Endowment Report 2023 | University of Rochester

1 ENDOWMENT REPORT 2023 | UNIVERSITY OF ROCHESTER

ON THE COVER The Statue of Industry: Together with the Statue of Athena, the Statue of Industry has watched over the grand staircase in Rush Rhees Library since the River Campus opened in 1930. She holds a wheel under her right hand, carries a lamp in her left, and a small cog rests beside her—an inspiration to generations of students. 2

3 CONTENTS Endowed giving is one of the most powerful ways to make an impact. It provides perpetual, vital support for our students, faculty, research, and academic and clinical programs. It also creates a lasting legacy for the programs that are important to you. Your philanthropy sustains and inspires us and all those we serve. 04 | MESSAGE FROM PRESIDENT SARAH C. MANGELSDORF 06 | BY THE NUMBERS 08 | STORY OF IMPACT Pitch perfect and much more: Talent, drive, and an unstoppable spirit fuel the ambitions of Ashni M. Budge ’24, ’24E, a recipient of multiple scholarships 14 | FINANCIAL UPDATE 18 | INVESTMENT COMMITTEE AND ETHICAL ADVISORY COMMITTEE ROSTER

4 THANK YOU The University of Rochester’s endowment elevates the work we do and the people and communities we serve. Your giving is much more than a financial commitment—it’s a visionary investment in our shared academic and public mission: to make the world ever better, now and forever. We are grateful for all you do for this institution. Your philanthropy propels the pursuit of knowledge, nurturing scholarship across diverse fields. Your commitment sparks curiosity, fosters innovation, and creates exceptional learning experiences and groundbreaking research discoveries across all corners of our campuses. Your impact also extends to our health care network, ensuring compassionate care for those in need. Because of you, we can continue to cultivate a culture where big ideas thrive, the wildest ambitions are within reach, and possibilities flourish. You make it possible for us to enroll talented and deserving students; pursue research of global consequence; provide healing and hope to our community; and inspire the kind of creativity that resonates for generations. On behalf of everyone here, thank you. SARAH C. MANGELSDORF PRESIDENT, G. ROBERT WITMER, JR. UNIVERSITY PROFESSOR

5 Bronze figure from Tom Otterness’s “Creation Myth” installation at the Memorial Art Gallery’s Centennial Sculpture Park

6 Detail from Jay Yan's "Mural for Two Walls" inside the Sloan Performing Arts Center on the River Campus

7 BY THE NUMBERS In 2023, the combined power of endowed support advanced educational programs, fostered innovation, and created lasting impact for future generations. $2.8 billion The combined market value of our endowment *As of June 30, 2023, total endowment spending for the University was $135 million. $118 million Endowment support for students, faculty, and programs * 2,920 Total number of funds that made up the endowment 1,972 Donors who made gifts to 578 endowed funds 678 First-time donors to endowed funds

8 By the time Ashni Budge arrived at the Eastman School of Music, she’d already dedicated most of her life to music. She started playing the violin at just three years old. When she was five, she added the piano to her repertoire. At about that same time, Budge’s family discovered that she had perfect pitch. Budge attributes that to her grandmother, a professional Chinese opera singer. “She taught my younger brother and me to sing,” says Budge, who grew up outside of Los Angeles. “I have vivid memories of the two of us performing and of me putting on operas for our family.” In middle school, Budge joined the band and, even though it didn’t have a string section, she wasn’t deterred. That’s when she picked up the clarinet, which she continued playing throughout high school. She joined the choir, too. When it came time to decide on a college, Budge knew Eastman was for her. She was drawn to its renowned reputation and that it is part of the University of Rochester, a leading private research university with a flexible undergraduate curriculum. She was also excited to travel and live on the other side of the country. Being a scholarship recipient has made it all possible for Budge. “Without the generosity of others, I couldn’t afford to be here,” she adds. “I can’t believe that people who don’t even know me have provided me with scholarships. Someday, I hope to help others in a similar way.” PERFECT PITCH and MUCH MORE: Talent, drive, and donor generosity fuel the ambitions of this scholarship recipient

9 Ashni M. Budge ’24, ’24E Recipient of multiple scholarships, including significant support from the Joyce Osborn Violin Scholarship, made possible through the generosity of Joyce Osborn and the Wegman Family Scholarship Challenge.

In the meantime, Budge is taking advantage of every opportunity. Not only is she an applied music major studying violin at Eastman, she is also a psychology major and brain and cognitive sciences minor at the University’s School of Arts & Sciences. Along the way, she’s performed in liveto-picture renditions of Danny Elfman’s Batman, cofounded a string quartet with friends, called the Avant Quartet, and earned the prestigious position of concertmaster for the Eastman Philharmonia. Budge has been recognized for her academic achievements, too. She’s on the 10 Without scholarship support, I probably never could have attended Eastman. Thus, the thought of giving someone else the opportunities I had rose in my mind. That’s why I set up this scholarship, to help wonderful young musicians like Ashni get an Eastman education. I’m so impressed by her and am overjoyed that I can help. —JOYCE OSBORN ’54E dean’s list and was inducted into Psi Chi, the International Honor Society for psychology students, as a sophomore. In 2022, Budge and her quartet participated in what’s become a life-changing experience for her: Eastman-to-Go. This one-semester chamber music course provides select ensembles opportunities to bring music into the Greater Rochester community, with a focus on presenting classical music to new, young audiences. Budge loved it, and so did the people with whom she interacted. For instance, at the Dr. Charles T. Lunsford School No. 19, one of the schools they visited, Budge’s influence was so significant that she was invited back for the 2023–24 academic year to give violin lessons to fifth graders. “Working with them has been among the best experiences of my life,” says Budge. “We even played a few pieces with the Rochester Philharmonic Orchestra over the winter holidays, which was a thrill for us all.” Next up for Budge? In the short term, she’s practicing for a Sibelius violin concerto and a performance of Schubert’s Cello Quintet in C Major. Long term, she hopes to go to graduate school for music. She’s even considering law school someday. Whatever Budge does, she knows music will always play a part. She adds, “Music has always given me an outlet, a way to express my feelings. As long as my life has music in it and involves some performing and watching people grow and develop, I’ll be happy. Thank you to all of the people who have supported me along the way— I’m forever grateful.”

WITHOUT THE GENEROSITY OF OTHERS, I COULDN’T AFFORD TO BE HERE. I CAN’T BELIEVE THAT PEOPLE WHO DON’T EVEN KNOW ME HAVE PROVIDED ME WITH SCHOLARSHIPS. SOMEDAY, I HOPE TO HELP OTHERS IN A SIMILAR WAY.” 11 Budge and Nicholas Garcia-Hettinger ’24E, a Hamlin Family Scholarship Fund recipient, in the Wolk Atrium, Eastman School of Music —ASHNI BUDGE

12 MUSIC HAS ALWAYS GIVEN ME AN OUTLET, A WAY TO EXPRESS MY FEELINGS. AS LONG AS MY LIFE HAS MUSIC IN IT AND INVOLVES SOME PERFORMING AND WATCHING PEOPLE GROW AND DEVELOP, I’LL BE HAPPY. THANK YOU TO ALL OF THE PEOPLE WHO HAVE SUPPORTED ME ALONG THE WAY— I’M FOREVER GRATEFUL.” —ASHNI BUDGE

13 The Wegman Family Scholarship Challenge In recognition of the Eastman School of Music’s commitment to the next generation of leaders in music and the performing arts, the Wegmans Family Foundation established a $2 million scholarship challenge to encourage the creation of new endowed scholarships. Since 2021, nearly $6 million has been raised through the 46 scholarships established during the Wegman Family Scholarship Challenge, including the Joyce Osborn Violin Scholarship. Thank you to the Wegmans and the many donors who joined the Wegman Family Scholarship Challenge. Together, they are supporting the next generation of artists and leaders who will inspire audiences and transform lives through music. —JAMAL ROSSI Joan and Martin Messinger Dean, Eastman School of Music Nicole, Danny, and Colleen Wegman of the Wegman Family Charitable Foundation

14 THANK YOU FOR YOUR SUPPORT OF THE UNIVERSITY. The University of Rochester’s endowment funds, now numbering more than 2,900 with a value of more than $2.8 billion, perpetuate a key source of revenue for the University. Over $135 million is expended each year from these endowment funds for faculty support, student scholarships, and programs. The Investment Committee and the University’s Board of Trustees take a long-range view of the endowment to ensure support of both current and future generations of our faculty and students. The endowment’s well-diversified investment portfolio and prudent spending policy serve to balance the present with the future. Endowment funds are pooled together for investment purposes and are managed by many of the world’s most well-regarded investment firms. Investment performance of these firms, combined with giving by generous donors, helps to ensure the continued financial viability of the University. On behalf of our students and faculty, we thank you for your support. FINANCIAL UPDATE NAVEEN NATARAJ ’97 DOUGLAS W. PHILLIPS Chair, Board of Trustees Investment Committee Senior Vice President and Chief Investment Officer

15 As of June 30, 2023 (fiscal year-end 2023), the University of Rochester’s Long-Term Investment Pool (LTIP) was valued at $3.3 billion. Endowed funds from the University’s programs represent approximately $2.8 billion of the LTIP.* Each fund benefits from scale and diversification of the LTIP. The University is one of 50 colleges and universities in the United States with an endowment of more than $2 billion. The LTIP outperformed the benchmark (80% stocks and 20% bonds) for three-, five-, and ten-year periods. Rochester’s fiveyear average net annual investment return was 8.1% versus LONG-TERM INVESTMENT POOL VALUE (Primarily endowment, dollars in billions) 1.25 1.14 1.13 1.26 1.39 1.52 1.77 1.75 1.37 1.47 1.66 1.65 1.81 2.13 2.23 2.12 2.35 2.51 2.58 2.61 3.71 3.22 3.32 00-01 01-02 02-03 03-04 04-05 05-06 06-07 07-08 08-09 09-10 10-11 11-12 12-13 13-14 14-15 15-16 16-17 17-18 18-19 19-20 20-21 21-22 22-23 6.9% for the benchmark. The ten-year average net annual return was 8.3% versus 7.5% for the benchmark. During the fiscal year ending June 30, 2023, the LTIP return was 6.9%, compared to the benchmark return of 13.4%. *Other funds held in the LTIP include trusts, annuities, supporting organizations, foundations, and reserves. LONG-TERM INVESTMENT POOL

16 Rochester’s portfolio is divided into 38% traditional publicly traded assets—stocks and bonds—and 62% non-publicly traded investments, such as private equity, hedge funds, and real estate, referred to as “alternative investments.” This approach has ensured growth during economic expansions and capital preservation in economic downturns, with volatility far below the benchmark. Major asset classes generated the following performances in fiscal year 2023 (net of fees): ASSET ALLOCATION as of June 30, 2023 ASSET ALLOCATION AND RETURN Publicly traded equity generated a net return of 17.1% compared to 16.5% for the global stock benchmark. Opportunistic funds returned 18.6% and international equity returned 16.2%. Alternative investments generated a net return of 2.0%. Hedge funds returned 7.8%, private equity funds returned -0.4%, and real asset funds returned 2.1%. Bonds and cash returned 2.4% compared to the 0.5% return for the bond/cash benchmark. 3.7% Fixed Income 1.3% Real Estate 11.4% Buyouts 17.0% Venture 1.7% Distressed 27.4% Hedge 19.1% International Equity 11.3% Opportunistic Equity 0.8% Mining & Commodities 0.2% Agriculture 1.9% Energy 4.3% Cash

17 The University of Rochester Medical Center endowments comprise the largest component of the LTIP. Arts, Sciences & Engineering and the Eastman School of Music account for the next two largest shares. Endowments of the Simon Business School, Warner School of Education, and the Memorial Art Gallery collectively represent about 6% of the LTIP. Approximately 6% of the LTIP represents unrestricted gifts that are designated by the Board of Trustees as permanent endowment for support of education. Arts, Sciences & Engineering Medical Center Unrestricted Eastman School of Music Simon Business School Memorial Art Gallery Other (Foundations and Affiliates) Warner School of Education 3% 2% 1% 42% 17% 19% 10% 6% LONG-TERM INVESTMENT POOL COMPONENTS The University’s endowment spending policy ensures a growing and sustainable source of revenue for the University’s departments, schools, divisions, and programs, as well as intergenerational equity for all endowment accounts. It also aligns with our peers. The policy contains both inflationbased and market-based components. Spending rates will generally fall between 4% and 6% of the 20-quarter rolling average market value. ENDOWMENT HIGHLIGHTS (largest component of the LTIP) | Dollars in thousands ENDOWMENT MARKET VALUE NET RETURN SPENDING 2023 $2,822,698 6.9% $117,535 2022 $2,739,187 -11.6% $118,928 2021 $3,194,900 41.7% $114,314 2020 $2,328,140 3.7% $110,779 2019 $2,317,560 6.3% $108,053 2018 $2,257,557 10.0% $102,171 2017 $2,121,390 14.3% $102,000

18 VOTING TRUSTEES Jay S. Benet ’76S (MBA) Retired Vice Chair and CFO, The Travelers Companies, Inc. Richard B. Handler ’83 (Ex Officio) Chair, Board of Trustees, University of Rochester CEO, Jefferies Financial Group Curtis J. Johnson ’88 Former Managing Director, The Carlyle Group Carol D. Karp ’74 (Ex Officio) Vice Chair, Board of Trustees, University of Rochester Chief Regulatory Officer, Prothena Biosciences Inc. Amy Lesch ’93 Partner, Head of Global Product Strategy, KKR Sarah C. Mangelsdorf (Ex Officio) President, G. Robert Witmer, Jr. University Professor, University of Rochester Naveen Nataraj ’97 (Chair) Co-Head of Investment Banking, US, Evercore LIFE TRUSTEE EX OFFICIO MEMBERS Roger B. Friedlander ’56 Retired Business Executive Robert B. Goergen ’60 Founder and President, The Ropart Group Edmund A. Hajim ’58 Chair, HighVista Strategies LLC Michael E. Jones ’76 Chief Investment Strategist, High Probability Advisors Robert J. Keegan ’72S (MBA), ’10S (Honorary) Retired Business Executive Louis G. Lange ’70, MD, PhD General Partner, Asset Management Ventures Martin E. Messinger ’49 Senior Advisor, The Messinger Group, Neuberger Berman Robert M. Osieski ’77, ’78S (MBA) Retired Managing Director, J.P. Morgan Michael S. Rosen ’82, ’83S (MBA) Co-Chair and Chief Executive Officer, Context Capital Management, LLC Ralph R. Whitney, Jr. ’72, ’73S (MBA) Chair Emeritus, Hammond, Kennedy, Whitney & Co. Janice M. Willett ’78S (MBA) Retired Editor, The Boston Consulting Group ALUMNI EX OFFICIO MEMBERS John E. Conlin ’80 Founding Partner, Veradace Partners Pramit Jhaveri ’87S (MBA) Board of Trustees, Senior Advisor, Premji Invest and PJT Partners Richard T. Miller ’91S (MBA) Group Managing Director, TCW Direct Lending Group Daniel M. Ng ’89S (MBA) Retired Business Executive Paul E. Singer ’66, ’17 (Honorary) Founder, President, Co-Chief Executive Officer, Co-Chief Investment Officer, Elliott Investment Management L.P. INVESTMENT COMMITTEE MEMBERS As of January 1, 2024 Dan Apfel ’05 University alumnus Karen Berger Associate Professor of Instruction, Department of Earth and Environmental Sciences Daniel Burnside Clinical Professor, Simon Business School William FitzPatrick (Chair) Gideon Webster Burbank Professor, Department of Philosophy Katherine Gregory ’21 (MS) PhD candidate Sybilla Moore ’24 Undergraduate student Douglas Phillips (Ex Officio) Senior Vice President and Chief Investment Officer Molly Snyder Project Manager University IT The University’s Ethical Investment Advisory Committee (EIAC) consists of faculty, staff members, and undergraduate and graduate students. EIAC’s purpose is to identify areas of potential concern and investigate the consonance of the University’s investment policies and values. Where appropriate, EIAC makes recommendations to the Board of Trustees’ Investment Committee regarding particular investments, communications, and proxy votes. ETHICAL INVESTMENT ADVISORY COMMITTEE MEMBERS

19 Strong Memorial Hospital’s original entrance, which is now part of the University of Rochester School of Medicine and Dentistry

20 Donor Engagement Office Larry and Cindy Bloch Alumni and Advancement Center P.O. Box 278710 | Rochester, NY 14627 If you have questions about this report, please contact Leslie Zornow, Executive Director of Donor Engagement | leslie.zornow@rochester.edu

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