UNIVERSITY OF HELSINKI: A successful year of investment: An excellent return, reduced costs and all investments in fossil fuels divested
In all, the investments of the University of Helsinki Group generated a return of more than 19% in 2020, with the listing of the spinout Nanoform bringing in over €20 million of income.
The investment assets of the University of Helsinki Group generated a return of 19.43% in 2020, while the corresponding figure for the relevant benchmark index was 6.54%. The exceptionally high return was mostly due to Nanoform, a spinout that went public last year. The University made an initial investment of roughly €300,000 in the company, while its market valuation in conjunction with the listing exceeded €20 million. Additionally, the return on the University’s listed investments in 2020 beat the benchmark index.
“If successful, the technique developed by Nanoform, which is aimed at improving the effectiveness of drugs, could help humanity as a whole. This is a significant win for the University in terms of commercialising research results, and an inspiring example for all researchers,” says Chief Investment Officer Anders Ekholm of the University of Helsinki.
The income gained from Nanoform’s initial public offering will be added to the University’s investment portfolio, which is managed according to the Principles of Responsible Investment Activities published in 2019. Among other things, the principles have helped reduce the annual cost of external asset management to 0.1%.
“Financial research shows that costs are one of the best predictors of future performance,” Ekholm adds.
The University’s investment portfolio is currently valued at a little over €500 million. Income from investment activities is used to cover part of the expenses incurred by the University’s core operations, teaching and research.
Aiming for a carbon-neutral investment portfolio
The University of Helsinki’s objective is to be Europe’s leading and most responsible university investor. In this, an important interim goal has been to divest investments in fossil fuel production.
“We have achieved one of our goals on the way to a carbon-neutral portfolio, as it no longer includes any investments in fossil fuel production,” a pleased Chief Investment Officer Ekholm announces.
The University’s income from investment activities can be explored in more detail in the report on investment activities, now published for the second time, and a related monthly report (in Finnish only).
First public investment plan released
The University of Helsinki is improving the transparency of its investment activities further. In addition to the Principles for Responsible Investment Activities approved by the University Board in summer 2019, the University’s investment plan is now being published for the first time, for the term 2021–2022. Significant long-term investments and their performance are reported on the University website.