Donations to Aalto University in 2021
Donors are a vital part of Aalto University community. Donations advance the purpose of our university and strengthen its long-term financial sustainability. The role of Aalto University Endowment is to manage the received donations and safeguard the intergenerational equity of the university. The impact of the funding from the endowment to the university’s research and education is significant, currently covering about 8% of Aalto University’s total operating budget. The funding secures the continuation of high-quality education and research activities, counter-balancing the long-term erosion of the university’s public funding base.
During 2021, Aalto University Endowment received €13M (€3M)* new donations, of which €6M (€1M) were capitalizing and €7M (€2M) expendable donations. Donations were recorded in restricted funds. Of the donations, 73% were targeted to the field of technology, 24% to business and 3% to art and design. The total number of donors in 2021 was 481 (155), marking a 210% increase from the year 2020.
During 2021, Aalto University Endowment provided €33M (€37M) funding to the university operations. Spending from the general endowment fund was €27M (€31M), allocated to education and research activities based on the university internal funding model. As an example, with this amount the salaries of roughly 180 professors or almost 1,500 research publications could be funded per a year. Spending from the restricted funds was €4M (€4M), the most significant funding being directed to Bioinnovation Center, development of Schools of Technology as well as doctoral education in water engineering.
At the end of 2021, the value of the endowment assets was €1,373M (€1,177M), of which assets in endowment portfolio were €1,357M (€1,167M) and cash assets were €16M (€10M).
The value of the general endowment fund, providing funding for the long-term development of the university, was €1,276M (€1,091M). It consisted of donations of €200M (€200M), capitalization received from the Finnish government of €525M (€525M), and €550M (€365M) of accumulated return, including accumulated university inflation of €161M and accumulated real return of €390M.
The restricted funds, providing funding for both the current and long-term development needs of a single study field or school, were €71M (€60M) at the end of 2021. Of them, €16M (€12M) were expendable, €56M (€49M) capitalizing and hybrid funds. The long-term capital of Aalto University Endowment is invested in the financial markets.
At the end of 2021, the average return of the endowment portfolio since inception in 2010 was 6.0% per annum, net of fees and costs. In 2021 the total return net of fees was 18.4% (3.7%). The market value of the portfolio at the yearend was €1,356M (€1,167M). In 2021, the financial markets recovered strongly as the impact from the pandemic gradually grew weaker and sound economic support remained in place. Most of the portfolio return came from equity investments while credit and alternative risk investments also contributed positively.
*Figures in parentheses refer to year 2020.