Bowdoin’s endowment is as old as the College, having been established in 1794 with a $1,000 gift from James Bowdoin III.

An endowment is permanent capital restricted for specific purposes by donors that provides a steady stream of funds to support the College’s operations, programs, and initiatives in perpetuity. For Bowdoin, this stream of funds—often called “the spending draw”—is a monthly cash transfer from the endowment to the Treasurer’s Office.

Endowments are not a single fund. They are an aggregation of many individual endowments, each with restrictions set by donors on how the money can be used (e.g., financial aid, athletics, professorships). By law, the principal cannot be spent.

Because endowments exist to support institutions in perpetuity, they are typically managed with a far longer time horizon than that of any living person. Consequently, a significant portion of the capital is typically locked up in less liquid investments with higher targeted returns.

Most of the distributions from the endowment are restricted by donors for specific purposes, the largest of which (46 percent) is financial aid. The second largest (22 percent) is for professorships and instruction, with the remainder restricted to lectureships, the library, technology, and museums.

Less than 20 percent of endowment income is unrestricted, and these funds are used for general support of Bowdoin’s operating budget or designated by the Board of Trustees to support a specific program.

Over the past twenty years, the College has spent, on average, 5 percent of the endowment's value each year to directly support College operations. This payout is approved annually by the Board of Trustees according to the College's spending policy.

The endowment is managed to support both current and future generations of Bowdoin students. Taking more in bad years would limit resources available in the future. Selling assets to fund higher draws during market downturns could also mean realizing investments at depressed values, which would impair the endowment’s long-term value. Furthermore, the endowment is made up of more than 1,900 individual funds, most of them restricted by donors for specific purposes—such as scholarships, academic programs, or faculty support—and intended to be used in perpetuity. Even if more were drawn in a given year, they could not necessarily be directed to areas of immediate need.

Bowdoin’s endowment is managed by a small, experienced in-house investment team. The team is guided and advised by the Investment Committee of the Board of Trustees, the members of which include Bowdoin alumni and parents, a member of the faculty, and the president of the College.

Bowdoin’s Investment Committee includes some of the most successful and seasoned professionals in global finance. Members of the investment team and the Investment Committee are fiduciaries to the College, meaning they are legally obligated to act in the financial best interests of Bowdoin.

The main goals are:

1. to preserve the purchasing power of the endowment through investment performance;
2. to ensure adequate liquidity for Bowdoin’s spending draw and endowment’s own cash needs; and,
3. to manage volatility.

Purchasing power refers to the endowment’s ability to maintain its value net of the College’s spending draw and inflation. Through strong long-term investment performance, Bowdoin has not just preserved but has also grown purchasing power, which directly translates into more resources for the College.

The College invests exclusively through external third-party managers in commingled partnerships alongside other institutions. These investments span multiple asset classes, including equities, bonds, hedged strategies, venture capital, and real estate.

The firms that manage Bowdoin’s endowment are vetted, selected, and monitored by the investment office, with oversight by the Investment Committee.

Legally-binding confidentiality agreements between the College and its investment managers typically prevent public disclosure. Moreover, providing transparency would be challenging, given how the portfolio is constructed. Reporting from managers varies by frequency and depth, and no manager in the portfolio provides real-time holdings-level detail. Since the investment office is not performing underlying security selection, this level of reporting is consistent with best market practices. 

No—Bowdoin could only divest from companies where it holds direct investments (of which there are none). The College cannot divest from individual companies that are part of a fund’s strategy; you are either invested in everything within these funds or nothing. There is no menu option or a separate Bowdoin account that can be customized.

The endowment publishes investment returns each fall when fiscal year-end (June 30th) results are available.

Information from the most recent fiscal year can be found here.