Donations to Harvard University decreased by 14 percent in the fiscal year ending June 30, due to strained relationships with major donors and criticism from notable alumni in the financial sector over the university’s handling of protests concerning the Israel-Palestinian conflict. Total contributions to the university, regarded as the wealthiest in the western world, declined to $896 million from $1.05 billion the previous year. This backlash led to the resignation of former university president Claudine Gay.
The decline was particularly noticeable in endowment donations, which typically encompass the largest contributions, falling by one-third, while day-to-day operating fund donations increased by 9 percent to $528 million. Harvard officials did not provide immediate comments on the situation. Current president Alan Garber mentioned to The Harvard Crimson that recent fundraising efforts had been disappointing compared to previous years.
The protests arose following Israel’s response to an attack by Hamas on October 7, 2023, causing disturbances on Harvard’s Cambridge, Massachusetts campus for much of the past academic year. Some affluent alumni criticized the administration for its management of the demonstrations. Hedge fund manager Bill Ackman called for Gay’s removal, while Citadel founder Ken Griffin, a substantial donor, encouraged the university to uphold “western values.”
Despite the drop in donations, Harvard’s endowment reported a 9.6 percent gain, bringing total holdings back to $53.2 billion, similar to its holdings in June 2021, before Russia’s invasion of Ukraine impacted public equity and bond markets. The 2024 returns were slightly below the 10.1 percent median for U.S. colleges and universities, as measured by Cambridge Associates, yet exceeded Harvard’s target annual return of 8 percent.
The university’s conservative investment strategy is influenced by the endowment funding almost 40 percent of its budget, an increase from 31 percent a decade ago. Narv Narvekar, CEO of Harvard Management Company, noted that their focus on strong investment returns is balanced by the need for budgetary stability.
The private equity sector, the largest part of Harvard’s investment portfolio, underperformed public equity for the second consecutive year due to challenges like declines in stock listings and mergers and acquisitions. Narvekar explained that the underperformance partly stemmed from portfolio managers not adjusting their valuations significantly during the 2022 market downturn and also during subsequent market improvements in 2023 and 2024.
Private equity investments now comprise 39 percent of Harvard Management Company’s assets under Narvekar’s leadership since 2016. Roger Vincent, founder of Summation Capital and former senior investment officer at Cornell University’s endowment, expressed a degree of admiration for Harvard’s one-year return, acknowledging its standing above some Ivy League peers with similar portfolio structures. Vincent emphasized that while the returns appear favorable, their significance depends on longer-term performance.
