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Governance and Policy | Articles
On average over the past decade, independent schools participating in the Commonfund Benchmarks Study® of Independent Schools have maintained an asset allocation that stays within a few percentage...
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Governance and Policy | Insights Blog
To more accurately plan for future expenses and budgeting needs most colleges and universities look to the Higher Education Price Index (HEPI). The HEPI is an inflation measure for current business...
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Governance and Policy | Insights Blog
There are fundamental principles of effective endowment management that we have organized into what we call “the 6 Ps of Investment Stewardship”– Purpose, Policy, Process, Portfolio, People and...
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Governance and Policy | Insights Blog
In the midst of a global pandemic, many non-profit business models are being challenged which has put significant pressures on staff, governing boards and committees. These pressures on time and...
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Governance and Policy | Insights Blog
This year has been incredibly difficult. One of the most contentious and turbulent presidential elections and transitions in American History. COVID-19 and the consequential social and economic...
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Governance and Policy | Insights Blog
Despite the fall semester looking much better than the worst-case scenarios contemplated in early summer, higher education in America continues to grapple with the enormous challenges that the...
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Governance and Policy | Insights Blog
During this time of unprecedented challenges, the financial health of colleges and universities is a critical concern. Boards, investment committees, institutional leaders, and their advisors must...
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Governance and Policy | Articles
Some foundations have responded to the call of mission by increasing spending in response to exceptional needs created by COVID-19. But there is a trade-off: the potential erosion of endowment value...
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Governance and Policy | Insights Blog
Best practice for nonprofits is to issue a Request for Proposal (“RFP”) for an investment management partner every market cycle. Typically, that is at least every 7 to 10 years, or as it is...
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Governance and Policy | Insights Blog
At Commonfund, we believe diverse managers offer clients access to investment talent and valuable investment opportunities and therefore should be explored and invested in. Overlooking the merits of...
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Governance and Policy | Articles
William Massy has spent his entire career at the intersection of academia and administration, as a microeconomist; professor, dean and CFO at Stanford University; author; and now, an independent...
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Governance and Policy | Insights Blog
As the world continues to grapple with the social, economic, and public health implications of the current COVID-19 crisis, nonprofit organizations and their boards are working tirelessly to...
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Governance and Policy | Insights Blog
The central document guiding the management of a nonprofit institution’s endowment—essentially, the strategic plan of the investment committee—is the investment policy statement (IPS). The IPS should...
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Governance and Policy | Articles
Intergenerational equity was defined by economist James Tobin in 1974. He wrote, “The trustees of endowed institutions are the guardians of the future against the claims of the present. Their task in...
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Governance and Policy | Articles
The Commonfund Higher Education Price Index® (HEPI) is an inflation index for colleges and universities. It has been calculated since 1983 and includes inflation data going back to 1961. Commonfund...
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Governance and Policy | Insights Blog
Six key words – Purpose, Policy, Process, Portfolio, People, and Perspective – form a framework for effective endowment stewardship. As trustees, investment committee members, and senior management...
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Governance and Policy | Insights Blog
A critically important asset for many nonprofit organizations is their endowment, sometimes referred to by a different name such as long-term investment fund. So important is this pool of financial...
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Governance and Policy | Articles
Once an institution decides to pursue the outsourced CIO or investment office option, it usually leads to the creation of a request for proposal, or RFP. Considering that the outsourced model is a...
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Governance and Policy | Insights Blog
Tom Hyatt is a partner in the Washington. D.C. law firm of Dentons US LLP and an authority on nonprofit governance. This blog is excerpted from a presentation he made recently at the Commonfund...
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Governance and Policy | Insights Blog
Tom Hyatt is a partner in the Washington. D.C. law firm of Dentons US LLP and an authority on nonprofit governance. This blog is excerpted from a presentation he made recently at the Commonfund...
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Governance and Policy | Insights Blog
Christopher K. Merker, PhD, CFA, is a financial advisor and director of Private Asset Management at Robert W. Baird & Co. and an adjunct professor at Marquette University. He is also the co-author of...
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Governance and Policy | Insights Blog
In the last few months, high profile nonprofit institutions have come under intense scrutiny for ethical dilemmas pertaining to the stewardship of resources meant to support mission. This is Part...
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Governance and Policy | Insights Blog
Commonfund Higher Education Price Index (HEPI) data show that inflation for colleges and universities was 2.8 percent for fiscal year 2018, a decline from last year’s 3.3 percent but higher than the...
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Governance and Policy | Articles
Endowments, like the organizations they support, are generally intended to operate in perpetuity. To accomplish this goal, those responsible for endowments—trustees or directors—make decisions based...
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Governance and Policy | Articles
The calamities known as the financial crisis and Great Recession are now a decade in the past. But far from fading into history, the memories remain fresh. And we are reminded of those days regularly...
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Governance and Policy | Insights Blog
Three days after becoming Executive Director of the Commonfund Institute, I found myself at Yale University in New Haven giving welcoming remarks at our annual educational program. Although I will...
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Governance and Policy | Articles
Every year, the NACUBO-Commonfund Study of Endowments® (NCSE) reports new data—on investment returns, asset allocation, risk management, donations and gifts, and much more. But some data points are...
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Governance and Policy | Insights Blog
2017’s tax legislation is the latest in a growing list of challenges facing higher education. The new excise taxes on endowment earnings of the largest private universities, coupled with the...
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Governance and Policy | Articles
Since our founding in 1971, a core element of the Commonfund mission has been to provide insights on a broad range of governance, policy and investment challenges. An engaged governing board is...
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Governance and Policy | Insights Blog
It was another taxing weekend (literally) at Commonfund as we digested 1,097 pages of the conference agreement for the tax reform bill (the “Tax Act”) and its implications for our country and for the...
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Governance and Policy | Insights Blog
UPDATE: Since this blog was published there have been further developments related to the Tax Cuts and Jobs Act. Please see our post Tax Cuts and Jobs Act: CPI Plus More for our latest thinking....
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Governance and Policy | Insights Blog
In most Investment Policy Statements there is often a reference to two important, but conflicting, objectives: one, to preserve the purchasing power of the long-term portfolio in real terms, and two,...
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Governance and Policy | Insights Blog
Like nearly everything in the financial markets, risk is cyclical. History repeats itself. The echoes of past crises are always heard in present ones, yet new crises are rarely predicted and not...
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Governance and Policy | Articles
Key Insights While opening opportunity to many New York families, the recently enacted Excelsior Scholarship Program will likely stress the financial resources of small private colleges and...
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Governance and Policy | Insights Blog
Successful investing for long-term funds requires a strategic plan. This is true despite – indeed, because of – the fact that the future is unknowable. The plan must be specific, embodying in...
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Governance and Policy | Insights Blog
Endowed institutions differ in their missions, capabilities and resources, and investment policy statements naturally mirror these differences. In that sense, there is no single ‘right’ investment...
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Governance and Policy | Insights Blog
The structure of a board has an important influence on its effectiveness, and being cognizant of these matters is essential to improving a board’s performance. In this article, we’ll discuss four...
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Governance and Policy | Insights Blog
Excellent boards are made, not born. Achieving excellence in board governance requires success in four crucial areas: capable leadership, a sound organizational structure, attention to fiduciary...
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Governance and Policy | Insights Blog
Treasury managers face a new challenge to an old problem. Their institutions historically have relied on operating investment income to provide a necessary influx to operating budgets. Prior to 2008,...
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Governance and Policy | Articles
How long is the long term? A year ago, private and community foundations appeared to many observers to have recovered from the losses suffered in the 2008–09 global financial crisis. Double-digit...
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Governance and Policy | Insights Blog
With each state having its own court system, uniformity among the states did not exist. While there was agreement on basic common-law trust principles, variations still emerged. As the American...
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Governance and Policy | Insights Blog
Two important laws enacted in the last 15 years have had an impact far beyond the intent of their original authors, causing major, if little-noticed, changes in nonprofit governance. The...
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Governance and Policy | Insights Blog
Most institutional investor discussions and actions regarding global warming have been at two ends of the spectrum: either divest from fossil fuels entirely or remain fully invested. A better...
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Governance and Policy | Insights Blog
Discussions about whether responsible investing strategies help or hurt investment performance are complicated by the fact that, there are several broad categories of responsible investing practice...
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Governance and Policy | Insights Blog
An operating charity in the Northeast is in the process of implementing a risk-based investment policy for its $30 million endowment. The organization’s seven-member Investment Committee includes...
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Governance and Policy | Articles
Most things function a lot better when all the moving parts work together—nonprofit institutions included. The synergies afforded by collaboration across organizational boundaries may be the most...
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Governance and Policy | Insights Blog
Outsourced investment management, once primarily a solution for small institutions with limited resources, is now used by a broad range of long-term investors. When properly implemented, outsourcing...
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Governance and Policy | Insights Blog
Currency risk can best be described as the surprise impact that currency exposure has on an investment portfolio. Although currency risk typically confounds investors, it is easy to measure – it is...
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Governance and Policy | Insights Blog
“Outsourced CIO” (or OCIO) is a term that might not be familiar to many. In the past it has been defined as a traditional consulting model in which the process of interviewing potential investment...
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Governance and Policy | Insights Blog
Developments in world financial markets seem to occur more quickly every year, requiring ever-higher levels of expertise and experience on the part of investment committees. Climate change is a more...
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Governance and Policy | Insights Blog
The following methodology may be of use in helping you to understand more fully what your organization pays for investment management costs. Identify the fees you pay at the overall portfolio level...
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Governance and Policy | Insights Blog
Recently, Commonfund convened an expert panel of investment managers to hold a roundtable discussion and take a closer look at the different impact investing strategies being implemented today. The...
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Governance and Policy | Articles
It is often said that we live in a world of change, but it is surprising how slowly that change can occur. Seven years after the onset of the Great Recession, many business school students are still...
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Governance and Policy | Insights Blog
Generally speaking, Environmental Social and Governance, or ESG for short, is used to describe a group of characteristics that can have a material impact on the long-term success of a company and,...
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Governance and Policy | Articles
Commonfund recently convened an expert panel moderated by Myra Drucker (standing, left), Chair of the Board, TrustedPeer Inc. and former chair of the Commonfund Board of Trustees. The roundtable...
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Governance and Policy | Insights Blog
The regulatory and legislative landscape continues to become more rigorous for nonprofit organizations. In an atmosphere of increasing calls for accountability, boards and senior staff need to take...
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Governance and Policy | Articles
Follow this checklist and you'll be on your way… For nonprofit organizations of all kinds, the regulatory and legislative landscape continues to become more rigorous—which should not come as a...
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Governance and Policy | Articles
Facing cost pressures and a new regulatory regime, healthcare organizations — especially those in the small and mid-sized range — should consider adopting the principles of the endowment model....
Top Five Questions of Nonprofit Fiduciaries