The Society for the
Psychological
Study of Social Issues

    

 


   
   Secretary-Treasurer’s Report

   By Margaret Bull Kovera



I want to take this opportunity to report on the financial health of the organization as well as some of the actions that SPSSI Council has taken over the past year to ensure the continued well-being of the organization.  When I last wrote to you, we had experienced a significant downturn in our publication revenue and lost our tenant at the Central Office, which forced us to make some tough budget decisions.  We cut the budgets associated with some programs, froze the salaries of Central Office staff, and sought savings by seeking lower cost providers of professional services (e.g., accounting, legal).  We suspended our practice of setting aside funds for outside groups who regularly seek SPSSI’s financial support for activities that are related to our mission.  Despite these efforts, we had projected a deficit budget for 2011.  Council authorized a draw on the principal in our Money Market account to cover this deficit and authorized similar draws for the next several years, hoping that the economy would stabilize during this period of time. 

It is my pleasure to write that our financial outlook appears much more rosy at the close of 2011. We received unexpected revenue from the sales of our books, which somewhat offset the decrease in journal revenue.  Although journal revenue was still almost $75,000 lower in 2011 than it was in 2010, our projections had predicted a $115,000 decrease that was not fully realized. Our Executive Director Susan Dudley’s diligent search for a new tenant was eventually successful, providing some unexpected rental income in 2011 that is projected to continue for 2012.  In addition, our revenue from interest and dividends was three times what was projected.  Coupled with our cost-saving measures, the fiscal outlook at the beginning of 2012 is much brighter than it was at the beginning of 2011.

SPSSI ended FY11 with a surplus of about $71,460, with revenue at $788, 405 (a $17k decrease from 2010) and expenses at $649,822 (a $90,000 decrease in expenses from 2010).  These are estimates as the books are not yet closed on 2011 and have yet to be reviewed by the aduitors but it is clear that we will end 2011 with an unexpected surplus.  Thus, there was no need to draw funds from our money market account.  This was good news indeed

The outlook for 2012 continues to look good.  Wiley projects that our journal revenue will begin to rise again.  At its mid-winter meeting, Council approved a budget for 2012 that included a restoration of the funds dedicated to supporting special requests from outside organizations, cost of living adjustments and small merit increases for our outstanding Central Office staff, and the granting of some budget increases that committees had previously requested but had been denied because of last year’s revenue decrease.  Even with these additions to the budget, we are predicting that 2012 will end with a small surplus (around $11,000). 

There is also good news to report for our financial investments, After market losses in Fiscal Year 2008, SPSSI’s investment portfolio rebounded a bit in 2009, and continued its upward trend in 2010.   

o   At the end of November 2011 (we do not yet have the December reports), our investment account had a total market value of $2,043,992 for an 11-month increase of about $94,000. Currently, SPSSI’s investment portfolio is divided as follows: $113,702 in Money Market Accounts (6%), $1,296,167 in Equity (63%), $537,088 in Fixed Income Accounts (26%), and $97,003 in other assets (5%).  Our cash account also increased slightly since the start of 2011, gaining $1,349 for a total deposit of $822,845 in this account. 

In an effort to align our holdings with SPSSI’s mission, our investment policy prohibits investing in certain sectors of the market (e.g., adult entertainment, defense, alcohol, tobacco).  However, a Council member recently questioned whether our holdings in some companies in non-restricted sectors (e.g., Wal-Mart in the retail sector) were socially responsible investments.  The Council asked the Audit and Finance Committee to review its investment policies in light of this concern. 

In the case of Wal-Mart, our research suggested that many analysts view the company as a neutral investment.  Although there are concerns about the company’s employment practices and its potentially negative impact on small communities, the company has very progressive programs to reduce its impact on the environment.  Based on its environmental record, many analysts did not recommend divesting in the service of socially responsible investing.  In addition, approximately half of our holdings are with companies that appear on lists of recommended companies for socially responsible investing. 

The Audit and Finance Committee discussed whether we should alter our policy of charging our investment team with investing in approved sectors to a policy in which the committee members review each individual investment.  After discussions with our investment team, the committee was reassured that our investors are also motivated to make socially conscious decisions and that they were better informed to make these decisions on our behalf than the committee members were.  Thus, the committee voted to make no changes to our investment policy at this time.

I am now in the final year of my three-year term as your Secretary/Treasurer and I am very confident that the society is on firm financial ground and that we have weathered this economic downturn because we made some difficult decisions to tighten our belts.  Although I have been honored to serve SPSSI in this capacity, I have decided that some other activities now need my attention and have asked the Executive Committee to begin searching for my replacement.  If you are interested in serving as SPSSI’s Secretary/Treasurer and would like more information about the duties involved, please do not hesitate to contact me.  I can be reached at: mkovera@jjay.cuny.edu


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Research that produces nothing but books will not suffice.
                                                                                                                    - Kurt Lewin