Monitor Financial Performance and Portfolio Alignment

Aligning the endowment with mission is an iterative process and includes ongoing monitoring of the endowment portfolio in terms of both financial performance and alignment with mission.

1. Measure the Endowment’s Financial Progress

In order to signal their focus on long-term investing, endowments will include a benchmark that matches their endowment's long term financial goals such as an Inflation plus Spending benchmark. An intentional endowment may also choose to benchmark financial performance against an index that reflects its investment policy more closely. 

In addition to the standard broad market benchmarks, many index leaders now offer ESG and mission-aligned benchmarks such as Low Carbon, Catholic Values and Women Leader indices that can be added as secondary benchmarks. For more information on some specific benchmarks:


2. Measure Endowment Alignment with Mission

Endowments can use some of the same tools that were used in the original portfolio assessment to continue to monitor progress in aligning the endowment with the institution’s mission on a regular interval (annual or more frequent). Review those steps and tools for measurement here.


3. Use a Comprehensive Portfolio Impact Monitoring Framework

Read IEN’s five-step guide to implementing comprehensive impact management across your portfolio here. The guide points you to resources for learning more about impact management, setting impact goals, selecting the most relevant metrics and collecting data on them, analyzing that data and reporting your findings. Or take a quick look at two examples that are gaining traction with endowments and foundations:


The Impact Management Project (IMP) 

The Impact Management Project (IMP) aims to provide consensus on how to talk about, measure and manage impact, bridging the perspectives of 700+ investment, grantmaking, business, non-profit, social science, evaluation, wealth management, policy, standard-setting and accounting practitioners (among others). "Figuring out what you think your capital can likely achieve through your diversified fiduciary portfolio is the most important thing."    - Brian Telstad, Partner, Bridges Fund Management

Watch an IEN webinar on the Impact Management Project

Global Endowment Management Case Study with The Impact Management Project 

In 2019, Global Endowment Management (GEM) partnered with Bridges Impact+ Advisory Arm to adapt and apply the IMP framework to GEM’s ~$10 billion endowment-style portfolio. GEM engaged in a thorough assessment of investment strategies, including (a) the impact of portfolio companies on key stakeholders, and (b) each investment manager’s contribution to impact

Read Impact Management for Complex Portfolios: A Primer for Applying the Impact Management Project Framework to a Globally Diversified, Multi-Manager Portfolio

The Investment Integration Project (TIIP) 

Measuring Effectiveness: Roadmap to Assessing System-level and SDG Investing, examines how investors can chart a course to assess system-level issues (like those contained in the SDGs) appropriate for their specific situation, and then establish effective goals for influence against which to measure progress. In doing so, investors also can assess the potential usefulness of the tools available to them and the effectiveness of the tools they have selected. Ultimately, this approach enables investors to assess their influence in determining changes at the system-level itself and the potential contribution of their efforts and investments. The report is authored by William Burckart, Steve Lydenberg and Jessica Ziegler of The Investment Integration Project (TIIP) and was sponsored by the Investor Responsibility Research Center Institute (IRRCi).

A companion document to the report, Measuring Effectiveness: Roadmap to Assessing System-level and SDG Investing-Supplemental Appendices, contains a series of appendices that provide tools and examples for investors, as well as additional context for and information about the concepts discussed

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