Earlier this year, Commonfund Institute released the 21st annual Commonfund Benchmarks Study of Independent Schools (“CSIS” or the “Study”), reporting on key investment governance trends and insights over the July 1, 2024 – June 30, 2025 fiscal year (FY2025). The CSIS, produced in partnership with NBOA– Business Leadership for Independent Schools, since 2005, is a comprehensive annual survey of investment policies and governance practices of the independent schools’ sector.
Following the release of the FY2025 study, Commonfund conducted an analysis of the 76 participating schools that indicated they have a religious affiliation. The results reflect a comparative analysis between those schools and the 243 total respondents from the full Study. Note: Religious schools included in this analysis are those that self-reported they have a religious affiliation when completing the questionnaire for the Study.
THE TOP-LINE RESULTS
Performance
One-year returns for participating schools in FY2025 were positive across the religious schools’ cohort and the total CSIS respondent group—religious schools reported an 11.3 percent one-year return vs. 11.5 percent for total respondents, on average. All returns referenced are reported by Study participants and represent average net returns for the respective groups. Religious schools under $10 million reported the highest one-year return of 11.8 percent, followed by 11.5 percent for the largest religious schools, and 11.1 percent among the mid-sized cohort, on average.
Looking at the three-, five-, and 10-year returns, both groups of respondents reported similar positive returns—12.0 percent for religious schools vs. 11.4 percent for all schools for the three-year, 10.1 percent vs. 9.6 percent for the five-year, and 7.5 percent vs. 7.7 percent for the 10-year period. Reviewing longer time horizons, religious schools outperformed total respondents over the 15-year period, reporting 8.6 percent vs. 8.2 percent for all schools and 7.3 percent vs. 7.2 percent for the 20-year period, on average.
Asset Allocation
When compared to total respondents, religious schools reported a slight overweight to U.S. equities (37 percent vs. 35 percent) and fixed income (18 percent vs. 14 percent). They also had slight underweights in alternatives strategies (25 percent vs. 30 percent) and non-U.S. equities (16 percent vs. 17 percent). Religious schools with assets over $50 million reported the highest allocation to alternative strategies (29 percent) compared to the dollar-weighted average for total religious schools (25 percent). Meanwhile the smallest religious school cohort allocated nearly half – 48 percent – of their dollar-weighted assets to U.S. equities, compared with 37 percent for total religious schools.
Spending
Religious schools had an average stated policy spend rate of 4.3 percent in FY2025, which is equivalent to the average reported by total schools in the Study. This rate also matched the average for religious schools with assets over $50 million, while those with assets between $10 and $50 million reported 4.2 percent, and those with under $10 million reported 4.6 percent, on average.
Looking at spending methodology, the most common method cited by schools in the FY2025 study was a percentage of a moving average (68 percent of total CSIS respondents vs. 62 percent of religious schools). Eighty-one percent of religious schools with assets over $50 million reported using a moving average methodology, as did 61 percent of those with $10-$50 million, and 31 percent of those with under $10 million. A plurality of smaller religious schools – 44 percent – reported that they decide on an appropriate rate each year.
Gifts
Religious schools reported average new gifts to their endowment of $1.4 million, which is slightly higher than the $1.3 million average for religious schools in FY2024. Meanwhile, total CSIS respondents reported an average of $1.8 million versus $1.6 million in FY2024. By size, religious schools with assets over $50 million reported an average gift of $2.9 million, far surpassing the $0.9 million for those with $10-$50 million and $0.2 million for those with under $10 million, on average.
Operating Budget Support
In FY2025, religious schools reported that an average of 6.8 percent of their operating budget was funded from their endowment, compared with an average of 7.1 percent for total CSIS respondents. Religious schools with assets over $50 million reported that an average of 12.9 percent of their operating budget was funded by their endowment on average, compared with 4.4 percent for those with assets between $10 and $50 million, and 1.4 percent for those with under $10 million, on average.
For religiously affiliated independent schools, sound investment governance is ultimately an extension of mission. By aligning portfolio oversight, spending policies, and fiduciary accountability with the values they espouse, these institutions ensure that their financial practices are as principled as the education they provide, and that their resources remain strong enough to serve students for generations to come.
We hope this research serves as a guidepost for your own analysis and encourage you to read the full Study to better evaluate your performance compared with your benchmark or peers.
