You might have heard the term “institutional consulting” before, or maybe it is new to you. If you have never heard of it, an institutional consulting firm is one that offers foundations, endowments, and either private or public companies advice.
They might offer market research advice. They may offer investment advice, or they may help a company with its fiduciary responsibilities.
If you’re running an endowment, private company, or foundation, you might feel like now is the time to find an institutional consultant to advise you. Here are some compelling reasons why that might be a good idea for you.
They Can Act as a Go-Between if You Have Third-Party Vendor Relationships
If you want to contact an institutional consultant, acting as a go-between for you and third-party vendors might be one of the main reasons why you would do it. Institutional consultants are knowledgeable in many different areas, but one thing they commonly need to do is establish clear lines of communication between companies and their suppliers.
If you have suppliers that provide you with raw materials that your company uses, you want to get along with them as well as possible. If you find that negotiating with them on price and logistical issues is not going so well, you may want to have a third party sitting at the table that can smooth things over.
Your institutional consultant can help keep things friendly and productive between you and your vendors. They can act as an intermediary if you ever have a disagreement or hit a rough patch.
They Can Give You Investment Advice
Whether you’re running an endowment, private business entity, or foundation, you probably have financial experts available to you that can tell you where to keep the bulk of your money. You have operational expenses, but you’re also probably trying to invest any excess cash in such a way that you get the most back from it.
You’ll reinvest that money into your business in various ways, allowing you to expand into new markets, spearhead new ad campaigns, hire new employees, and so forth. If you contact an institutional consultant and let them advise you, your operation will likely run smoother.
This individual or company that you contact only wants to make your business more successful, even if you’re running it for philanthropic purposes more than to make a profit.
They Can Recommend Investment Changes When Necessary
You might also use an institutional consultant if you have invested money for your business or charitable organization yourself, but now, those investments are not doing very well. Perhaps you want to reallocate some of that money or diversify, but you’re not sure about the best way to do that.
These consultants are financial experts. That’s a big part of who they are and what they do. The one you contact can take a hard look at your portfolio. If they see places where reallocation would be a smart move, they will tell you about that and show you concrete numbers indicating how and why you should move that money around.
They Can Help You with Investment Policy Statements
Whether you’re running a for-profit company or not, you probably have financial statements indicating where and how you want to direct the money you’re making. You’ll have documentation stating what your goals are and what you feel the best route is to get there.
Your institutional consultant can look those over and help you draft new ones when necessary. The reason this matters is that you might try to attract some new company investors at some point. If you can show them some carefully written intent statements, that might be what it takes for them to open their wallets.
They Can Help You Draft Due Diligence Processes
Whatever kind of entity you’re running, you want the investors and stakeholders to know that you have things firmly in control at all times. You’re doing your due diligence and investing in the markets that are the most stable and should yield the best returns.
Your institutional consultant can help you prepare quarterly reports that show where the money is and what you’re doing with it. This transparency is useful. It shows that you aren’t doing anything underhanded or unethical to pocket some of the profits yourself.
There are many other reasons why contacting an institutional consultant can help you. They can be the trusted entity that directs every financial aspect of your business or philanthropic venture.
