investments,” as used in this policy, means:
    • Any certificate of deposit;
    • Any money market fund maintained with a bank, broker, or other financial institution;
    • Any mutual fund;
    • Any security publicly traded in an organized market if the interest in the security at acquisition is ten thousand dollars or less; or
    • Any interest in real estate, except if the real estate interest is in or with a party in whom the University holds an investment.

It also includes dividends, interest, royalties, or other income from investments acquired prior to the adoption of this policy. Non-permissible investments acquired prior to appointment shall be disclosed in writing to the Chief Investment Officer within thirty days of appointment.

4.  Procedure for Obtaining Approval

A. Presumptive Approval

Any Access Person may make investments in publicly traded securities at any time, and the University hereby gives prior approval to such investments, so long as such investment is not reasonably likely to have a material effect on the market value of the securities in question, the investment is not undertaken due to material nonpublic information acquired by the Access Person as a result of his or her employment duties by the University, and the investment is not undertaken to alter the management or corporate structure of the business in question.

B. Summary Approval

Any Access Person may invest in entities in which the University does not invest, and the University hereby gives prior approval to such investments to any Access Person who obtains prior written confirmation from the Chief Investment Officer, that as of the date of such investment, the University has no investment in such entity, nor any present intent to invest in such entity.

C. Request for Prior Written Approval

Any Access Person (other than the Regents, the President, the Provost, the Chief Investment Officer, and the Vice President for Finance) who acquires an investment which requires University approval under this policy, shall request approval by sending a written request to the Chief Investment Officer. The request should describe the investment, its approximate value, the University’s interest in the entity, and the circumstances and timing of the proposed acquisition.

Any individual Regent, the President, the Provost, the Chief Investment Officer, and the Vice President for Finance shall, with respect to investments requiring University approval, request approval by the Chair of the Finance and Asset Management Committee of the Board of Regents by sending a written request describing the investment, its approximate value, the University’s interest in the entity, and the circumstances and timing of the proposed acquisition, to the Secretary of the Board of Regents. The Chair of the Finance and Asset Management Committee shall request approval, in the same manner, from the Chair of the Board of Regents. The Chief Investment Officer shall be consulted on all approval requests.

D. Grant or Denial of Approval

Within five business days, the Chief Investment Officer, the Chair of the Finance and Asset Management Committee of the Board of Regents, or the Chair of the Board of Regents, as appropriate, or their designees, shall evaluate the proposed investment by applying the criteria listed in Section 5 of this policy, and shall grant or deny approval in writing. Their respective decisions shall be final.

E. Record Keeping

The Chief Investment Officer and the Secretary of the Board of Regents shall each maintain records sufficient to document compliance with this policy. The records and information received by the University in the course of implementing and administrating this policy shall be maintained by the University in confidence, and shall be shielded from disclosure to the extent allowed by law. All reviewing personnel shall be advised of this requirement, and failure to abide by it shall be regarded as a serious breach of duty to the University.

5.  Criteria for Approval

In evaluating an Access Person’s request for approval of an investment, the approving officer shall consider:

  1. The relationship, if any, between the proposed investment and investments held or under consideration by the University;
  2. The size and timing of the proposed investment;
  3. Access by the Access Person to nonpublic information relative to the proposed investment; and
  4. The availability of the investment to members of the general public with comparable assets to invest.

BR, February 1996; October 17, 1997; RC, April 23, 2013; RC, October 1, 2015; RC, March 22, 2016; RC, April 19, 2016; [formerly codified as Standing Orders, Chapter 7] BR, July 11, 2019; February 13, 2020.