Ka Wai Ola - Office of Hawaiian Affairs, Volume 13, Number 7, 1 July 1996 — What is our responsibility continuum [ARTICLE+ILLUSTRATION]

What is our responsibility continuum

By the Rev. Moses Keale, Sr. Trustee, Kaua'i and Ni'ihau There are three fundamental and pressing aspects of any trust - the securing of the trust assets, investment of trust assets to ensure the trust's eonūnuum and the deliverance of benefits to the beneficiary. The investment of trust assets is just as important as securing the

trust asset. Many criticize OHA for its Investment policy, procedures and philosophy. In all fairness, this criticism may be misplaced. We will never know whether different investment bankers and institutions would have done better than the ones chosen to handle OHA monies. I I liken such second guessing I

to Monday Night quarterbacking. It is always easier to make the calls from afar and £ifter the fact. This is not to say that I have always or continue to agree with OHA's choices. However, there is a far more sinister and disturbing problem — it is the purposeful and malicious disregarding of OHA's policies and procedures in the process of

making important and substantial decisions such as our investment packages. OHA's policies and procedures regarding almost all matters before this Board eontinue to be deliberately violated. We opened with no policy, no procedures, no directions, and no defined goals. Over the next 10 years we developed (and I played a key role in that development) a full set of policies and procedures,

goals and objectives, and set a tone whieh would ensure a process whieh could protect everyone's interest - beneficiary, public, staff, trustees, and the trust corpus. The policies and procedures worked and extensive discussions occurred prior to the execution of any and all actions by the Board. I am very saddened and disturbed

to report that this process has been circumvented, twisted, bent and misshaped over the last few years. It is this horrible diversion firom what is right (PONO), that causes the most potential danger - greater than in the past because we now handle far more money than ever, wield far more power, and affect the quality of life of far more beneficiaries than ever before.

Rather than a few million dollars, we now handle hundreds of millions of dollars. Having said this, how then have we selected our investment managers? We selected them without proper and appropriate due process and deliberations. Selected trustees are given the opportunity to meet with and study documents provided by eaeh potential investment manager. If and when these studies are ever fully shared with the other trustees, those documents are placed before us just days or sometimes even hours before such a decision is to be made. This procedure violates the written policy of this Board. Items to be considered for action by the Board or its committees are required to be fully documented and all pertinent information is required to be placed before eaeh trustee at least 72 hours prior to its consideration. More preferably and properly it should be available at least six days prior to the meeting. This is not impossible because an agenda is required to be submitted to the Lt. Governor's Office six days prior to any meeting. In addition, OHA's policy regarding referrals to the Board or another committee must be forwarded 10 days prior to the next meeting. These rules were created to ensure that proper deliberation and informed input

would be maintained. When decisions are forced to be made without documentation and time to study, proper decision is impossible. This has gone on for the last six years. You may be asking why have I not done anything about this. The answer is very simple. I am in the minority. The strategy of how this Board functions runs on the principal "Do you have the 5 votes?" - rather than - "have we performed our duties in accordance with our policies and procedures?" When I make my objections known to our duly appointed and paid for Board attorney (Ms. Sherry Broder) she reinterprets what the Board passes as rules and guidelines rather than policies and procedural law. My only recourse is to take my objections to a court of law. But I am denied access to an attorney when I ask for legal opinions. I must ask the attorney general who represents the Board chairman - the very person who is the Board polieeman. This is a definite eonflict of interest and a no win solution. This disturbs me as we are the losers, and the potential for dangerous opportunities exist. Next month: deliverance of services to the beneficiary.