Operational Committees Endorse Approach
Equestrian Canada (EC) is pleased to announce that its Board of Directors has approved a new Corporate Reserve Fund Policy, which took effect on May 1, 2021.
The Corporate Reserve Fund ensures that EC is positioned to respond effectively to variable economic conditions and to fund special projects that align with strategic goals while, at the same time, safeguarding its operational budgets, providing financial stability and ensuring that it can seamlessly fulfill its mission for years to come.
“The Corporate Reserve Fund allows us to build a financial reserve that protects our activities against emergency situations, such as natural disasters, revenue losses, and, of course, pandemics,” said EC President, Chris Sorensen. “The Fund may also be used for a variety of key activities and special projects that are aligned with our Strategic Plan.”
Corporate reserve funds are created to protect not-for-profit organizations and to ensure that emergency funds are available to support them, if required. Organizations that establish reserve funds must adhere to a Board-approved reserve fund policy that explicitly documents the reasons for maintaining the reserve balances; how the reserve amounts were calculated and quantified; and how the reserve amounts will ultimately be used.
“Our new Corporate Reserve Fund Policy was developed over the past year, and, recently, was further adjusted in response to feedback we received from our Operational Committees last December, when we first presented the policy,” explained EC CEO, Meg Krueger. “We decided to slow down the review process and take the time to address their very real concerns. We re-presented the policy framework to the Committees in March and April, adding further detail on historical balances and future funds, and it has been a positive process that shows real solidarity in our sport.”
One of the recent modifications made to the Corporate Reserve Fund Policy pertains to the use of historical balances, which will be drawn down over time, with all future Corporate Reserve Fund deposits specifically allocated to building the Corporate Reserve Fund.
EC’s Corporate Reserve Fund will ensure:
- EC’s ability to manage its cash flow and maintain financial flexibility when needed;
- The long‐ term financial stability of EC and its ability to respond to varying economic conditions;
- The availability of emergency funds to support EC when required;
- The availability of supplementary funding for special projects to assist in achieving EC’s strategic goals; and,
- The capacity of EC to continuously carry out its mission – “to lead, support, promote, govern and advocate for the equine and equestrian community in Canada” – for years to come.
EC’s Corporate Reserve Fund will be developed over a 10-year period and the goal is for it to reach 50% of EC’s annual operational budget in that time and to provide necessary financial support for special projects across the organization that help achieve EC’s strategic goals. It will be seeded in May 2021 with a one-time, 15% allocation from each discipline balance and will grow annually, thanks to an annual investment and savings strategy, starting in the 2022-2023 fiscal year.
“As chair of the Jumping Committee, I have been very concerned about the reserve fund topic. I’m so pleased to say that in working with Meg, I feel the major issues of our committee were addressed. Meg has undertaken a collaborative approach to moving forward with a forward-thinking strategic policy that will allow the disciplines to thrive, as well as protect EC from unforeseen financial difficulties like we’ve all been facing through this pandemic,” said EC Jumping Committee Chair, Karen Sparks.
EC Endurance Committee Chair, Dessia Miller, added, “Navigating through EC governance and accounting practice changes over the past six years has sometimes been very challenging for our relatively small discipline. We are pleased to see that the Endurance Committee’s efforts over that period have resulted in an equitable financial structure that maintains the integrity of funds specifically ear-marked for international endurance competition. There is more accountability that in turn offers freedom to grow endurance programs both nationally and internationally without having to fight for our fair share. This is a solid financial foundation that we can build upon.”
“We are pleased with the balance this new policy strikes between allowing Committees to continue supporting necessary projects and the common goal of business viability and transparency for the national federation at large,” concluded Equine Medication Control Committee Chair, Dr. Yves Rossier.
“We are very pleased with the resulting policy. We want to thank our Discipline and Operating Committees for their commitment to fiscal responsibility and their solution-oriented mindset throughout the policy review process,” said Krueger. “When we work together, we always come out stronger.”