EXHIBIT-99. CODE ETH
NEW COVENANT FUNDS
CODE OF ETHICS
GENERAL
This Code of Ethics ("Code") of the New Covenant Funds (the "Trust") is adopted
pursuant to the requirements of Rule 17j-1 under the Investment Company Act of
1940, as amended (the "1940 Act"), and shall apply to each series of shares of
the Trust now in existence or hereafter created.
Rule 17j-1(a) under the 1940 Act makes it unlawful for any employee, officer or
trustee of a registered investment company or its investment adviser or
principal underwriter, and certain other affiliated persons of such entities, in
connection with the purchase or sale, directly or indirectly, by such person of
a security "held or to be acquired" by such investment company, to (i) employ
any device, scheme or artifice to defraud such investment company; (ii) make to
such investment company any untrue statement of a material fact or omit to state
to the Trust a material fact necessary in order to make the statements made, in
light of the circumstances under which they are made, not misleading; (iii)
engage in any act, practice, or course of business which operates or would
operate as a fraud or deceit upon the investment company; or (iv) engage in any
manipulative practice with respect to the investment company.
The underlying general principles of this Code are that "access persons," (as
defined below) in conducting their personal "securities" (as defined below)
transactions, (i) owe a fiduciary duty to shareholders of an affiliated
investment company and at all times have a duty to place the interests of such
shareholders ahead of their personal interests, (ii) are obligated to conduct
all personal "securities" transactions in accordance with this Code and in a
manner so as to avoid any actual or potential conflict of interest or abuse of
such person's position of trust and responsibility, and any appearance of such
conflict of interest or abuse of position, and (iii) should not take
inappropriate advantage of their positions.
I. DEFINITIONS
(1) "Access Person" means any trustee, officer or Advisory Person (as
defined below) of the Trust and the Adviser and the Trust's
sub-advisers.
The defined term `Access Person' and `Advisory Person' shall not
include
(1) any person who is subject to securities transaction reporting
requirements of a code of ethics adopted by an adviser or
sub-adviser;
(2) any employee of an underwriter subject to securities transaction
reporting requirements of a code of ethics adopted by the
underwriter."
(2) "Advisory Person" means any employee of the Trust, the Adviser or
sub-advisers who, in connection with his or her regular functions or
duties, makes, participates in, or obtains information regarding the
purchase or sale of a Security by the Trust, or whose functions
relate to the making of any recommendations with respect to such
purchases or sales, and any natural person in a control relationship
to the Trust, the Adviser or the Trust's sub-advisers, who obtains
information concerning recommendations made to the Trust with regard
to the purchase or sale of Securities by the Trust.
(3) "Investment Personnel" means any employee of the Trust, the Adviser
or the Trust's sub-advisers who, in connection with his or her
regular functions or duties, makes or participates in making
recommendations regarding the purchase or sale of Securities by the
Trust, and any natural person who controls the Trust, the Adviser or
sub-advisers and who obtains information concerning such
recommendations.
(4) "Security" shall have the meaning set forth in Section 2(a) (36) of
the 1940 Act except it does not include securities issued by the
Government of the United States or by federal agencies and which are
direct obligations of the United States, bankers' acceptances,
certificates of deposit, commercial paper, high quality short-term
debt instruments (including repurchase agreements) and shares of
registered open-end investment companies.
(5) A "security held or to be acquired" means a Security which, within
the most recent 15 days: (i) is or has been held by the Trust; or
(ii) is being or has been considered by the Trust, the Adviser or
the Trust's sub-advisers for purchase by the Trust, and includes an
option to purchase or sell, and any Security which is convertible
into or exchangeable for, a Security described in (i) or (ii) of
this sub-Section.
(6) "Beneficial Ownership" shall have the meaning ascribed thereto under
Section 16 of the Securities Exchange Act of 1934, as amended, and
the rules and regulations thereunder. Generally, a person is
regarded as having a beneficial interest in those securities held in
his or her name, the name of his or her spouse and the names of his
or her minor children who reside with him or her. A person may be
regarded as having a beneficial interest in the securities held in
the name of another person (individual, partnership, trust, or
another entity) if, by reason of a contract, understanding or
relationship he or she obtains or may obtain therefrom benefits
substantially equivalent to those of ownership.
(7) "Chief Investment Officer" shall be both an Access Person and the
Advisory Person who is the designated officer of the Trust
responsible for overseeing and monitoring all investment decisions
made by the sub-advisers on behalf of the Trust.
(8) "Control" means the power to exercise a controlling influence over
the management or policies of a company, unless such power is solely
the result of an official position, as further defined in Section
2(a)(9) of the 1940 Act.
(9) "Initial Public Offering" means an offering of securities registered
under the Securities Act of 1933, the issuer of which, immediately
before the registration, was not subject to the reporting
requirements of Sections 13 or 15(d) of the Securities Exchange Act
of 1934.
(10) "Limited Offering" means an offering that is exempt from
registration under the Securities Act of 1933 pursuant to Section
4(2) or Section 4(6) or pursuant to rule 504, rule 505, or rule 506
under the Securities Act of 1933.
2. PROHIBITIONS
(a) No Access Person in connection with the purchase or sale, directly
or indirectly, by such person of a security held or to be acquired
by the Trust:
(i) shall employ any device, scheme or artifice to defraud the
Trust;
(ii) make to the Trust any untrue statement of a material fact or
omit to state to the Trust a material fact necessary in order
to make the statements made, in light of the circumstances
under which they are made, not misleading;
(iii) engage in any act, practice, or course of business which
operates or would operate as a fraud or deceit upon the Trust;
or
(iv) engage in any manipulative practice with respect to the Trust.
(b) No Access Person shall purchase or sell, directly or indirectly, any
Security in which he or she has, or by reason of such transaction
acquires, any direct or indirect beneficial ownership and about
which he or she knew, or should have known, at the time of such
purchase or sale:
(i) is being considered for purchase or sale by the Trust; or
(ii) is then being purchased or sold by the Trust.
(c) No Access Person shall, directly or indirectly, purchase or sell any
security in which such person has, or by reason of such transaction
acquires, any direct or indirect beneficial ownership which would
involve the use of "inside" information.
3. EXEMPTED TRANSACTIONS
The Prohibitions of Sections 2(b) and 2(c) of this Code shall not apply to
transactions concerning:
(a) Purchases or sales effected in any account over which the Access
Person or Investment Personnel has no direct or indirect influence
or control.
(b) Purchases or sales of Securities which are not eligible for purchase
or sale by the Trust.
(c) Purchases or sales which are non-volitional on the part of the
Access Person or Investment Personnel or the Trust.
(d) Purchases which are part of an automatic dividend reinvestment plan.
(e) Purchases effected upon the exercise of rights issued by an issuer
pro rata to all holders of a class of its securities, to the extent
such rights were acquired from such issuer, and sales of such rights
so acquired.
4. PROCEDURAL MATTERS
The Trust shall appoint an appropriate compliance officer who shall:
(a) Furnish a copy of this Code to each Access Person upon commencement
of employment and annually thereafter so each such Access Person may
certify that he or she has read and understands said Code and
recognizes that he or she is subject to the principles and
prohibitions contained therein.
(b) Review all reports submitted under Sections 6, 7 and 8 of this Code
to detect conflicts of interest and abusive practices.
(c) Notify quarterly each Access Person of his or her obligation to file
a Quarterly Report as provided by Section 6 of this Code.
(d) Notify each new Access Person of his or her obligation to file an
Initial Report as provided by Section 7 of this Code.
(e) Notify annually each Access Person of his or her obligation to file
an Annual Report as provided by Section 8 of this Code.
(f) Notify annually the Adviser and each Sub-Adviser of its obligation
to file a written report and annual certification as provided by
Section 10 of this Code.
(g) Promptly report to the Board of Trustees the facts contained in any
report filed with the compliance officer pursuant to Section 6, 7 or
8 of this Code when such report indicates that an Access Person
engaged in a transaction in a Security held or to be acquired by the
Trust, or otherwise violated or appeared to violate this Code and
its reporting requirements.
(h) At least annually, furnish to the Board of Trustees a written report
that (i) describes any issues arising under this Code, including
information about material
violations and procedures and sanctions imposed in response to the
material violations; and (ii) certifies that the Fund has adopted
procedures reasonably necessary to prevent violations of this Code
by any person who is an Access Person hereunder.
(i) Maintain a current list of all Access Persons and identify all
reporting Access Persons on such list, and shall take steps to
ensure that all reporting Access Persons have submitted reports,
confirmations or statements in a timely manner.
(j) The compliance officer shall maintain a record of any decision
authorized to be made under this Code, and the reasons supporting
the decision, to approve a personal securities transaction otherwise
prohibited under this Code for at least five (5) years after the end
of the fiscal year in which the approval is granted.
(k) Maintain the records required by paragraph (f) of Rule 17j-1.
5. REPORTING EXCEPTIONS
(a) Not withstanding the provisions of Sections 6, 7 and 8 of this Code,
an Access Person shall not be required to make a report with respect
to transactions effected for, and Securities held in, any account
over which such person does not have any direct or indirect
influence or control.
(b) A disinterested trustee of the Trust: (i) need not make the Initial
and Annual Reports required by Sections 7 and 8 of this Code; and
(ii) need only report, on a Quarterly Report required by Section 6
of this Code, a transaction in a Security if such trustee, at the
time of that transaction, knew or, in the ordinary course of
fulfilling his or her official duties as a trustee of the Trust,
should have known, that during the 15-day period immediately before
or after the date of the transaction by the trustee, such security
was purchased or sold by the Trust or was being considered for
purchase or sale by its investment adviser or sub-advisers.
(c) Any report required under Section 6, 7 or 8 of this Code may contain
a statement that the report shall not be construed as an admission
by the person making such report that he or she has any direct or
indirect beneficial ownership in the Security to which the report
relates.
6. QUARTERLY REPORTS
(a) All Access Persons subject to reporting shall direct their brokers
to supply, at the same time that they are sent to the Access Person,
a copy of the confirmation for each personal securities trade and a
copy of each periodic account statement to the compliance officer.
Access Persons need not make a Quarterly Reports if such trading and
account statements contain all of the information required in
subsection (b) to be disclosed in the Quarterly Report.
(b) Every Access Person shall report the information described below
with respect to transactions in any Security in which such Access
Person has, or by reason of such transaction acquires, any direct or
indirect beneficial ownership in the Security. The Quarterly Report
shall be made not later than 10 calendar days after the end of the
calendar quarter in which the transaction to which the report
relates was effected. Each Access Person shall submit a Quarterly
Report for each quarter, including those quarters during which no
Securities transactions were effected. The Quarterly Report shall be
made on the form attached as Exhibit A and shall contain the
following information:
(i) the date of the transaction, the title and the number of
shares, and the principal amount of each Security involved,
and the interest rate and maturity date (if applicable);
(ii) the nature of the transaction (i.e., purchase, sale or any
other type of acquisition or disposition);
(iii) the price at which the transaction was effected;
(iv) the name of the broker, dealer or bank with or through whom
the transaction was effected; and
(v) the date that the Access Person submitted the Quarterly
Report.
(c) With respect to any account established by an Access Person, in
which any Securities were held during the quarter for the direct or
indirect benefit of the Access Person, the Access Person shall
include on the Quarterly Report the following information:
(i) the name of the broker, dealer or bank with whom the Access
Person established the account; and
(ii) the date the account was established.
(d) Pursuant to Rule 17j-1(d)(2)(iv), no Quarterly Report need be made
by Access Persons who make reports to the advisor or sub-advisers,
pursuant to Rule 204-2(a)(12) or (13) of the Investment Advisers Act
of 1940, if such report duplicates the information required under
the reporting requirements of the sub-advisers.
7. INITIAL REPORTS
Each Access Person shall disclose all personal Securities holdings to the
appropriate compliance officer not later than 10 days after becoming an
Access Person. The Initial Report shall be made on the form attached as
Exhibit B and shall contain the following information:
(a) the title, number of shares and principal amount of each Security in
which the Access Person had any direct or indirect beneficial
ownership when the person became an Access Person;
(b) the name of any broker, dealer or bank with whom the Access Person
maintained an account in which any Securities were held for the
direct or indirect benefit of the Access Person as of the date the
person became an Access Person; and
(c) the date that the Access Person submitted the Initial Report.
8. ANNUAL REPORTS
Each Access Person shall disclose all personal Securities holdings on an
annual basis within 30 days after the end of the calendar year. The Annual
Report shall provide information on personal Securities holdings that is
current as of a date no more than 30 days before the Annual Report is
submitted. The Annual Report shall be made on the form attached as Exhibit
C and shall contain the following information:
(a) the title, number of shares and principal amount of each Security in
which the Access Person had any direct or indirect beneficial
ownership;
(b) the name of any broker, dealer or bank with whom the Access Person
maintains an account in which any Securities are held for the direct
or indirect benefit of the Access Person; and
(c) the date that the Access Person submitted the Annual Report.
9. VIOLATIONS AND SANCTIONS
Upon being apprised of facts that indicate that a violation of this Code
may have occurred, the Board of Trustees of the Trust shall determine
whether, in their judgment, the conduct being considered did in fact
violate the provisions of this Code. If the Board of Trustees determines
that a violation of this Code has occurred, the Board may impose such
sanctions as it deems appropriate in the circumstances, including without
limitation, one or more of the following: warnings, periods of "probation"
during which all personal investment activities are prohibited (except for
specifically approved liquidations of current positions), a letter of
censure, suspension with or without pay, termination of employment, or
disgorgement of any profits realized on transactions in violation of this
Code. If the person whose conduct is being considered by the Board is a
Trustee of the Trust, he or she shall not be eligible to participate in
the judgment of the Board as to whether a violation exists or in whether,
or to what extent, sanctions should be imposed.
10. ADVISOR AND SUB-ADVISERS' CODES OF ETHICS
The Advisor and each of the sub-advisers shall:
(a) Submit to the Board of Trustees of the Trust a copy of the code of
ethics adopted by such sub-adviser pursuant to Rule 17j-1 of the
1940 Act and/or Rule 204-2(a)(12) of the Investment Advisers Act and
a certification that such sub-adviser has adopted procedures
reasonably necessary to prevent its respective Access Persons from
violating such code of ethics.
(b) Promptly report to the Board of Trustees of the Trust in writing any
material amendments to such sub-adviser's code of ethics.
(c) Immediately furnish to the Board of Trustees all material
information regarding any violation of such sub-adviser's code of
ethics by any person who would be an Access Person hereunder if such
person were not subject to the sub-adviser's code of ethics.
(d) Provide quarterly reports to the Adviser representing that no
material violations of their respective codes of ethics were made
during the period so indicated.
(e) No less frequently than annually, furnish to the Board of Trustees a
written report that (i) describes any issues arising under such
adviser or sub-adviser's code of ethics, including information about
material violations and procedures and sanctions imposed in response
to the material violations; and (ii) certifies that such adviser or
sub-adviser has adopted procedures reasonably necessary to prevent
violations of its code of ethics by any person who would be an
Access Person hereunder if such person were not subject to the
adviser or sub-adviser's code of ethics.
11. CONFIDENTIALITY
All personal securities transactions reports disclosing personal
securities holdings, and any other information filed pursuant to this
Code, shall be treated as confidential, but are subject to review as
provided herein and by representatives of the Securities and Exchange
Commission.
REVISED: MAY 17, 2004