Harvard Management Company (HMC), which invests the University's endowment assets, is reducing its staffing. In a statement released today, the University said:
The Harvard Management Company's mission is to preserve and enhance the financial assets of Harvard University over the long term in support of the University's academic programs, its students, and its faculty. To maintain its position as a world-class investment organization, the new management team headed by Jane Mendillo has analyzed its current structure and processes, and has launched a series of steps to re-balance and re-engineer the organization. Targeted reductions will occur throughout the HMC and will include some investment professionals, as well as "back office" and other support personnel - operations, IT, human resources, and legal. Over the next several months HMC expects that staffing levels will be reduced by about 25 percent.
Mendillo assumed the role of president and CEO on July 1, 2008. As previously reported, the endowment has declined by an estimated 30 percent in value since the fiscal year began on that date, roughly in line with the reported performance of other, similar endowment funds.
Of the reductions, Mendillo said, "The business model at HMC--the internal platform combined with a selectively chosen external management set--is the right one for the future. However, when we, the HMC management team, asked whether our company was appropriately sized and structured for the markets we operate in today, we concluded that the time was right for a significant rebalancing of our staff and our functions. This type of thinking and rebalancing is done, and should be done, continuously, in organizations that are and that want to stay at the top of their field, through all kinds of market cycles and economic conditions."
The Wall Street Journal first reported the HMC reductions on its website this afternoon.
