Last week, a Jewish Channel exposé reporterd that YU's board, investment committee and its president, Richard Joel, reportedly squandered much of YU's massive endowment through unethical risky investments that often gave some financial or other benefits to investment committee members. Here is YU's somewhat belated response.
An emial sent to YU students and others by YU's President Richard Joel. (The link, of course, has been added by FailedMessiah.com):
In recent days, you have likely seen various articles about Yeshiva University’s investment performance, debt, and endowment. We stated we will not engage with the media further in this regard, but we believe it is important that you, as critical partners in Yeshiva’s present and future, know some key facts about Yeshiva’s financial situation, investment performance and policies.
Yeshiva University did not lose $1.3 billion since 2007, as alleged. For endowment performance see the chart below. Like many other institutions, we were severely impacted by the 2008 recession, yet chose to continue to build. We continued to invest in developing a first-rate faculty, enhancing the student academic experience, and building the physical infrastructure necessary to deliver that experience.
Beginning in 2009, as part of a comprehensive review of the university’s governance practices, we established new oversight practices for the University’s investments.
o Although our previous conflict of interest policy had been in line with other major universities, with the help of leading experts in the field we enhanced our policy to make it best in class.
o We established a professional investment office to oversee the investments on a day-to-day basis, and, in consultation with the Board of Trustees and its Investment Committee, develop a strategic vision for the endowment over the next decade.
o The investment office has overseen the establishment of investment guidelines and policies and is executing a strategy that prudently balances the safety of the investments, expected return of the portfolio, and liquidity and flexibility to support the university.
The endowment remains secure and as of June 2013, the endowment of Yeshiva University and its affiliates was $1.17 billion. In keeping with prudent investment guidelines and our spending rate policies, we balanced support of current needs while maintaining substantial resources for future generations.
Below is a performance summary of the University’s long-term investment pool since 2002, which includes the endowment, as compared to other college and university endowments.
[Please click to enlarge]
We are in the process of finalizing our plans for creating a sustainable business and academic model for the University and look forward to sharing more information about that in the near future. Undoubtedly there is hard work ahead of us, but we are encouraged by the deep commitment of the YU community to our long-term success, and the many opportunities available to build upon our growing momentum.
Richard M. Joel
Bravmann Family University Professor
Update 2:38 pm CDT – The following chart helps to expose what appears to be the sophistry in Joel's response. Please click to enlarge: