Tim discusses how Notre Dame measures its impact through mission and stewardship metrics, including ESG scores. The university uses these frameworks to align organizational goals with broader social good and track influence among alumni and stakeholders.
Every organization in the world is trying to be more innovative. The good news is in Silicon Valley, we figured out how to do it and how to do it really simply. It really is not hard. And any organization can do it, whether it's a nonprofit, a university, a Startup, a Fortune 500 company. It all comes down to the same things. So it all starts with mission. So you have your mission. Why do you exist? At Notre Dame, it's to be a force for good in the world. So it starts with mission. Then what are your metrics? You can't fix what you can't measure, so you got to have your metrics. You can't have a thousand metrics. You need a couple metrics that point your organization in the right direction. So at Notre Dame, there's two metrics that matter the most. One is the mission metric, which we said was force for good. So how do we measure force for good? And we'll talk about that in a second. And then the stewardship metric. How do we do it profitably? Now, what's interesting here is Notre Dame has a massive endowment. So every year more and more of the expenses are covered by endowment payout, which is really powerful. So at Notre Dame, it's. It's a pretty easy metric, high level stewardship metric, which is percent of opex, percentage of operating expenses that are covered by endowment payout. If that is the top stewardship metric, it gets a lot easier to make financial decisions and investment decisions at Indy. And then on the mission metric, it's force for good. So most top universities have a mission that's to advance knowledge or other things, and that's very inwardly focused on what happens within the four walls of the university. At Notre Dame, it's to be a force for good in the world. How do we do that? We do that primarily by the members of the Notre Dame family. So we have faculty and staff and students and alums that make up the Notre Dame family. The vast majority of the Notre Dame family is in this alum bucket. What's really interesting is now with the world shifting to esg, Environmental, social, governance, scoring, it's really easy to score how good a company is at serving the common good. Now remember, metrics don't have to be perfect. They just got to point you in the right direction. So these ESG scores are interesting because they point you at a company that is that company serving the common good or are they hurting the common good? And that comes down to thinking about the stakeholders now. So you think about your customers and your employees and the planet and the communities in which you operate and the shareholders, all of these five groups matter now in coming up with an ESG score. So if we take the Notre Dame alumni, student, staff, faculty group, say, okay, what organization do they work for? Grab their ESG score and then weight it by the title of the donor. If the donor is a CEO, it's a lot more influential than if a donor is an early entrant in the work. And then weight it by the size of the company as a proxy for influence. So if we add up the, if we look at all the orgs where these groups work, grab their ESG score or compute it or proxy it, and then weight each one by title of the donor and the size of the org and add them all together, then we can see how we're doing collectively. Are we a force for good in the world or are we not? Now what gets interesting is that group is about 200,000 people. But you'll notice that faculty, staff and students are all involved with one organization called Notre Dame. So the ESG score for Notre Dame matters a lot because a fairly significant portion of our Notre Dame family works at Notre Dame. So we can calculate what the ESG score is for ND use that as the basis for this portion of the ND family, then go off and look at where all our alums are, what organization they work for, are they advancing ahead of their peers into senior positions, are the organizations are running increasing in importance and influence in the world and then figure out how to get better. So for example, if these were our two metrics, this Force for Good score and the stewardship metric, then we can look at any organization within Notre Dame and figure out if they're helping or hurting the common good. And help people point themselves at the right thing. So for example, Career Services today Career Services has a very different metric. Their metric today Career Services, their metric today is percent placed six months after graduation. So we got 2200 of the smartest, top 1% kids in the world on smarts, goodness and grit who come into indeed. And we recruit them because they want to be a big force for good in the world. Well, if you notice this metric, this has nothing to do with the mission. So if you place all your kids in oil and gas companies, in predatory financial services companies, they're hurting the common good rather than helping the common good. So this metric doesn't point at the mission. So this is where having very clear top level metrics in the dome that get spread throughout the organization can help a lot. So for example, Career Services has a massive impact on both the Mission Metric and the Stewardship metric. On the Mission metric, if we look at the organizations where students want to go to be a Force for Good and we organize ourselves to help students get into those organizations, then our Force for Good score is going to go way up. So every year, Career services helps place 2,200 kids into their first starting role. Are those top hundred scoring ESG companies or are they.
