Following the release of the 2024 NACUBO-Commonfund Study of Endowments (NCSE), Commonfund conducted a focused analysis of data reported by the 97 participating Minority-Serving Institutions (MSIs). These institutions were identified using Integrated Postsecondary Education Data System (IPEDS) identifiers from the National Center for Education Statistics (NCES). For the purposes of the NCSE, MSIs are defined as “colleges and universities serving a large percentage of minority students.”
The annual NCSE provides a comprehensive overview of investment performance, governance and management practices, across hundreds of U.S. college and university endowments and affiliated foundations. The findings reflect data from the fiscal year spanning July 1, 2023, through June 30, 2024 (FY2024). MSIs represent $122.5 billion of the $873.7 billion in total assets reported in the full FY2024 Study. The average endowment size for MSIs was $1.3 million, compared to $1.3 billion for the overall NCSE cohort.
What follows is a comparative analysis of the MSIs and the full cohort of 658 NCSE respondents. Note: The full NCSE dataset includes a wide range of institution types, such as private and public colleges and universities, institutionally-related foundations (IRFs), and combined endowment/foundations. A detailed breakdown of these institution types is available in the full report.
THE TOP-LINE RESULTS
Performance
The 97 MSIs participating in this year’s Study reported a 1-yr. average return of 11.6 percent vs. 11.2 percent reported by the total NCSE respondents’ cohort. Over the three-, five- and 10-year periods average returns for MSIs were 3.2, 8.0 and 6.7 percent, respectively, vs. 3.4, 8.3 and 6.8 percent for total NCSE respondents. For longer-term periods, 15-, 20- and 25-years, returns remained positive across both groups - MSIs reported returns of 8.0, 6.6 and 5.3 percent compared to 8.2, 6.9 and 6.1 percent for all NCSE respondents, respectively.
Asset Allocation
The 97 MSIs participating in FY2024 reported a more than 4 percent overweight to private equity compared to the total respondents’ cohort – 21.3 percent vs. 17.1 percent. Other asset classes that MSIs had an overweight to vs. total NCSE respondents were global equities (11.1 percent vs. 8.3 percent) and fixed income (11.7 percent vs. 10.2 percent). Notable underweights, compared to total NCSE respondents, were reported by MSIs in U.S. equities (10.9 percent vs. 13.0 percent) and non-U.S. equities (3.9 percent vs. 5.6 percent). These differences reflect distinct investment strategies and risk profiles among MSIs, potentially shaped by differing institutional goals, resources, and return expectations.
Spending
In FY2024, MSIs reported an average annual effective spending rate of just 4.1%, compared to 4.8% for the total NCSE respondent group. This gap underscores differing levels of endowment reliance and spending capacity across institutions.
When it comes to spending policy, the most commonly used methodology among MSIs was a percentage of a moving average—reported by 77.3 percent, closely aligning with the 76.3 percent of total NCSE respondents that reported using this method. The second most frequently used method was the weighted average or hybrid approach, used by 9.3 percent of MSIs and 10.1 percent of all respondents. Additionally, a notable portion of institutions selected “Other” to describe their spending methodology—8.2 percent of MSIs and 11.6 percent of total respondents—indicating a range of alternative or customized approaches in use.
Gifts
FY2024 saw a significant increase in average new gifts to NCSE participants. Total gifts reported by the 658 respondents reached $15.0 billion, up from $12.0 billion in FY2023. Minority-serving institutions accounted for $3.8 billion of that total.
The average amount of new gifts received by MSIs was $40.4 million, notably higher than the overall average of $24.4 million across all NCSE respondents. However, as is often the case, the median gift size was substantially lower—$4.2 million for MSIs and $5.0 million for all respondents—highlighting the outsized impact of a few exceptionally large gifts during the fiscal year.
Operating Budget Support
In FY2024, minority-serving institutions reported that 10.9 percent of their operating budgets were funded by their endowments, on average. In comparison, the average for all NCSE respondents was 14.0 percent. The gap is even more pronounced at the median level, with MSIs reporting a median endowment contribution of just 2.2% compared to 6.1% among total respondents.
Responsible Investing Practices
While the adoption of responsible investing practices has grown significantly in recent years, a notable gap remains across the nonprofit sector. Forty-six percent of MSIs reported integrating at least one form of responsible investing—such as impact investing, ESG strategies, negative screening, or the use of diverse managers—into their portfolios. In contrast, only 37.5 percent of total NCSE respondents reported doing the same.
Although recent trend data suggests that the rapid growth in adoption of responsible investing may be beginning to level off, we remain committed to tracking this important area. Ongoing research will continue to monitor how responsible investing evolves within the nonprofit sector and its potential to drive mission-aligned impact.
We hope these top-line insights serve as a valuable starting point for your own exploration of these critical issues. To gain a deeper understanding and effectively evaluate your performance against benchmarks and peers, we encourage you to read the full Study.
If you are interested in participating in future research or learning more, please contact us here.
