New York University Endowment Loses CIO | Chief Investment Officer

New York University’s (NYU) endowment will be short a CIO in the coming year with the departure of current chief Tina Surh.

The university confirmed that her resignation from the $3.5 billion fund would be effective December 31, 2014.

“Tina has dedicated herself to NYU’s success and has been integral to our efforts to build and protect the endowment,” said Martin Dorph, executive vice president of finance. “She has played a leading role in building the investment function from the ground up and driving substantial development across all aspects of the endowment’s portfolio and management.”

Surh was promoted to CIO in 2009—four years into her career at NYU—inheriting a fund that had lost 11% that fiscal year. As CIO, she also worked closely with hedge fund magnate and former chairman of the endowment’s investment committee Michael Steinhardt.

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“Together with my colleagues and the indispensable guidance of the board, we accomplished an incredible amount in creating the NYU endowment’s growth platform while at the same time ensuring it would be resilient to the stresses of the global financial market,” Surh said.

During her tenure, the endowment more than doubled in size from $1.5 billion to $3.5 billion. The university also said the fund returned 8.5% annually for the five years ending September 31, 2014, “meaningfully outperforming its long-term policy benchmark return of 7.1%.”

The endowment returned 13.7% in the fiscal year ending August 31, 2014.

Prior to NYU, Surh worked on manager research and selection with Princeton University’s endowment. She also served as a direct private equity investor with middle market buyout and growth equity investment manager DCMI and began her career as a strategy consultant at Bain & Company.

The departing CIO holds a bachelor’s degree from Tufts University and an MBA from Harvard Business School.

According to NYU Local, a news blog run by NYU students, Surh earned $690,265 in 2013.

NYU’s spokesperson confirmed that the university has begun a search for Surh’s successor.

The Norway Pension Fund Global should reject calls to dump fossil fuel investments and concentrate instead on working with the worst offenders, according to its advisory board.

The country’s finance ministry asked the board to evaluate whether divesting from coal and petroleum companies was a “more effective strategy for addressing climate issues and promoting future change than the exercise of ownership and exertion of influence.”

The panel of international investment experts concluded that the fund—despite being one of the world’s largest investors—has minimal power over climate change. Becoming a force for environmental causes would mean changing its mandate and fiduciary duty to Norwegian citizens, the board stated in an extensive report published today.

“We do not think that it would be better for the climate—or the fund—if these shares were to be sold to other investors who, in all probability, will have a less ambitious climate-related ownership strategy than the fund,” the advisors said.

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Although funded by the nation’s oil wealth, the organization has been a leader in ethical investment since inception, pushing on governance as well as environmental and sustainability targets.

However, the portfolio is an “inappropriate and ineffective climate change tool,” the report said. “Neither exclusion nor the exercise of ownership can be expected to address or affect climate change in a significant way.”

Furthermore, the board warned that attempting to halt or slow climate change via the $800 billion fund could threaten future returns.

Instead, the board proposed changing its investment guidelines to permit excluding companies that “operate in a way that is severely harmful to the climate.”

It also said the fund should not discount climate change as a risk overall. The factor should play a part in investment decisions, but with the understanding that its impact on big-picture outcomes will likely be limited.

Finally, the board encouraged staff to create a better information exchange between the Council of Ethics and fund managers to monitor climate change risk in portfolios and highlight companies at high risk of violating the new climate criterion.

“We are mindful of the importance of the broader climate issue, as well as of the importance of a well-managed fund for the present and future citizens of Norway, and look forward to a broad and open discussion of our recommendations,” the board concluded.