For Immediate Release
WASHINGTON, DC (February 1, 2022)—The Association of Governing Boards of Universities and Colleges (AGB), the premier organization advocating strategic board leadership in higher education, and Strategic Investment Group (Strategic), a pioneer in dedicated Outsourced CIO (OCIO) solutions, today released the second edition of Endowment Management for Higher Education.
Boards have a responsibility to preserve intergenerational equity while helping institutions provide critical financial aid for students and strengthening financial resilience. This resource provides guidance for boards and their investment committees, as well as investment and finance staff of colleges, universities, and institutionally related foundations on effective stewardship of higher education endowments.
Updates to the first edition of Endowment Management for Higher Education, originally published in 2017, are:
- Importance of continually engaging with donors
- Documenting your investment beliefs as part of your Investment Policy Statement
- Importance of a solid foundation of good governance, trust, and communication
- Reviewing the long-term asset allocation each year
- Considerations as you build your investment committee
“While all of our years of engaging with boards have provided us with valuable insights that we shared in the first edition, the initial challenges of the COVID-19 pandemic inspired us to provide more detail in the book around these and other timely topics,” said Nikki Kraus, Strategic Investment Group chief client officer. “For example, we have found that it is important for boards to establish an underwater endowment spending policy. As with a general endowment spending policy, addressing spending from underwater endowments can help ensure that decisions are not unduly influenced by short-term pressures to distribute funds that may have long-term consequences.”
In addition to addressing the full range of endowment management responsibilities, this updated edition includes a new chapter on environmental, social, and governance (ESG) investing. With the growing interest in mission-aligned investing and the increased emphasis on promoting diversity and inclusion in the investment management industry, boards are assessing the benefits of incorporating mission considerations in their investment process.
“In the wake of the increasing demand for values alignment to be reflected in the investment portfolio, many boards are seeking guidance as they weigh the related merits and challenges involved in the process. It is important to recognize that this will be an ongoing journey that adapts to both opportunities and challenges as they arise,” said Valentina Glaviano, Strategic Investment Group managing director. “It is also essential to have clearly defined objectives and a way to monitor progress toward their achievement. An open process of consultation and transparent reporting on implementation will contribute to maintaining support for the endowment and engender confidence in those managing it.”
“As strategic thought partners to chief executives and senior leaders, it is imperative that board members remain strategically engaged when overseeing the endowment to establish and maintain alignment with institutional priorities. This perspective and approach are critical to ensuring long-term institutional vitality,” said Henry Stoever, AGB president and CEO. “We are excited to publish this resource with Strategic, and we appreciate this partnership that’s spanned for nearly a decade to inform, inspire, and empower AGB’s members.”
A similar publication focusing on endowment management for nonprofits outside of higher education is expected later this year.
A complimentary e-book version of Endowment Management for Higher Education is available for AGB members at www.AGB.org/Endowment. Members and non-members can order hard-copy books as well.
The Association of Governing Boards of Universities and Colleges (AGB) is the premier membership organization that strengthens higher education governing boards and the strategic roles they serve within their organizations. Through our vast library of resources, educational events, and consulting services, and with 100 years of experience, we empower 40,000 AGB members from more than 2,000 institutions and foundations to navigate complex issues, implement leading practices, streamline operations, and govern with confidence. AGB is the trusted resource for board members, chief executives, and key administrators on higher education governance and leadership.
Strategic Investment Group®, a pioneer in dedicated Outsourced CIO (OCIO) solutions since 1987, offers a comprehensive service platform for managing customized portfolios for institutional investors. Its proprietary process combines active portfolio management, rigorous risk management, and open architecture manager selection.
Strategic functions as its clients’ investment partner and co-fiduciary, effectively becoming an extension of their resources. Clients are then free to focus on their core missions, while Strategic focuses on providing the highly specialized portfolio management expertise that their clients need to meet their investment goals. Depending on a client’s needs and preferences, Strategic can orchestrate the management of an entire portfolio comprising multiple asset classes, focus on specific asset classes, such as alternatives (e.g., venture capital/private equity, real estate, and/or hedge funds) or international investments, or manage strategies with high potential for adding value. Customized solutions, whether through an integrated total portfolio approach, are also available, as are solutions that address mission-related investment objectives.
Strategic strives to build enduring partnerships with its clients by strengthening their investment programs through a dynamic, value-enhancing investment process, sound governance framework, and world-class client service. Strategic’s mission is to empower its clients to achieve their investment goals.
Strategic had $30.6 billion in discretionary assets under management as of September 30, 2021.