Harvard Appoints Ritu Kalra as New CFO
University finance executive succeeds Thomas Hollister as vice president.
Ritu Kalra has been appointed Harvard’s vice president for finance and chief financial officer, filling an important vacancy created by the planned retirement of Thomas J. Hollister on June 30. The announcement was made this afternoon by Meredith Weenick, executive vice president, to whom the VP/CFO reports (along with a dotted-line reporting relationship to President-elect Claudine Gay, who also takes office July 1).
Kalra has been at the University since mid 2020, most recently as assistant vice president and assistant treasurer and special projects adviser. In those roles, according to her financial administration profile, she has been responsible for managing Harvard’s cash, overseeing its borrowings and debt strategy (for an example on her watch, read about the two-part 2022 debt sale, including a “green bond” offering), and staffing special projects such as the Allston Massachusetts Turnpike reconstruction and multimodal transit center. (Harvard will help pay for the latter, and the larger project must proceed to enable development of the University’s large landholdings there.)
In the announcement, Weenick said of Kalra, “Since joining Harvard in 2020, she has provided exceptional leadership and been a trusted adviser on an array of financial matters and University priorities. Her Harvard experience, coupled with her track record as an innovator in private sector banking and finance, positions her well as a leader who will continue to build on what has been strong stewardship of the University’s finances in recent years.
Of her new role and her predecessor, Kalra said, “Harvard’s ability to forge collaborations within and beyond the University, across a breathtaking breadth of disciplines, doesn’t happen by accident. It requires a rare and sustained marriage of strategic leadership and executional excellence. Tom Hollister has been instrumental in kindling this marriage across the organization, and I look forward to working with the broader University community to build on this essential partnership to advance the academic mission.”
The New Vice President and CFO
Filling the vice president’s position internally has obvious advantages. Kalra is already immersed in significant aspects of the University’s complex financial operations, so she will not face a complete outsider’s learning curve in assuming her new responsibilities (which include financial planning, budgets, risk management, sponsored-research administration, and other functions). Reciprocally, many finance staff members and others throughout Harvard have already worked with her. The financial organization in which she has already played major roles has been notably successful (as reported here). For example, Harvard has operated in the black since fiscal year 2014, with nine-digit annual surpluses since fiscal 2017 (reflecting expense controls, low inflation, good investment markets, and the proceeds of the Harvard Campaign); debt-service costs have been reduced; and a lot of capital spending has been completed, reducing the backlog of deferred maintenance. Beyond the benefits of continuity, the appointment is another major step in renewing the University’s financial leadership: as the vice presidency changes, the role of treasurer also will pass from Paul J. Finnegan to Timothy R. Barakett as part of a planned transition among members of the Harvard Corporation.
In another sense, however, Kalra brings to the CFO role a valuable outsider’s perspective. A graduate of the University of Pennsylvania’s Wharton School, she began a career in finance in 1996, and along the way pursued further education and, briefly, work in financial journalism. Before joining Harvard, she was a managing director at Goldman Sachs, where from 2007 to 2020 she rose through positions in public sector and infrastructure finance to become head of those responsibilities for the firm’s western region—and of its higher education finance practice nationwide. That span of responsibilities means that Kalra knows a lot about the financial circumstances and needs of a variety of higher education institutions, from borrowings to innovative strategies like disposing of or leasing out non-core assets such as parking facilities and campus power plants. (And as Harvard’s interests align with the Commonwealth’s on huge public projects like the Mass Pike realignment, with a cost exceeding $1 billion, she has pertinent expertise there, too.)
Those experiences have given her both deep exposure to markets and broad perspective on universities’ financial models and operations at a time of considerable stress: sharp changes in public institutions’ support from state governments, increased reliance on tuition income at unendowed schools, and volatile investment returns at private universities like Harvard that depend heavily on income disbursed from endowments. Perhaps because she has worked with clients as well as in journalism, Kalra communicates complicated financial information clearly and comfortably: an advantage in a community like this one, where budgets and finances can be unusually opaque, and the people who rely on them, like professors, are accustomed to asking lots of questions. (Before she came to work for the University in 2020, Pforzheimer professor of teaching and learning Richard J. Light, whose research focuses on higher education, invited Kalra to his Higher Education Leaders Forum to brief high-potential future academic leaders on finance in the sector: very successful sessions, by his account, and a revelation to the participants.)
The value of such communication skills shouldn’t be underrated. Part of Hollister’s success in reshaping the budget processes and culture around the University reflects his positive annual-report messages explaining how financial gains support the academic mission—and his warnings to be prudent when he directed planners to prepare a “recession playbook” in anticipation of harder times. The latter came in especially handy in early 2020, when the initial impacts of the pandemic seemed to threaten extreme financial difficulties; because the community was prepared for lean times, it was better able to stave them off. President-elect Gay’s strategic-planning effort for the Faculty of Arts and Sciences (FAS) is premised on both a rigorous examination of the faculty’s financial position and extensive discussion with the community as a whole about what that implies for its academic prospects. So perhaps that is a source of alignment between her operating style and the decision to elevate Kalra to the vice presidency.
Effecting a smooth transition in these senior finance roles, as President Lawrence S. Bacow concludes his service and Gay succeeds him, matters in several respects. The University’s financial performance during the past decade has put Harvard in the strongest financial condition since the financial crisis and Great Recession 15 years ago: a very favorable starting point for the new administration in Massachusetts Hall, and for deans eager to invest in their schools’ programs. The new president, VP/CFO, and treasurer also are, or wiil be, members of the board of directors of Harvard Management Company (HMC), which oversees investment of endowment assets—the largest source of University operating revenues. Hollister and HMC chief executive N.P. Narvekar jointly developed a new University investment risk policy: a key to future endowment asset allocations and potential returns, and another essential point for clear communication between customer (Harvard’s academic operations) and provider (the management company team), managed in significant part by the CFO and treasurer.
In the news announcement, Barakett said, “Ritu is very skilled at aligning strategic thinking with operational and organizational context, and that unique ability has been evident since she joined the University. I have no doubt she will continue to bring this same leadership to bear as she steps into this new role and, building on the strong relationships she has across the University, will be a thoughtful and highly effective partner in moving Harvard’s mission and priorities forward in the years ahead.”
As Gay approaches her busy first weeks leading the University, having a complete financial and investment management team in place and maintaining continuity with current operations ought to be a considerable comfort. She still needs to appoint three deans plus her own successor as FAS’s leader, and likely faces a Supreme Court ruling on admissions that could upset the College’s longstanding practices and pursuit of diversity—among other pressing priorities. Having the search for successor financial leadership resolved as she assumes ultimate responsibility for Harvard’s operations and balance sheet is a major item checked off the list.
In the intermediate term, for those who speculate about the next major fundraising drive (the Harvard Campaign concluded in mid 2018), the financial appointments may also underscore that the University in fact has plenty of breathing room. Absent some global cataclysm, Harvard’s fisc is in fine shape, and Gay’s administration is under no urgent financial compulsion to devote attention to that task from Day One—meaning that a campaign, when it does emerge, could be grounded in carefully planned academic priorities. (In a recent interview, she noted that FAS, after years of lean operations, is in strong financial shape; she is eager, she said, to see how her successor deploys its newfound resources: “It’s empowering, an opportunity maybe to take some risks.”)
Some mix of astute financial management, favorable market conditions, the successful capital campaign, and of course luck have contributed to the nicest kind of bequest from Bacow to Gay: freedom from immediate worry about the funds that keep the University, now a $6-billion-plus enterprise, ticking. From the community’s perspective, it is fortunate that the new president can focus on other priorities early in her tenure, as an experienced new Harvard team takes on management of the Crimson’s cash.