Investment Oversight

For effective investment program oversight, the standard metrics utilized for measuring investment performance are not entirely sufficient for endowments and foundations.

  • Endowments and foundations have a longer-term time horizon to determine the effectiveness of the investment decisions. This typically allows for the inclusion of alternative assets as an un-correlated asset that should dampen the volatility and provide higher returns long-term. Frequently though, alternative assets are illiquid investments and come with much higher fees than most other asset classes. Our research has determined that many of these investments do not deliver the returns and risk mitigation results as promised.
  • Additionally, many endowments and foundations place an emphasis on SRI and ESG goals often in alignment with the institution’s mission. While these goals historically focused on exclusion and produced spotty return outcomes, current styles emphasize the inclusion of these goals into the investment program more directly and the criteria to select the firms to invest in. Identifying the right SRI policy is of significance to the goals of the institution and the results of the investment program.
  • Further, an endowment and foundation are more focused on meeting the spending goals of the institution. We assert that the impact on the ability of the investment program to meet the short- and long- term funding requirements of the institution is crucial. This increases the need to carefully measure the return and risk characteristics of the program and its specific components in light of this overall solutions target.

Our objective approach to investment oversight challenges the status quo and places greater emphasis on studying whether the inclusion of specific investment options and styles is indeed likely to produce the return and risk management goals desired, while also expected to support the overall needs and goals of the institution. PlanPILOT’s investment oversight provides an independent and comprehensive review of the investment program structure and design.

We stand ready to assist the trustees with their fiduciary governance responsibilities over their investment program.