The Endowment

The endowment of the Mohamed bin Zayed Species Conservation Fund was created in April 2009, with an initial allocation of $27.5m. Since then, it has been managed in such a way as to provide for the financial needs of the small grants programme in perpetuity.

The long-term objective of the endowment, as described in its Investment Policy Statement, is:

1. to make annual distributions for the benefit of species conservation, in accordance with the MBZ Fund’s spending rule;
2. to preserve the capital in US dollars over a 10-year time horizon; and, to the extent that these two objectives are met;
3. to grow the capital by having financial returns in excess of the distributions made.

Markets and performance in 2020

2020 proved to be a tumultuous year for global financial markets, with the coronavirus pandemic and the subsequent policy responses leading to major swings in asset prices. By late February, as it became clear that the pandemic was not going to be contained within China, markets saw some of the biggest sell-offs since the global financial crisis, as lockdowns led to shuttered businesses and people were forced to adapt to a new way of living. But although the pandemic and ensuing global recession could have proved a disaster for markets, the unprecedented fiscal and monetary stimulus that was unleashed helped to support a strong recovery in asset prices.

In this context, the MBZ Fund portfolio delivered a net performance of +10.9% (MW). The “traditional” portfolio (equities and fixed income) managed by Goldman Sachs delivered +11.5% while the “alternative” portfolio (private equity, private debt, hedge funds and real estate) mostly managed by Banque Pictet delivered +12.0%.

It is worth noting that the Private Equity bucket (managed by Banque Pictet) achieved a record +36.2% net annualized IRR from inception to end 2020.