Interview – Nuffield Foundation


INTERVIEW – JAMES BROOKE TURNER


“It is better to have trustees who can hold their nerve in a crisis than a lower volatility, lower returning portfolio.”


The Nuffield Foundation is a charity that aims to improve social policy through funding research into education, welfare and justice. Andrew Holt spoke to its investment director about how he is funding this.


You have been Nuffield Foundation’s investment director for around 20 years. What changes did you make when you took over in 2001? We had an effective chair at the time called Baroness Onora O’Neill, who is a moral philosopher. We had a single multi-asset manager working with a discretionary mandate and she thought it was wrong that the charity and its trustees should be so separated from their financial where- withal. So, the decision was taken to bring the asset allocation in house. Cambridge Associates were setting up at the time and


12 | portfolio institutional | February 2022 | issue 110


were very helpful in working this through with us.


My background is in art history, then charity finance, but not investment man- agement, so I read everything particularly carefully to understand what was going on and the underlying principles and what stood behind them. As a result we ended up with this logical, but, to some, odd portfolio based on first principles, rather than the then orthodox current knowledge. At about that time, I went on the new Yale Endowment Management Course featur-


ing luminaries such as David Swensen, Jack Meyer, Elroy Dimson and Charlie Ellis. It was a real eye opener.


Your portfolio is 10% short-dated gilts, 70% global equities and 20% private equity. Why take such a simple approach? It is a simple portfolio so we are not spread too thinly. Some people describe it as aggressive, but we don’t think of it in that way. We think that because our enemy is inflation, we cannot avoid real assets: property and equities. So, the question is, of these, which is


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