Investment Committee Preamble

The Carat Venture Partners investment committee (“CVPIC”) recognizes its two primary roles are one of governance and two of investing. The responsibility of the investment committee is to ensure that those individuals responsible for investing the Carat Venture Partners’ Fund’s assets are doing so in compliance with the agreed investment charter.

We believe that by maintaining the assets resourcefully, there must be a clear dividing line between investment committee governance and investment strategy implementation.

The investment committee’s involvement in managing direct investing activities is therefore not required. The management of the investments are handled by investment professionals and managing partners who are managing the investment portfolio full-time.

The investment committee outline

1. Comprise members who bring relevant experience to the investment strategy that is complementary to that found with the internal managing partners, portfolio management team, and other members of the committee. This should include overall multi-sector portfolio experience. Experience-based, but naturally biased views need to be balanced around the table with a committee of 3 or 5 members.

2. Have an explicit understanding of the purpose and objective of the fund thesis and assets with a clear definition of success in determining whether the portfolio fulfills that purpose and meets that objective.

3. Understand the Investment Committee Charter, including the outline of the roles and responsibilities of its members, support staff, and, if applicable, external advisors. This charter includes the importance of CVPIC meeting preparation and in-person attendance, the rules on investment committee member tenure to ensure fresh expertise is constantly being introduced to the committee whilst preserving collective familiarity with the portfolio, its fiduciary duties of each member, terms of engagement and policies to which they commit – e.g., conflict of interest.

4. Review and understand the investment strategy with its set of assumptions about the organization’s risk tolerance, the portfolio’s expected returns, and the basis for establishing annual withdrawals.

5. Review and understand the short-term and long-term performance.

6. Exercise sound judgment through a disciplined process built around routine (quarterly) meetings, with clear processes for making decisions, or having input to decisions as needed between committee meetings. The investment committees generally meet four times a year. Meetings can last for anywhere between two hours or a full day. Three hours is normal, with the first meeting of each year usually longer as it covers more discussion on the previous year’s performance and the coming year’s investment strategy. How these three hours are spent is of critical importance to the effectiveness of the investment committee.

Investment Committee Agenda Outline

Below, is the agenda outline that we believe makes the best use of time in CVP’s investment committee meetings. The role of the CVPIC Chair is critical to the success of the committee. The most effective CVPIC Chair sets out a clear agenda for each meeting, ensures materials have been sent out and read in advance, and then, during the meeting, encourages input and discussion from the committee members, drawing on specific individuals where they are most likely to have relevant insight on a particular topic.

We believe the most effective Chair of our portfolio investment committee has a clear view of what past and present external exposure committee members have had to other institutional portfolio management situations and draws on that experience of individuals to bring that perspective to bear on for the current portfolio being discussed.

All actions of the Committee will require the vote of a majority of its members present at the meeting of the Committee at which a quorum is present.

The most effective meetings occur when specific individuals have been given advance notice of areas where the Chair would like input on a key topic. The usual meeting effectiveness rules apply.

Most meetings will cover the following 4 topics as the standard part of the agenda:

1. Investment Portfolio Assessment – Review management investment recommendations and decide and vote on the Fund’s startup investment portfolio

2. Investment Performance Assessment – targets and benchmark performance review

3. Macroeconomic assessment and related tactical asset allocation dynamics

4. Monitoring compliance with the investment policy focused on investment philosophy, risk level, liquidity, and asset allocation.

Investment Committee Special Topics

Below are special topics that may be brought into CVPIC meetings on a less frequent basis, usually annually:

• Recommendation to the board by revisiting the Fund’s purpose and the alignment of that purpose with the right investment approach (e.g., incorporating socially responsible and mission-driven investing).

• Recommendation to the board by planning responses to potential macroeconomic or financial market events (e.g., are we committed to holding to risk budgets and rebalancing in all crisis scenarios?

• Recommendation to the board about the Investment Committee membership, tenure, roles, and meeting process.

We do not doubt that good investment committee governance can have a material impact on an institution’s long-term investment performance.

Investment Committee Charter

Original release: October 2022

The Investment Committee (the “Committee” ) has the oversight responsibility, authority, and specific duties as described below.

Composition

The Committee will be comprised of at least three members of the Board.

The members and chair of the Committee shall be elected by the Board at the annual meeting of the Board and shall serve until the next annual meeting of the Board. Notwithstanding, each member shall serve until his or her successor is duly elected and qualifies.

Purpose

The purpose of the Committee is to (a) review, approve, or decline management’s investment recommendations (b) monitor the performance of the Fund’s investment assets; (c) review the investment policies and guidelines of the Fund and make recommendations to the Board periodically regarding the same;

Management Support

The Chief Financial Officer and at least one Managing Partner will support and assist the Committee.

Meetings

The Committee will meet at least four (4) times annually and as many additional times as the Committee deems necessary. Meetings of the Committee may be held virtually. The presence of a majority of the Committee members will constitute a quorum for the transaction of business, and the affirmative vote of a majority of the Committee members present and constituting that quorum will be required for Committee action on any voting matter.

The Committee, in its discretion, may ask members of management or others to attend its meetings and provide pertinent information.

The Committee Chair will work with the President, Chief Financial Officer, other appropriate Fund management, and the other Committee members to develop each meeting agenda. The Committee Chair shall approve the contents of the final agenda for each meeting.

The Committee shall maintain minutes of such meetings, and copies of all minutes shall be distributed to the Board.

Attendance

Committee members will strive to be present at all meetings. As necessary or desirable, any member of the Committee may request that members of management and the Foundation’s investment consultant(s) be present at Committee meetings.

Specific Duties

In carrying out its responsibilities, the Committee will:

• Determine the rules of procedure and operation of the Committee.

• Review and reassess the adequacy of this Charter annually and recommend any proposed changes to the Board for approval.

• Monitor the performance of the Foundation’s investment assets.

• At least annually, review the overall investment philosophy, goals, and objectives of the Fund and, if appropriate, amend or recommend that the Board amend such goals and objectives.

• At least annually, meet with the Fund’s external investment consultant(s) if applicable, and at least a portion of the Fund’s investment managers to receive performance reports and discuss trends, future strategies, and recommendations.

• Have access to appropriate funding information necessary to carry out the duties and responsibilities set out herein.

• Conduct an annual evaluation of the performance of the Committee, including its effectiveness and compliance with this Charter.

• Report regularly to the Board on Committee findings and recommendations.