The report said that the private foundations' sector saw robust growth in 2019 and 2020.

US endowments posted double-digit net growth in 2020 and 2019, fitting with strong market performance and contribution rates into foundations, new figures on the private foundations sector shows.

Donors contributed 57 cents for every 83 cents disbursed in grants and charitable expenses, Foundation Source, a US provider of management solutions for private foundations, said in a report. The foundation studied achieved average portfolio growth of 12.7 per cent in 2020 and 20.0 per cent in 2019 gross-of-fees. While absolute growth was down year-over-year, the trend is consistent with the performance of the US equity markets, and cumulative results were positive for the 24 months of the study.

Equities remained the largest portfolio allocation for endowments at about 55 per cent, followed by fixed income at 16 per cent and alternatives at 12 per cent.

The study tracked 1,157 private and family foundations, looking at changes in asset balances, portfolio performance, asset allocation, investment expenses and other financial transactions between 2019 and 2020.  

“A sustained period of strong market performance has created a tailwind for committed philanthropists to effect change. We expect to see record grant-making volume this giving season,” Sunil Garga, president and CEO of Foundation Source, said. 

The average costs associated with investment-related services across the foundations in the study fell to 50 basis points in 2020 from 54 basis points in 2019.