By investing in securities, the University aims to increase its assets and to ensure a steady and predictable cash flow to fund its core duties.
The securities are divided into two portfolios, those of the University of Helsinki and the University of Helsinki Funds. The investments are managed by external asset managers who are bound by the investment principles set by the University Board.
At the end of 2015, the total value of the portfolios amounted to 366 million euros. About one-third of this, i.e., 115 million euros, came from the investment of donated funds.
The University’s portfolio
Donations accumulated between 2010 and 2011 constitute the basic capital, totalling 64 million euros, of the University of Helsinki’s securities portfolio.
In the long term, the University expects an annual return of 4–6% from its portfolio. Since the summer of 2013, the basic allocation of the portfolio has been as follows: interest 50%, shares 45% and alternative investments 5%. In the summer of 2016, the University placed over 50 million euros into a liquidity portfolio, which raised the fixed-income weighting of the original portfolio to 53%.
In 2016 the investment portfolio yielded a return of 5.8% (4.7% in 2015 and 9.5% in 2014).
The five-year return on the portfolio was 42.18%, with the annual return being 7.2% (from 2012 to 2016).
Annual allocations from the returns on the portfolio have been made as follows: 2 million euros in 2012 and 3.35 million euros between 2013 and 2016, amounting to 15.4 million euros.
At the end of 2016, the total value of the portfolio was 263 million euros (232 million in 2015).
Development of the University of Helsinki portfolio from 2010 to 2017 in euros
University of Helsinki Funds’ portfolio
The assets of University of Helsinki Funds have accumulated over a long period in the form of donations (€49 million) as well as proceeds from investments.
In the long term, the University expects an annual return of 4–6% from the portfolio. Since the summer of 2013, the portfolio’s strategic allocation has been the following: interest 30%, shares 40%, and alternative investments 30%.
In 2016 the portfolio yielded a return of 5.8% (2015: 4.7% and 2014: 9.5%).
The five-year return of the portfolio was 44.26% with the annual return being 7.5% (2012–2016).
At the end of 2016, the overall value of the portfolio was €128 million (€135 million in 2015).
Development of the University of Helsinki Funds portfolio from 2010 to 2017 in euros
Responsibility in investment
All of the University of Helsinki’s operations must be in line with its values of social responsibility. The University avoids making direct investments in targets which conflict with legislation or international human rights agreements.
As a responsible investor, the University practices good governance, which involves sufficient documentation of investment decisions and the investment process.
The University of Helsinki is a long-term investor, and it seeks to ensure that its investments yield good returns and positive performance over a long period. A responsible company which considers environmental and social factors and complies with good corporate governance is a better investment in the long term due to its enhanced risk management and awareness of new business opportunities.
In its investments, the University of Helsinki primarily employs asset managers who take responsibility and sustainability into consideration. The principles of responsible investment will always be considered when making new investments and concluding asset management agreements. The goal is that all asset managers employed by the University of Helsinki are committed to the UN’s principles of responsible investment. In addition, the University requires annual or more frequent ESG reporting from its asset managers.