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Endowment Board University of North Carolina. Wilmington April 3 , 2014. 1. 2. Endowment Board University of North Carolina Wilmington. Thursday, April 3, 2014 at 3:00 pm Masonboro Island Room, Fisher Student Center Agenda. Welcome Ms. Wendy Murphy

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endowment board university of north carolina wilmington

2

Endowment BoardUniversity of North Carolina Wilmington

Thursday, April 3, 2014 at 3:00 pm

Masonboro Island Room, Fisher Student CenterAgenda

Welcome Ms. Wendy Murphy

Approve Minutes of October 24, 2013 Ms. Wendy Murphy

Results of FY 2013 NACUBO Endowment Study Ms. Roberta LaSure

Endowment Portfolio at February 28, 2014 (unaudited) Ms. Roberta LaSure

Endowment Performance Returns through February 28, 2014 Ms. Roberta LaSure

Request for Proposal: Investment Consulting ServicesMr. Charles Maimone/Dr. Rick Whitfield

Update: BOG Approval of UNCW Request of a For-Profit

Associated Entity Mr. Rob Hoon/Mr. Charles Maimone

Closed Session Mr. Charles Maimone

Adjournment Ms. Wendy Murphy

slide3

3

2013 NACUBO Endowment Study

For the Year Ended June 30, 2013

nacubo endowment study overview
NACUBO Endowment Study Overview
  • 835 U.S. endowments and affiliated foundations participated in the 2013 NACUBO-Commonfund Study of Endowments (NCSE)
  • All data is through June 30, 2013
  • The breakdown of participating institutions is by size below
slide10

10

ENDOWMENT PORTFOLIO INVESTMENT STATEMENT

At February 28, 2014

slide14

14

ENDOWMENT INVESTMENT PERFORMANCE RETURNS

Through February 28, 2014

slide17

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INVESTMENT COMMITTEE INTIATIVES

background investment committee initiatives
Background: Investment Committee Initiatives
  • Results of combined efforts of Endowment & Foundation Investment Committees over past few years:
    • Updated and revised Investment Policy Statement (IPS)
    • Systematic review of asset allocation at portfolio level
    • Refined Investment Performance Report against benchmarks
  • Committees recommended UNCW staff’s next project be an assessment of our current investment management structure relative to spectrum of services offered in marketplace
uncw endowment at a glance
UNCW Endowment at a Glance

Endowment

  • Total investable assets of $76M for University and $3M for Foundation
  • Currently utilizing “hybrid” approach
    • Two outsourced CIO managed funds – UNCMC and TIFF, representing 73% of assets
      • UNCW is “little fish in big pond” – receive little attention from managers
      • Structure of each managed pool is a “fixed menu” – no customization
    • Two direct mutual fund investments with GMO, representing 23% of assets

Endowment Board

  • 7 Trustees
  • Quarterly meetings

UNCW Staff

  • VC of Business Affairs, Associate VC Finance & Director of Endowment Accounting
catalysts for change in oversight management
Catalysts For Change in Oversight & Management

Issues Facing Institutional Investors

  • Progressively more complex and volatile markets
  • Increased complexity in strategies and financial instruments
    • Increased time and expertise required for proper oversight
  • Expectations of a potentially lower return environment
  • Growing emphasis on risk adjusted performance returns

Issues Facing Smaller & Mid-Size Universities

  • Limited resources to develop in-house investment capabilities
  • Lack economies of scale
  • Building donor confidence

Issues Facing University Investment Committees

  • Trustee Succession – loss of continuity as trustees roll off committees
  • Active asset management no longer a desirable role
  • Focus on governance and policy; reviewing asset allocation and performance returns against benchmarks
participants in process
Participants in Process
  • Endowment & Foundation Board member participants in this process:
    • Britt Preyer
    • Edward Alexander
    • Steve Warwick
    • Hank Miller
    • Jason Wheeler
    • Chad Paul
    • David Hartness
    • Charles Mattox
    • Robert Keith
  • UNCW Staff participants in this process:
    • Vice Chancellor for Business Affairs
    • Associate Vice Chancellor for Finance
    • Director of Endowment Accounting
request for information rfi

22

Request for Information (RFI)
  • UNCW issued Request for Information (RFI) in July, 2013 to conduct assessment and gather relevant information on the spectrum of investment consulting services offered in marketplace
  • UNCW staff reviewed all 40 responses and recommended on-campus visits from 3 firms whose core client base consist of higher education institutions, who offer full range of discretionary services, and who are not a subsidiary of a larger holding company
  • Visits from following (3) firms completed on January 15, 2014:
    • Fund Evaluation Group
    • Hirtle Callaghan
    • Cambridge Associates
slide23

23

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slide24

24

ThreeCommonOCIOModels

Singlecommingledfund

Ex: UNCMC, TIFF

Multiplecommingled funds

Multiple direct investments

Noownershipof managers

Complex administration

Cashin/cashout

Not Customized

Fully Customized

next steps request for proposal
Next Steps: Request for Proposal
  • Investment committee members and other Board participants recommended issuing a Request for Proposal for outsourced Chief Investment Officer (CIO) services with full discretion
endowment board university of north carolina wilmington1

26

Endowment BoardUniversity of North Carolina Wilmington

Thursday, April 3, 2014 at 3:00 pm

Masonboro Island Room, Fisher Student CenterAgenda

Welcome Ms. Wendy Murphy

Approve Minutes of October 24, 2013 Ms. Wendy Murphy

Results of FY 2013 NACUBO Endowment Study Ms. Roberta LaSure

Endowment Portfolio at February 28, 2014 (unaudited) Ms. Roberta LaSure

Endowment Performance Returns through February 28, 2014 Ms. Roberta LaSure

Request for Proposal: Investment Consulting ServicesMr. Charles Maimone/Dr. Rick Whitfield

Update: BOG Approval of UNCW Request of a For-Profit

Associated Entity Mr. Rob Hoon/Mr. Charles Maimone

Closed Session Mr. Charles Maimone

Adjournment Ms. Wendy Murphy

endowment board university of north carolina wilmington2

27

Endowment BoardUniversity of North Carolina Wilmington

Thursday, April 3, 2014 at 3:00 pm

Masonboro Island Room, Fisher Student CenterAgenda

Welcome Ms. Wendy Murphy

Approve Minutes of October 24, 2013 Ms. Wendy Murphy

Results of FY 2013 NACUBO Endowment Study Ms. Roberta LaSure

Endowment Portfolio at February 28, 2014 (unaudited) Ms. Roberta LaSure

Endowment Performance Returns through February 28, 2014 Ms. Roberta LaSure

Request for Proposal: Investment Consulting ServicesMr. Charles Maimone/Dr. Rick Whitfield

Update: BOG Approval of UNCW Request of a For-Profit

Associated Entity Mr. Rob Hoon/Mr. Charles Maimone

Closed SessionMr. Charles Maimone

Adjournment Ms. Wendy Murphy