2016-2017

[ ]

C R A F T E D I N

T E N N E S S E E

VISION To become a world-class interdependent

foundation serving the University of Tennessee

by enhancing existing relationships, developing

new relationships and creating philanthropic

opportunities throughout UT.

MISSION As a valued partner, the University of Tennessee

Foundation enriches the lives of the UT family

through engagement, stewardship and private

support.

[ CORE VALUES ]INTEGRITY We adhere to honesty and sound moral principles in serving the UT

family and its constituents.

MOTIVATION We willingly support UT’s pursuit of excellence in higher education

to meet the fundamental expectations of all those we serve.

PURPOSE We seek to further UT’s mission to educate, discover and connect.

We do so through effective stewardship of relationships and

philanthropic gifts.

ACCOUNTABILITY We accept responsibility for the proficient stewardship of

relationships and resources entrusted to the Foundation.

COLLABORATION We agree to seek out cooperative measures with individuals and

entities which will lead to growth and diverse opportunities for UT.

TRANSPARENCY We will intentionally make available the full, accurate and timely

disclosure of relevant information.

This is an impact

report of the

system-wide

achievements,

accomplishments

and performance

of the University

of Tennessee

Foundation in the

fiscal year 2017,

from July 1, 2016,

through

June 30, 2017.

utfi.org/utmade

#utmade

C R A F T E D I N

T E N N E S S E E

[ UT MADE ]HANDCRAFTED

Seeing purpose in the discarded,

Knoxville’s Scrappalachian Art welder

and metal artist Greg Tune forged

reclaimed metal to create a replica

of the UT wordmark. With salvaged

and somewhat random finds, Tune

customized the wordmark with

iconic images, symbols and objects

to represent the “making” of the

UT System.

[ UPLIFTING A NATION ]OF MAKERS

Building a nation of makers, shakers and out-of-box thinkers,

the University of Tennessee is an imagination incubator.

The history of UT is steeped in craftsmanship and collaboration.

From revolutionizing forensic science to creating a thriving

farmland to inventing a sound aid for a child to hear, makers

thrive in making the impossible possible.

No one campus, department, student or professor has done

it on their own. They have joined forces across disciplines

and campuses. They have been lifted by dream seekers and

dream builders. They have been pushed and rooted on by

investors and mentors.

We give, like you, to ignite the flames of the fire students,

teachers and researchers are creating in themselves and in

crafting tomorrow’s solutions.

Foundation Board Chair

Ronald L. Turner, chair

Michael K. Littlejohn, vice chair

M. Steven Morris, past chair

Rickey N. McCurry*

Joseph A. DiPietro*

Steven R. Angle**

J. Jonathan Ayers

Alexis G. Bogo

Marie A. Chisholm-Burns**

Gregory E. Cox

Sandra H. Fancher

Ronald E. Frieson

Dee Bagwell Haslam

James L. Herbert Jr.

Joseph LaPorte III

Robert J. Kaplan

Larry B. Martin

Janet L. McKinley

Charles E. Moore

Sharon J. Pryse

Richard H. Sain

Betty Ann Tanner

Charles A. Wagner III

Philip A. Wenk

Charles E. Wharton

James L. Wolford***

*Ex-officio

**Non-voting

***Deceased

Kimbrough L. Dunlap III, president

Elizabeth C. Brasher, president-elect

Chandra D. Alston, treasurer

P. Alan Ledger, past president

Lee Ann Adams

David H. Bryan

Emily Capadalis Love

Sue D. Culpepper

Charles T. Deal*

Joseph A. DiPietro*

James H. Duke Jr.

T. Michael Estes

Charles D. Haney

Jayne A. Holder*

Delmont E. Jones

Catherine King

Timothy P. Lanier*

J. Ford Little

Robert A. Mathis

Rickey N. McCurry*

Lora P. McDonald

John D. Pate

Leland D. Patouillet*

Stephanie F. Simpson

Roger P. Smith

John D. Staley III

Candace D. Tate

Timothy L. Tucker

Kerry W. Witcher*

Stanley P. Young

[ BOARD OF DIRECTORS ] [ BOARD OF GOVERNORS ]

Ron Turner

Kimbrough Dunlap

Board of Governors President

[ UT MADE ]MAKING MORE,

TOGETHER

“The University of

Tennessee is a place where people are busy making a difference—without waiting to be told how to make that

difference.

”—UT SYSTEM PRESIDENT JOE DIPIETRO

B R E A K I N G I T D O W N

61,268donors invested

$221,158,109

14,901gifts online

$181.68average online gift

$335,000scholarships

$46,000 faculty awards

$49,000legislative internships

awarded throughout the UT System by

the UT Alumni Association

370,000 alumni in 149 countries and all 50 states

T O P S T A T E S W H E R E A L U M N I L I V E

218,490Tennessee

21,025 11,665Georgia Florida

10,251 9,026North Carolina Texas

33%have master’s degree or higher

R E P R E S E N T I N G A C R O S S T H E S T A T E A N D B E Y O N D

53,689attendees of alumni events and programs

1,022events hosted

1,694volunteer leaders

1,924alumni career guides serving as mentors

5,500alumni legislative council advocates

L O V E S A N D L I K E S

44,782Facebook fans

14,793 LinkedIn members

14,454 Twitter followers

7,994 Instagram followers

(combined for all campuses)

482,870 Annual website traffic

(all alumni sites)

24% average open rate of email marketing

C R A F T E D I N

T E N N E S S E E

[ UT MADE ]ALUMNI &

COMMUNITY ENGAGEMENT

A D V O C A C YThe Advocacy Network is the University

of Tennessee’s official grassroots effort.

It includes more than 5,500 alumni,

employees, students and friends who

believe in the university’s value to all

Tennesseans and share that message

with elected officials.

L E G I S L A T I V E C O U N C I LSixty representatives from all UT

campuses and institutes leverage their

expertise and leadership to ensure

UT’s success for the betterment of the

state. Convening at the start of the

legislative session, the Alumni Legislative

Council is schooled by the UT Office of

Government Relations and Advocacy

on funding priorities and greatest needs

linked to increasing the capacity of

educating students, producing research

and providing outreach.

U T D A Y O N T H E H I L L

UT Day on the Hill highlights students

and entities from throughout the UT

System by bringing them to Nashville’s

legislative hub as representatives and

storytellers of the university’s mission to

educate, connect and discover.

[ UT MADE ]ENGAGING TOGETHER

N E X T G E N E R A T I O N F A R M I N GWhile teaching farmers of tomorrow,

the student-run Institute of Agriculture’s

VOLunteer Supported Agriculture (VSA)

Program stocks refrigerators in homes

and tables at homeless shelters with a

cornucopia of fruits and vegetables.

The program’s enthusiasts do not only

deliver farm-to-table goodness, they also

believe in the communal spirit of farming.

The packinghouse, which was largely

funded by the Alliance Giving Circle,

offers a sanitary landing spot for heirloom

harvest to be packed. But more than

that, “it is an educational, research and

outreach hub for students, researchers,

farmers and community members,” said

VSA Coordinator Samantha Flowers.

“There is not a single day during the

farming season that the student interns

and I did not utilize the packinghouse.

Before the internship, none of the crew

knew anything about food safety, little

about proper storage methods and

nothing about what constituted a good

packinghouse. Now they know what

state-of-the-art packinghouse design

looks like.

“It’s a communal hub—one that is

inspiring a community.”

ALUMNI SIGNATURE PROGRAMS

ALLIANCE OF WOMEN PHILANTHROPISTS

More than 4,200Alliance members

Alliance members have committed

$1,193,093,280 to UT

Women donors have increased from

124,244 142,488 since 2016

[ UT MADE ]ENGAGINGTOGETHER

C A R E E R T O O L B O X“What do I want to be when I grow up?”

is the question Melissa Tribble asked

herself after a company restructure left

her without a job.

A resume review session with UT

Alumni Career Services gave her a

boost in prepping for job interviews.

“One of the biggest takeaways was

receiving a template that broke

down a job description,” said Tribble.

“It allowed me to think through my

background and how it aligned with

the job.

“I found my hour of time so valuable

that I have directed no less than five

people to Alumni Career Services.”

Along with reviewing resumes

and one-on-one career coaching,

Alumni Career Services offers alumni

exclusive regional career fairs and

networking workshops. Accessible

to any UT graduate, online offerings

feature a slew of resources, including

career assessment tools, a job search

engine, professional development

webinars, long-distance educational

opportunities and a career mentoring

network to connect established alumni

with those who are job searching.

ALUMNI SIGNATURE PROGRAMS

ALUMNI CAREER SERVICES

238 career coaching sessions given

5,756registered users on UTAA Job Board

33,000alumni impacted by Alumni Career Services

ALUMNI SIGNATURE PROGRAMS

TENNESSEE TRAVELERS

11,000Tennessee Travelers bookings since 1972

82% of UT alumni who travel are donors

$125,000is the average lifetime giving of alumni travelers

[ UT MADE ]ENGAGING TOGETHER

I N G O O D C O M P A N Y“Traveling to England in the

company of kindred Tennessee

spirits with a thoughtfully planned

itinerary and accommodations

was just my cup of tea,” said

Rebecca Moss (pictured far right).

“There were four of us carrying

the banner for Tennessee.

“From the Cotswolds to the

Highclere Castle of ‘Downton

Abbey’ fame to the birthplace of

Winston Churchill—these were a

few of the high-spots of my maiden

voyage into group travel filled with

camaraderie of shared experiences,

meals and conversations with new

friends. The bar has been set very

high, indeed!”

Leveling up the traveling game

since 1971, Tennessee Travelers

has been the alumni tour program

of choice for more than 11,000

travelers.

[ UT MADE ]PHILANTHROPY

IN ACTION

“Your ethos of

giving back is the ignition point of a maker’s hustle to go beyond the

norm and create at UT something the

world needs.

”— UT FOUNDATION PRESIDENT

RICKEY MCCURRY

[ UT MADE ]DRONE-DRIVEN SOLUTION

As a small boy, Alex Adams evinced the classic symptoms of the future

inventor, from rigging Legos to modifying electric airplanes to detailing

neighborhood cars.

The UT Knoxville twice-graduate is well-versed in tinkering. With a

mechanical engineering degree and MBA, Adams is putting his education

into practice as the inventor of GeoAir.

Combining drone technology with DNA air-sample testing, GeoAir detects

mold before it strikes crops, allowing farmers to treat their fields before plant

damage begins, saving time, money and crop production.

This idea took flight in his kitchen apartment after a $6,500 boost—$1,500

from the Vol Court Pitch Competition along with office space within the

UT Research Foundation Business Incubator and consulting services, and

$5,000 from the Boyd Venture Challenge.

No stranger to pitching his ideas through the Anderson Center for

Entrepreneurship and Innovation in UT’s Haslam College of Business,

Adams first found seed money for another idea—consumer hammocks

with a novel suspension system.

The late nights in his dorm room negotiating with manufacturers

overseas to mass produce hammocks have been replaced by convincing

conversations with Tennessee farmers.

“One-third of the world’s crops go bad because of mold,” he said. “In

Illinois, Minnesota, Nebraska and Iowa there was about $10 billion lost due

to mold every year, and that’s just corn.”

“It’s a promising technology,” said Darrell Hensley, extension specialist

with the Institute of Agriculture who has worked closely with Adams in

the development of the technology and matching him with local farmers

to test the product. “DNA analysis is going to give a quicker answer than

anything else, and the bottom line is it will save farmers money.”

C R A F T E D I N

T E N N E S S E E

[ UT MADE ]THE REAL

‘LAW & ORDER’

CSI teams of college students from across the

country gather every summer in Oak Ridge to sift

through crime scenes that mimic real life.

The three-week collegiate academy—the National

Forensic Academy Collegiate Program—is a condensed

version of the 10-week academy completed by law

enforcement professionals each year.

Hosted by the UT Law Enforcement Innovation

Center and designed in part by UT Martin, the hands-

on crash-course in fingerprinting, blood spatter

analysis, crime scene investigation, DNA analysis

and anthropology had a maximum enrollment of 28

students for the 2017 class. And every seat was filled

with another dozen names on the waiting list.

Students from California, Illinois, Nebraska,

Connecticut, Utah, Wyoming and other areas joined

those from Tennessee to complete the elite academy

that will put them ahead of their fellow criminal

justice graduates.

“I will have more training than the normal person

would (when applying for jobs), so this will definitely

set me apart,” said Melanie Allen, one of seven UT

Martin students to complete the academy, who has

been enamored with forensic science since she was

5, when “I walked in and my parents were watching

‘CSI’ and I said, ‘I’m going to do that.’ I’ve stuck with

it ever since.”

C R A F T E D I N

T E N N E S S E E

[ UT MADE ]‘MY SOUND’

With her newborn daughter in her swing sound asleep, Cristin Doty

banged pots and pans.

Emerson didn’t flinch.

“A mother’s instinct never fails,” said Doty, who knew her daughter was

profoundly deaf before doctors confirmed the genetic defect.

The nurse practitioner turned stay-at-home mom’s sleepless nights were

filled with feedings and mounds of research on cochlear implants. Before

the bilateral cochlear implant surgery at 9 1/2 months old, Emerson got

her first pair of hearing aids at 7 weeks old. And at 8 weeks old, she was

immersed in speech therapy at UT Health Science Center’s Hearing and

Speech Center in the bowels of Neyland Stadium.

Commuting from Chattanooga to Knoxville three days a week became

a constant. “The Center gave Emerson the quality of life that I think she

deserves,” said Doty, “and I wouldn’t trade it for the glitz and glam of any

other facility.”

Even when Doty’s husband, Jesse, was a medical fellow in Idaho, Emerson

kept her appointments by participating in teleintervention with her

speech pathologist, Velvet Buehler, in Knoxville.

“It was purposeful play and conditioning to prepare her for what she

would eventually hear,” said Doty, who has created the Emerson Grace

Doty Fund for the Hearing and Speech Center, “for children, like my

daughter, and for other deaf children to have access and learn from the

very best.

“The Center is like a second home,” where Emerson, now 6, visits annually

for programming of her cochlear implants with audiologist Kelly Yeager.

“It’s just my sound,” Emerson said referring to her implants. “Like you

wear glasses to see, I wear these to hear.”

Visit utfi.org/utmade to watch Cristin Doty share her daughter’s journey with the UT Health Science Center’s Hearing and Speech Center.

C R A F T E D I N

T E N N E S S E E

GRAND TOTAL$221,158,109

GRAND TOTAL$221,158,109

37.02%

ANALYSIS BY SOURCE*

FUNDRAISING TOTALS*

ALUMNI$81,865,833

38.20% FRIENDS$84,476,497

15.83% CORPORATE

$35,018,738

6.65% FOUNDATION

$14,699,666

36.15%

ANALYSIS BY PURPOSE* OPERATING$79,938,798

16.41% ENDOWMENT

$36,292,619

9.82%

CAPITALCONSTRUCTION$21,725,386

37.62% DEFERRED$83,201,306

2.30% OTHER

$5,097,373NUMBER OF DONORS**

Knoxville .................................................................. 43,123 Donors

Chattanooga.............................................................6,385 Donors

Health Science Center...........................................4,771 Donors

Institute of Agriculture ........................................ 3,767 Donors

Martin ......................................................................... 3,699 Donors

System..........................................................................3,216 Donors

TOTAL....................................................................... 61,268 Donors

*Using campaign counting logic**Donor totals do not equal the sum of all campuses; many donors give to multiple campuses and programs

Knoxville .................................................................... $155,248,895

Institute of Agriculture ............................................$21,108,569

Chattanooga.................................................................$16,652,515

Health Science Center............................................$16,398,000

Martin .............................................................................. $11,075,592

System................................................................................. $674,537

TOTAL...........................................................................$221,158,109

FISCAL YEAR 2016-2017

[ FINANCIALS ]

INVESTMENT APPROACH The university’s endowment takes a long-term approach to investing, with a minimum objective of achieving an annualized return greater

than the rate of inflation plus spending. To that end, it has implemented a disciplined strategy that incorporates both active and passive

management, depending on the target market or manager strategy. The university works with an outside consultant to find managers who

possess a repeatable strategy, solid investment culture and emphasis on risk management. This approach enables the university to maintain its

long-term, strategic focus and avoid the distractions of short-term market movements. It is important to note that the endowment is broadly

diversified across multiple asset classes. Consequently, over any given time period, its return may diverge significantly from popular indices

such as the S&P 500, individual mutual funds and its peers.

*The Policy Benchmark is 60% MSCI ACWI IMI Index, 39% Barclays Global Aggregate Bond Index and 1% Cash**Inflation + Spending is the one-year Consumer Price Index plus a constant of 5.50%

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

UT 14.1% 20.4% -6.6% -24.1% 13.3% 21.5% -2.3% 12.3% 17.4% 1.0% -2.4% 9.9%

Policy Benchmark* 14.2% 21.1% -5.9% -22.8% 11.3% 24.6% -3.9% 12.3% 17.7% 1.0% 0.7% 10.1%

Inflation + Spending** 9.8% 8.0% 10.3% 4.3% 6.6% 9.0% 7.2% 7.3% 7.5% 5.6% 6.6% 7.3%

ENDOWMENT ASSET ALLOCATIONS

Public Equity32%

Instruction &Academic Support

50%

Scholarships &Fellowships

35%Public Service

4%

Investment Grade Debt

7%

RealEstate

6%

Private Equity8%

Research10%

InstitutionalSupport

1%

HedgedStrategies

16%

Credit/Distressed Debt15% Cash

1%

NaturalResources &

Infrastructure14%

ENDOWMENT INCOME BY AREA

FISCAL YEAR 2016-2017

[ FINANCIALS ]

INVESTMENT IMPACT For the fiscal period ending on June 30, 2017, total assets invested for the benefit of University of

Tennessee were $1.3 billion, an increase of $114 million over the prior year. This growth was driven by

improving economic trends, corporate earnings and the quieting reassurance of central bankers. Global

stocks provided the greatest lift along with private equity.

Beyond those two asset classes, however, high-yield debt was the only other broad category to post

double-digit returns for the period. In contrast, most commodities, global investment-grade bonds and

public real estate were flat or negative for the twelve months. Inflation expectations remained modest, and

investors began to anticipate a rising interest-rate cycle driven by the Federal Reserve. These combined

factors left energy to trade on bearish supply and demand fundamentals, while real estate and bonds fell

victim to a higher expected discount rate. In short, equity and speculative debt drove returns, as there was

little else to move the markets higher over the year.

The university’s capital base includes five separate investment vehicles. At June 30, endowments

accounted for $926 million, with $911 million in the Consolidated Investment Pool and $15 million in separate

endowments. Chairs of Excellence were $152 million and the University of Chattanooga Foundation was

$135 million. Finally, Life Income Trusts stood at $42 million. The accompanying chart displays these

categories at each fiscal year-end for the past ten years.

The Consolidated Investment Pool (the Pool) is the largest component of invested funds and was

established in 1954 to allow for the diversification and efficient investment of any endowment, regardless

of size. With the dual mandate of generating long-term total returns above the spending rate while

simultaneously managing downside risk, it maintains a globally diversified portfolio. For the fiscal period

ending June 30, one-, five- and ten-year total returns were +9.9%, +7.4% and +3.1%, respectively. The Pool

distributed $39 million in fiscal 2017, an increase of approximately $3 million from the prior year.

Other distributions included those made by The Tennessee Chairs of Excellence and the University of

Chattanooga Foundation of $4 million and $8 million, respectively. Both of these categories are managed

outside the Pool. The Chairs of Excellence are administered by the treasurer of the state of Tennessee for

the benefit of all UT campuses. The University of Chattanooga Foundation is managed by its foundation

board and supports programs at UT Chattanooga only.

ENDOWMENT OVERVIEW

$1,400

$1,200

$1,000

$800

$600

$400

$200

$0

TOTAL FUNDS (1=$1,000,000)

2014 2015

$806

$50

$139

$127

2013

$684

$44

$123

$112

$837

$44

$137

$131

2016

$834

$43

$140

$125

2012

$612

$42

$114

$101

2011

$630

$42

$113

$103

2010

$541

$40

$99

$88

2009

$485

$42$93

$87

2008

$661

$53

$111

$114

UC FOUNDATION CHAIRS OF EXCELLENCE LIFE INCOME TRUSTS UT ENDOWMENTS

2017

$926

$42

$152

$135

[ A MAKING GROUND ]

Powered by makers, creators, crafters and collaborators, the University of Tennessee

is a place where people are busy making a difference—without waiting to be told

how to make that difference.

From the classroom to the board room, we’re making a better society by enabling

fairness, integrity, opportunity and justice. We are creating breakthroughs in

medicine, undeterred even in the midst of setbacks. We cultivate new ideas with the

promise of a better future for farmers, teachers, engineers and artists.

And when we collaborate, we do so from a statewide perspective—partnering with

our communities, their institutions and their leaders—producing collective outcomes

that make the world a better place.

Making investments in the university exponentially increases our capacity to make

dreams possible and make realities that are impactful. Private giving is a game-

changer across the spectrum, from enabling exceptional students to creating the

facilities required to prepare those students to succeed.

Thank you for your generous support, which is critical to keeping our promise of a

brighter future for everyone whose life is made better by the University of Tennessee.

PresidentUniversity of Tennessee System

[ MAKING MAKERS ]

You are the undergirding to making dreams into realities for countless visionaries,

inventors, artists, educators and entrepreneurs again and again.

It never gets old. The light of students’ eyes when they share how a scholarship

made their education possible. Or a graduate researcher who was about to give

up until a late-night tinkering session propels a climate change idea toward global

recognition. Or a professor who kick starts science to challenge the pathway for a

cure for cancer.

The alignment of academic inquiry with action learning empowers students and

professors to own the reins of being creators and influencers.

You are at the epicenter of altruism in the reflection of gifts, pledges and bequests

across UT that topped $221 million. Achieving this goal translates into lifting makers,

builders and doers day in, day out.

Your ethos of giving back is the ignition point of a maker’s hustle to go beyond the

norm and create at UT something the world needs.

You continually join the work, with your hands and heart, making UT a second-to-

none makerspace.

Vice President for Development and Alumni AffairsPresident and CEO University of Tennessee Foundation

Joe DiPietro Rickey McCurry

C R A F T E D I N

T E N N E S S E E

“The alignment of academic inquiry

with action learning empowers students and professors to own the reins of

being creators and influencers.

”— UT FOUNDATION PRESIDENT

RICKEY MCCURRY

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