Published February 26, 2009
DALLAS (BP) — GuideStone Financial Resources is downsizing its workforce by 10 percent through projected attrition and a hiring freeze as part of a reduction of its 2009 budget.
“The downturn in the global economy and the subsequent reduced value of securities in our investment funds has impacted the fee revenue that funds our budget,” O.S. Hawkins, president of the Southern Baptist entity, said on Jan. 27.
“Unlike the mission boards and seminaries, GuideStone receives no Cooperative Program funds from the Southern Baptist Convention. It relies solely on the fee revenue from its proprietary investment funds to provide the resources to fund the majority of its operating expenses.
“Expenses related to its life and health products are funded through the premiums paid by organizations whose participants are in those plans.”
Other reductions in operating expenses, according to the news release, include a salary freeze and “delaying some purchases such as additional computer equipment, reducing travel, delaying some professional development, and reducing the amount of printed materials by providing more materials on GuideStone’s website.”
Hawkins noted that an operating reserve also is part of its budget strategy.
Reserve fund softens downturn
“Over a decade ago, and in recognition that financial markets are cyclical, GuideStone trustees established an operating reserve that would provide additional resources for times such as these,” an agency spokesman said.
Then Hawkins added, “This reserve enables us to maintain our service levels to our participants in times when the markets are down. We must use it prudently in order to extend its ability to offset our anticipated revenue shortfall.”
Hawkins said additional budget reductions may be required, explaining, “While we are hopeful about the future, further deterioration in the financial markets or a significantly prolonged recovery from the current recession may require other measures to further reduce future costs. Continued monitoring of the budget and additional strategic planning is a priority as we move through 2009 and into 2010 with all of its financial uncertainties.
“If the financial markets continue to decline, GuideStone has a strategic plan to add other budget cuts when and if they are needed,” Hawkins said. “If the markets stabilize, GuideStone will carefully monitor its expenses to operate within its modified budget.
“Even if the markets should begin to rebound, it will likely take an extended period of time to regain the losses experienced during this period of unprecedented market volatility.
Reductions are “absolutely necessary,” Hawkins says
“We believe these reductions are absolutely necessary and we must all be diligent to maximize the resources that remain available to us,” Hawkins said. “More than ever before, we are challenged to find ways to serve our participants in a manner that seeks to enhance their financial security.”
GuideStone repeated its ongoing advice to participants in its various retirement savings/investment programs.
In a press released, it said, “During the last year, worldwide financial markets have experienced a season of volatility that the world has not seen in a generation. The extreme market volatility has caused many investors to re-evaluate their risk tolerance.
“GuideStone has always encouraged retirement investors to be well diversified and appropriately allocated. It is important for participants to evaluate their current asset allocation based on their long-term goals and objectives.”
The news release noted that investors who may want to review their risk tolerance can access their investor profile by going to www.GuideStone.org/InvestorProfile.
“Investing for the long term brings with it unavoidable ups and downs along the way,” the news release stated.
“Through its manager of managers approach to building its investment funds, GuideStone is able to access the talents of world-class investment management firms and has avoided the pitfalls of hedge funds such as those reported in the recent Madoff scandal.”
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