An often-volatile economy, changing demographics, and technological innovations in educational delivery are among the dramatic changes across higher education that have forced boards and institutions to question the viability of the existing business model. Flat or declining state support in real terms, lower investment returns in some years,…

Developing return-oriented green revolving funds (GRFs) is a rapidly growing trend at colleges and universities. A green revolving fund (GRF) is a special account designated for investment in on-campus projects that improve energy efficiency or decrease material use. GRFs invest in a variety of cost-saving initiatives, resulting in significant…

In the late summer of 2008, after the 2007-2008 fiscal year's books had closed, the nation's wealthiest universities were confronted with an unfamiliar sight: single-digit endowment returns. Not since 2003 had Harvard University (Cambridge, Massachusetts), Princeton University (Princeton, New Jersey), or Stanford University (Stanford, California)…

As college presidents face the challenges of a turbulent and uncertain economy, they are working to assess the impacts on their strategic financial positions and to develop response plans that reflect their institutional missions and values. How can college presidents navigate during these difficult economic times as they seek to hold on to the…

Alternative investments (those that exhibit risk and return properties not easily attainable from traditional asset classes) constitute an investment option that no modern college or university investment strategist can ignore. Colleges and universities with larger allocations to alternatives outperformed institutions with smaller allocations in…

The difference between cost and market value of endowment investments is significant for many colleges and universities. These investments should always be reported at market value to provide relevant, comparable, consistent, and understandable financial information. Nonmanagement users of institutional financial statements prefer market rather…

This guide is intended to assist directors and board members of foundations affiliated with public institutions as they manage investments and assets of their institution. Introductory information notes duties of foundation directors and legal criteria for prudent investing under the Uniform Prudent Investor Act. Suggestions for developing…

College investment policy concerning the mix of stocks and bonds in the endowment portfolio has been made far too complicated. Except for unusual circumstances, the equity (common stocks) percentage should be very high. Total investment in equities will generate enormous differences in endowment fund value over a long period of time. (MSE)

College and university business officers are encouraged to implement an endowment distribution method that increases the amount distributed by a fixed annual percentage based on asset mix, inflation, and expected return. Such a payout system provides a predictable, steadily increasing level of endowment income yet maintains the purchasing power of…

Two accounting strategies for classifying college or university endowment losses are compared: reduction of permanently restricted net assets and reduction of unrestricted net assets. The approaches differ in their effects on classification of net assets only when capital losses on endowment investments bring the fund below the level required in…

The 1996 National Association of College and University Business Officers (NACUBO) study of 472 colleges' endowment fund performance found an equal-weighted mean return of 17.2%, with private institutions faring slightly better than public institutions. Data are presented on investment pool asset allocations, investment pool nominal returns,…

This report details results of a 1991 survey of 396 colleges and universities concerning aggregate investment base ($64.5 billion), spending rates, purchasing power, asset allocation, and performance measures. A table lists the institutions, their endowment assets, and their life income fund assets. (DB)

The article analyzes the performance of endowment investment pools based on survey results from 367 colleges and universities. Analysis considers wealth concentration, purchasing power, spending rates, asset allocation, and financial performance. A ranked listing of the institutions reports on endowment assets and life income fund assets as of…

Describes Maine's new initiative to make art education a part of each student's school day through the Arts in Schools Basic Education Grants. Indicates a change in emphasis from artists in school to the development of curriculum. Urges acceptance of this program as a broadening of focus, not a replacement for artists' residencies. (KO)

Flexible endowments are a form of planned giving agreement letting highly motivated donors give endowment-level funding to colleges and universities before they are able to make an outright gift. The donor commits to giving the institution the amount of money an endowment would have generated each year until the endowment principle is fully…