The University has announced a budget surplus alongside strong endowment performance, highlighting investments in key mission-focused areas for the fiscal year 2024 in its annual financial report released on Thursday. The report also included details on philanthropic contributions during the period, which play a crucial role in enhancing financial aid and supporting various academic and research initiatives.
In an interview with Executive Vice President Meredith Weenick, Chief Financial Officer Ritu Kalra, and Treasurer Timothy Barakett, the trio discussed how disciplined planning and fiscal management have set Harvard up for future growth. The interview, edited for clarity and brevity, explored the University’s financial status at the end of fiscal year 2024, which closed with a surplus of $45.3 million.
Weenick remarked that Harvard maintains a robust financial position, attributed to strategic decisions made by leadership across its Schools. The reported surplus is critical, not just as a financial figure but as a valuable fund source for investing in educational and research efforts aimed at addressing pressing global issues.
Kalra emphasized that the operating results reflect the collective performance of the University’s Schools and units, which operate with local autonomy. However, she noted that operating expenses have grown at a faster rate than revenue, underscoring the need for sustainable growth.
Barakett added that building financial capacity is essential for future investments, particularly for financial aid commitments and meeting sustainability goals. He highlighted that opportunities in areas like artificial intelligence and life sciences must be tapped to drive future progress.
During the challenging academic year of 2023-2024, the University focused on providing resources for students’ well-being and fostering a supportive campus environment. Kalra pointed out that while financial aspects influenced these initiatives, the primary drivers were rooted in cultivating a conducive atmosphere for learning and inquiry.
Despite challenges, philanthropic giving reached the second-highest level in Harvard’s history, and the endowment achieved a 9.6 percent return. Weenick noted that the University never wavered from its commitment to excellence, as demonstrated by achievements such as Nobel Prizes awarded to faculty members and significant accomplishments by students and athletes.
Kalra clarified that the endowment consists of numerous individual funds, each with specific designations. The recent endowment return will boost distribution growth, although careful spending is necessary to support future generations.
As interest rates rise, Harvard decided to issue debt strategically, taking advantage of favorable credit conditions. The proceeds will fund planned capital projects and refinance existing debt to manage costs effectively.
The University is committed to supporting teaching, learning, and research that benefit society at large. In fiscal year 2024, faculty secured substantial external grants, and Harvard also invests significantly in research.
Looking ahead, Weenick expressed the need to remain vigilant amid rising costs and constraints on traditional revenue sources in higher education. Kalra noted that safeguarding financial resilience is crucial in an evolving landscape, while Barakett expressed gratitude for the community’s dedication to Harvard’s mission, ensuring its continued progress and impact.