Foundations and Charities See Drop in Investment Returns

After strong investment gains in 2010, foundations and charities saw their returns decline last year, Pensions & Investments reports, citing the results of two studies by the Commonfund Institute.

Foundations lost 0.9 percent on their investments in fiscal year 2011 after gaining 12.5 percent the year before. For operating charities, the loss was 1.8 percent compared with an increase of 11.6 percent the previous year.

“On top of negative investment returns, the addition of inflation and investment management costs means that these institutions fell a little farther behind financially, even before spending for mission support,” said John S. Griswold, Commonfund’s executive director.

The Commonfund studies assessed the financial performance of 179 foundations and 68 cultural, religious, and social-service charities.