Today's college and university boards find themselves faced with ever-increasing challenges as they attempt to meet the financial needs of their institutions while complying with a myriad of fiduciary responsibilities. How can boards best meet the financial needs of their institutions? Representatives of Ball State University Foundation describe…

Major demographic changes around the world. Disproportionate sovereign debt. A shift from North America, Western Europe, and Japan to emerging economies as centers of growth. Unprecedented levels of market risk and volatility. The structure of the global economy is undergoing significant changes. Michael Oyster, managing principal of Fund…

Dormitories, student centers, lecture halls, laboratories, athletic facilities, quads--just try to imagine a residential campus without them. Impossible. They are among its most important assets. As fiduciaries, boards must ensure that those assets are protected and enhanced over time. But how to do so effectively when growing internal and…

A new study of endowments by the National Association of College and University Business Officers (NACUBO) and the Commonfund Institute has brought good news to college and universities: While endowment returns dropped precipitously in fiscal year 2009 as a result of the financial crisis and accompanying slide in equity markets, they climbed to an…

Managers of university endowment funds are paying closer attention to investing in "green" industries, commonly bundled under the umbrella "cleantech." Cleantech offers the possibility of buying in while prices are low "and" making a "green" investment play, but it also harbors the risks inherent in any emerging industry. Cleantech has varying…

Presidents and boards deal with great uncertainty all the time. Today, however, many of them also face a troubling certainty: Business as usual is the road to failure. The trend lines of revenue and expense, once aided by marginal income from growing enrollments, once amenable to marginal annual balancing tweaks, and once cushioned by reserves,…

When Commonfund and the National Association of College and University Business Officers (NACUBO) announced in late 2008 that they would join forces to combine their two endowment studies, which had historically been fielded and reported separately, they had high hopes for the venture, but those hopes were tempered with caution. The financial…

A long-term decline in state-government funding and an increase in funds from other sources are creating the need for broader types of expertise on boards of public universities. Public universities are becoming increasingly market-driven and consequently must deal with a broader base of stakeholders. As a result of these changes, public boards…

The downturn in the economy of the author's state, North Carolina, so far is less severe than that of much of the rest of the nation, due to their diversified economy, financial discipline, constitutional mandate for a balanced budget, "rainy day" fund, and many years of consistent investment in higher education. In the University of…

The context in which boards are making endowment spending decisions has changed remarkably in the past year. In January 2008, Senators Max Baucus and Charles Grassley, chair and ranking minority member, respectively, of the Senate Finance Committee, cited "explosive college endowment growth" as evidence that college and university boards should…

"Spectacular error" sounds euphemistic compared to "devastating," "catastrophic," or "meltdown"--terms more commonly summoned to describe the credit crisis and ensuing global economic carnage. Whatever they are labeled, gross miscalculations on Wall Street are having a deleterious effect on college campuses across the country, with many…

During this period of continued economic uncertainty, higher-education institutions are facing a variety of challenges that by now are very familiar to governing boards and institutional leaders, including poor investment returns, reduced liquidity, limited choices in how they structure debt issues, and threats to flexibility in tuition pricing.…

The counterintuitive approach of the world's greatest value investor, Warren Buffett, may be the best hope for colleges and universities during this recession. Buffett's time-tested philosophy of seeking value and investing for the long term remains a sound approach, even if his short-term returns have declined along with those of the rest of 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…

Urges governing boards of institutions of higher education to carefully monitor the investment fees they are paying. Offers six strategies for lowering such fees, including: (1) relying less on external and more on internal investment management; (2) increasing the dollar allocations per external manager; and (3) using more passive investment…