Northwestern sees significant endowment growth in Fiscal Year 2013

Amy Whyte, Development Editor

Northwestern’s endowment grew to $7.8 billion in Fiscal Year 2013, an increase of 9.2 percent from the previous year.

The fund grew much faster than it did in FY2012, which saw a modest 2.5 percent increase. Will McLean, NU’s chief investment officer, attributed the performance primarily to favorable market conditions and a strong investment portfolio.

“We outperformed pretty nicely over the last 12 months,” McLean said, “both in the U.S. and international markets.”

The 2013 financial report, released earlier this year, details the University’s financial activities over the course of the FY2013, which spanned from September 2012 to August 2013. During that time, NU’s investment portfolio grew 11.6 percent, according to the report. 

McLean said NU outperformed especially in equities, such as publicly traded stocks, as overall markets improved in both the U.S. and abroad. Domestic market value increased 24 percent over the fiscal year, while international markets improved by 18 percent. 

“Those things were really driving that performance,” he said.

Since the fiscal year ended, McLean said, the endowment has increased even more dramatically to its current worth, about $8.7 billion, growing by almost a billion dollars in about five months.   

McLean attributes the more recent increase to the investment of proceeds from Lyrica, an anti-seizure drug developed by NU researchers, as well as the sale of the Northwestern Medical Faculty Foundation to Northwestern Memorial Healthcare. 

“For now, the news is pretty positive,” he said.

McLean said the endowment had improved in comparison to other universities.

Additional increases to the endowment can be attributed to alumni giving. According to the Office of Alumni Relations and Development, alumni donated a total of $104 million in the 2013 fiscal year, with $28 million in donations going to the endowment. 

Eugene Sunshine, NU’s senior vice president for business and finance, wrote in the financial report that both gifts and endowment earnings support the University’s overall goal of maintaining balanced revenue sources.

“While Northwestern is not immune from the challenges currently facing higher education in general, and private research institutions in particular … it is well positioned to respond to them while advancing the important goals and objectives of its strategic plan,” he wrote. 

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Twitter: @amykwhyte

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