This paper offers considerations for how to manage calls for divestment and raises questions that need to be answered to respond clearly and effectively to divestment requests. To navigate tumultuous times and passionate entreaties, we believe institutions need to lean into good governance.
A growing number of institutions and families are choosing to spend down assets over a limited time, rather than investing in perpetuity. There are valid arguments for—and against—using a spend-down approach to achieve philanthropic and investment goals. This paper provides historical context for spend-down funds, considers nuances for achieving good governance, and suggests an approach for dynamic asset allocation strategy, with case studies as illustrations.
For non-profit institutions, the disruptions caused by the COVID-19 virus, and the speed by which these disruptions have materialized, create a perfect financial storm.