Endowment Gifts
Make life better for children today and tomorrow
Through the establishment of endowment funds, generous philanthropists ensure a reliable source of income will be available so that Children’s Health can continue meeting the medical, social and emotional needs of all the children served.
Endowment gifts are established to provide perpetual support for a project, program or other need that is close to a donor’s heart. Contributions made to establish endowments are invested to generate earnings. Each year a portion of the earnings from the fund, as determined by the spending policy adopted by the board of Children’s Health, will be used to support the designated purpose of the gift. Earnings in excess of the amount to be spent will be returned to the fund and reinvested allowing the principal to grow. As the principal grows, the earnings will also grow and continue to provide an ongoing source of support.
Endowments are especially well suited for those areas that need a sustained source of annual income and one that can provide support for a project, program, or other areas in perpetuity. Invested for long-term growth and carefully managed to preserve capital, endowments provide a lasting legacy for donors and help secure the future for the fund’s designated purpose. A minimum gift of $50,000 is required to establish an endowment at Children’s Health.
To talk with any of our Development Officers, please call (214) 456-8360. You may also email us at giftplanning@childrens.com.
2022 Endowments
More than 200 named endowments funded by donors are housed by Children's Medical Center Foundation. A range of clinical, non-clinical, research, training and community-facing areas benefit from these funds' annual distributions, which help sustain important programs and spur new developments at Children's Health. Examples include clinical research, mental health and Family Support Services such as Child Life.
One-Year Performance
The Foundation's financial performance in 2022 was particularly strong because both manager selection and asset allocation contributed positively to value add through active management. The portfolio's unrealized losses equate to a -8.2% decline for the fiscal year, compared to a -9.3% decline for the Foundation's policy benchmark. The Investment Office, in close collaboration with the System's senior leadership and the CHST Investment Committee, added 1.2% in incremental value during 2022 through active management.
Three-Year Performance
For the three-year period ending Dec. 31,2022, the Foundation portfolio returned 5.2% per annum, outperforming the policy index's 4.3% return by 0.9% per annum. Performance over this timeframe includes not one, but two challenging periods in markets—the start of the Covid-19 pandemic in 2020 and the challenging effect of inflation on financial markets in 2022.
What is the investment policy at Children's Health?
The Investment Office at Children's Health manages the financial assets of the health care system, which include board-designated reserves in the form of a quasi-endowment, as well as donor funds entrusted to Children's Health in perpetuity.
The Foundation's substantial investment portfolio offers a wide array of opportunities for active investment management, giving us the opportunity to partner with talented external fund managers to identify profitable investment opportunities greater than what the broader stock and bond market can provide. Active management goes hand-in-hand with diversification across investment mandates, investing styles, geographies and asset classes. The combination of active management and diversification allows us to strive for superior investment results over time.
The four pillars of our investment approach—our long-term horizon, active management, diversification and awareness of risk—are meant to uplift the mission of Children's Health. For the Investment Office and its immediate government stakeholders, our first duty of care is as fiduciaries for the financial interest of the hospital system and its mission, including its ability to serve future generations.
How are Endowment Funds distributed?
The current annual spending policy for endowments at Children's Medical Center Foundation specifies a 5% distribution of a rolling 12-quarter average of the ending fair market value of the fund. Because the endowment pool performance fluctuates from year to year, the use of a 12-quarter rolling average helps to stabilize the support these funds provide to programs. The 5% distribution rate is reviewed annually in order to protect the corpus of the endowments and to ensure the funds continue to provide sustainable, reliable support for the donors' designated purposes. Endowment distribution policies comply with the Texas Uniform Prudent Management of Institutional Funds Act, as amended.
2023 Investment Staff
Ken Lee, Chief Investment Officer
Kyle Stewart, Director of Investments
Yangge Seaman, Director of Investments
Chris Andry, Director of Investment Operations
Cory Garcia, Portfolio Manager
Jonathan Goetsch, Investment Associate