Despite a -8.9% return (net of fees and expenses) for the endowment portfolio, the University of Toronto Asset Management (UTAM) surpassed its benchmark reference portfolio return of -13% for the same period.
Despite a -8.9% return (net of fees and expenses) for the endowment portfolio, the University of Toronto Asset Management (UTAM) surpassed its benchmark reference portfolio return of -13% for the same period.
‘Together,’ its ‘2022 Integrated Annual Report,’ highlights the short-term challenges faced by UTAM in 2022, within the context of its long-term investment approach and proven track record.
Over a 10-year period, the endowment's annualized return has been 8.2% on an absolute basis, exceeding the university's target return and the reference portfolio benchmark by 1.8% and 1.9%, respectively.
The expendable funds investment pool (EFIP) achieved a -2.9% return, outperforming its target return by 0.1% over the same period.
Advancements in responsible investing
The reportcombines UTAM's annual review of investment activities, governance, risk management, and portfolio performance with an analysis of how environmental, social, and governance (ESG) factors inform their investment decision-making and stewardship efforts.
It also showcases its progress in reaching climate goals. In line with the commitment to achieve net-zero emissions in the endowment portfolio by 2050, UTAM joined the UN-convened Net Zero Asset Owner Alliance and established interim targets in 2022 for emissions, engagement, and transition financing.
A new carbon footprint target of a 50% reduction by 2030 (using 2019 baseline levels) for the endowment portfolio was announced as UTAM has divested fully from direct investments in fossil fuel companies.
It has also made headway in allocating at least 10% of the endowment portfolio to sustainable and low-carbon investments, with 4.1% already invested in such strategies by the end of 2022.
