Foundations’ Endowed Portfolios Produced Higher 2023 Returns, Rebounding from 2022 Lows, Council on Foundations-Commonfund Study finds

Press Release

Foundations' Endowed Portfolios Produced Higher 2023 Returns, Rebounding from 2022 Lows, Council on Foundations-Commonfund Study finds

Wednesday, September 4, 2024

One-year returns recovered, OCIO use increased, gifts and responsible investing moderated

WASHINGTON -In the improved market environment of 2023, average annual returns on endowed funds bounced back from the previous year for the 291 foundations surveyed in the annual Council on Foundations-Commonfund Study of Investment of Endowments for Private and Community Foundations® (CCSF; the "Study").

The average 2023 calendar year return on endowed funds for the 182 private foundations participating in the Study was 12.6 percent, a marked increase from the -12.0 percent return reported for 2022. Similarly, for the 109 participating community foundations, the average 2023 return was 14.1 percent compared with -13.3 percent in 2022. Returns for both foundation segments swung more than 20 percentage points for the second year in a row (all return data reported net of fees).

The rebounded 2023 returns bolstered longer-term returns, which reflect foundations' ability to finance their missions and program commitments going forward. Ten-year average annual returns remained steady at 7.1 percent (from 7.3 percent) for private foundations and 6.2 percent for community foundations (from 6.4 percent) in 2023.

"Despite year-to-year volatility in the markets, this year's report shows what we know to be true: private and community foundations are primed and positioned for the long term, and it pays off," Kathleen Enright, President and CEO of the Council on Foundations, and George Suttles, Executive Director of Commonfund Institute, said in a joint statement. Citing steady long-term returns, consistency in asset allocation, and level spending, they said, "We will continue monitoring how institutions respond to these challenges, but we remain confident in the ability of foundations to support their communities, through ups and downs, in the years to come."

With data reported by 291 private and community foundations, representing $126.0 billion in combined assets, the CCSF is the most comprehensive annual survey of its kind. The 2023 Study marks the 12th year that the Council on Foundations and Commonfund Institute, two leading organizations in foundation investment and governance policies and practices, have partnered to produce this research. The Study reports data from private and community foundations separately to reflect the differing structures of the two foundation types and, for deeper analysis, also breaks both types into three cohorts segmented by endowment size.

For more details and to download the report in full, please visit www.commonfund.org.

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About the Council on Foundations
The Council on Foundations is a nonprofit membership association that serves as a guide for philanthropies as they advance the greater good. Building on our 75-year history, the Council supports over 900 member organizations in the United States and around the world to build trust in philanthropy, expand pathways to giving, engage broader perspectives, and co-create solutions that will lead to a better future for all. Learn more about the Council and become a member by visiting www.cof.org.

About Commonfund
Commonfund is a leading asset management firm that empowers educational institutions, foundations, pension funds, family offices, RIAs, and other sophisticated investors to achieve their most important goals. Through our Outsourced CIO business, we provide nonprofits access to world-class investment management solutions. Our CF Private Equity business provides access to private equity investments for both nonprofit and for-profit organizations seeking to diversify their portfolios with private investments. Our Commonfund Institute is among the nation's most trusted sources for relevant, useful, and proprietary data, analytics, and best practices in financial management. All our businesses are united by a relentless commitment to investment performance matched by an equally relentless commitment to the values of trust, transparency, and ethical behavior that have inspired us since our founding more than fifty years ago. For more information visit www.commonfund.org.

About Commonfund Institute
Commonfund Institute is among the nation's most trusted sources for relevant, useful, and proprietary data, analytics, and best practices in financial management. The Institute provides a wide variety of resources, including conferences, seminars, roundtables, and online learning through Commonfund Institute Online. Insights cover topics such as endowments and governance; proprietary and third-party research such as the Commonfund Benchmarks Studies®; publications including the Commonfund Higher Education Price Index® (HEPI); and events such as the annual Commonfund Forum and Investment Stewardship Academy.

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