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Leadership and Peer Education

This year, PCI has so many students participating that they have split their Monday evening sessions into two groups, with an hour session for students with less experience and a second hour for those with more experience. According to Michael Lawrence, director of the business and finance career community, “Over the last few years, PCI has really made efforts to ensure that there is leadership continuity and planning. This leadership team has done a fantastic job creating educational modules and thinking very strategically about how they structure the organization. I think it’s a great experience for students.”

“We do a lot of education student-to-student,” says Ford. “A lot of us are really engaged in the investing world and we want to share that. We teach financial modeling, informed investing, and other topics, and we collaborate with the investment office, which makes trades on PCI’s behalf.”

The leadership team meets weekly to plan out what they want to accomplish over the course of the semester. “I think we’re very focused on making decisions as a club, not just leadership making decisions, but really making a democratic decision,” adds Mahiro Noda ’26.

Early in the spring semester of 2024, the club leadership — Ford, Noda, Cole Beattie ’25, and David Eason ’24 (who graduated in May) — were seeing a lot of news about how colleges and universities use their endowments and the role of social responsibility in investing. “There was a lot of conversation about what �鶹��ý students think about the endowment. We had a lot of preconceived notions, so we decided, with input from the investment office, to do a survey,” says Ford. “What we found challenged those assumptions and brought to light what students are thinking now,” she notes.

The Survey

The team worked together to create a survey. They asked Jainen Thayer, chief investment officer, and Graham Miller, director of strategic research, to review the questions and structure. “We were blown away by how thoughtful and careful PCI was in constructing the survey,” says Thayer. The survey sent to students was open for about five weeks, and 177 students filled it out.

Starting with the basics, PCI asked about the size of the endowment. Fifty-five percent of respondents correctly identified that the endowment market value is between $2 billion and $3 billion. “But 39% were estimating significantly more, which shows that current information isn’t reaching the students,” says Ford. While 38% correctly identified investment returns and 35% philanthropy as a source of endowment growth, 16% believed that student tuition and 10% that government funding played a role.

“That 35% speaks to the ways that philanthropy is visible to students,” says Noda. However, they noted, Pioneer Fund and Scarlet & Give Back Day are both part of annual giving programs, where funds are used right away. �鶹��ý’s cost to educate each student is about $20,000 more than tuition, so tuition funds are used up about halfway through the fall semester.

Who’s the Decider?

When asked about who makes investment decisions for the College, almost three-quarters of respondents correctly identified that the Investment Office and the Board of Trustees (through the Investment Committee) are the only parts of �鶹��ý that oversee investment decisions. “The Investment Office was kind of mysterious. We were asking, who’s the Boston team and what’s that about? The office has made a big effort to connect with us,” says Ford. “The events of last fall brought up a lot of conversation about, ‘OK, how does �鶹��ý actually work? How does �鶹��ý fund things?’ Students really want to know.”

That’s why they asked what students thought the endowment funds support, with most respondents correctly identifying financial aid, faculty and staff, and facilities. But 16% believe that it funds student organization budgets. “That’s really unexpected,” says Brad Lindberg, associate vice president of institutional initiatives and enrollment who sits on the committee that sets the student activity fee each year. “Because 100% of the dollars collected from the student activity fee go directly to the Student Government Association and the Student Publications and Radio Committee (SPARC) for distribution through the student organization budget process. It’s the only source of funds for student organizations.”

Who Benefits?

Next, PCI asked whether students believe the endowment should support current or future students. Fifty-three percent believed that support should go all or mostly to current students, while 46% believed support should go to current and future students equally. “This was fascinating to me,” says Thayer. “The purpose of having an endowment is to provide support for the institutional mission in perpetuity, and that message has been internalized by almost half of students. ”

Social Responsibility and Beyond

The team wrapped up with a question that asked students whether �鶹��ý’s endowment should focus on social responsibility or financial returns. “The term social responsibility can be interpreted in many different ways, but financial returns are very concrete and measurable, so we wanted to have that contrast,” says Noda. Slightly over half of respondents prioritized social responsibility over investment returns. According to Thayer, �鶹��ý’s endowment managers and the investment committee remain very committed to reflecting both ESG (environmental, social, and governance) factors and DEI (diversity, equity, and inclusion) principles in investment decision-making processes.

To close the survey, PCI asked students what they want to learn more about, which covered all of the topics in the survey. “The results show that the endowment is still a very mysterious topic to many. Coming back to the misconception that student tuition goes into the endowment, that’s a narrative we heard quite often,” says Noda.

“The biggest thing I took away was why would students think about investing from an institutional standpoint. Higher ed is such a weird form of institution. Students are comfortable with thinking of how a business thinks because that’s what’s out in the media. The College is a business in its own way, but it’s not for profit,” says Ford. “There’s a lack of knowledge of how institutions finance themselves and how institutions work. Some of the comments encouraged us to think towards what we might do in the future to provide more education and encourage dialogues,” adds Noda. “The endowment isn’t there by itself; it’s part of the whole decision-making of how the College functions. Specifically, how the College tries to ensure funding for current students but also tries to think about the future.”

“I think the overwhelming response is a level of curiosity about how the College works, and I think it would be interesting to have more dialogue and shine a light on a lot of the resources and things that are done here that take funding,” says Ford.

Ongoing Financial Education

The College is already taking steps to provide more regular updates about the endowment, the budget, financial aid, enrollment, and other topics. This fall, President Anne F. Harris and Vice President of Finance and Chief Financial Officer Germaine Gross participated in a live Q&A session moderated by Alumni Council member Grisel Hernandez ’17 to answer questions about the endowment. A recording can be found online at alumni.grinnell.edu/endowmentcall. PCI’s leadership is planning an on-campus presentation of their data, including a Q&A with Thayer, for later in the academic year.