Britt Harris, UTIMCO Nab Harvard’s Head of PE

Rich Hall, who left Texas Teachers’ for Harvard, returns to Texas to join UTIMCO as deputy CIO. Harris says, "There are no near term plans to alter the endowment’s basic asset allocation at this time."

Rich Hall

Rich Hall, Harvard Management Company’s (HMC) head of private equity, has given his notice: he’s returning to Texas (and to Britt Harris) — but this time to the $40 billion University of Texas Investment Management Company (UTIMCO) as deputy CIO.
UTIMCO President, CEO, and CIO Britt Harris , hired August 1 from Teacher Retirement System of Texas, worked with Hall in the past at TRS where Hall had been a manager.

Harris told CIO, “Rich is coming to UTIMCO because of his strong leadership skills, successful investment career, his experience as a culture carrier of the highest order and his passion for the mission that we have at UTIMCO. That mission is to invest effectively to help irradiate poverty through education, enhance society though Research and to help cure and care for those with cancer and other significant medical needs.”

UTIMCO had put its private equity expansion on hold in September due to higher valuations and a potential need for more liquidity.
When asked if Hall’s expertise in private equity was related, Harris responded, “There are no near term plans to alter the endowment’s basic asset allocation at this time. Rich’s purview will expand well beyond private markets which are fully valued at the present time.”

Hall is leaving Harvard during a time of vast restructuring. In a financial report earlier this year, Harvard CEO Narv Narvekar had noted, “today’s market landscape makes it ever more difficult to attract and retain top portfolio managers.”

Narvekar took the helm in December 2016, and HMC has been swiftly changing from a more siloed approach which includes largely exiting internal management of public markets assets, announcing plans to lay off half of its staff of 230, stalling fossil fuel investments, shutting down the relative value platform, repositioning the credit platform to be managed, in part, internally, and setting expectations to spin off the real estate platform. In HMC’s annual report, the CEO wrote, “In a perfect world, we would have moved through these changes over a much longer period. However, given the time needed for these changes to impact results, the HMC Board of Directors and I strongly believe that HMC will be in a far better position by moving quickly.”

The $37 billion endowment faced what Narvekar called “disappointing” 8.1% returns in 2017, noting in the annual report, “The endowment’s returns are a symptom of deep structural problems at HMC and the resultant significant issues in the portfolio.”

Hall’s last day will be Feb. 2, and his replacement has not yet been announced.
In a memo to staff obtained by CIO, Narvekar said:

“Since joining HMC from the Teacher Retirement System of Texas in 2014, Rich has proven himself to be a talented investor, a responsible steward of the University’s resources, and a wonderful colleague. He also played an integral role in adapting our team to the generalist model over the past year. Rich’s contributions leave us well-positioned for the future. We will miss having him as a member of our team, but we’re excited for his new opportunity.”

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Tags: Britt Harris, Harvard, Narv Narvekar, UTIMCO

The $221.7 billion California State Teacher’s Retirement System’s (CalSTRS) Director of Corporate Governance Anne Sheehan has released a statement regarding a recent letter issued to Apple Inc.

The letter, co-written by CalSTRS and hedge fund Jana Partners LLC, calls for Apple to address the issue of young people becoming addicted to iPhones by offering parents more choices and tools to their children.

“By doing so, we believe Apple would once again be playing a pioneering role, this time by setting an example about the obligations of technology companies to their youngest customers. As a company that prides itself on values like inclusiveness, quality education, environmental protection, and supplier responsibility, Apple would also once again be showcasing the innovative spirit that made you the most valuable public company in the world,” the letter reads.

“In fact, we believe that addressing this issue now will enhance long-term value for all shareholders, by creating more choices and options for your customers today and helping to protect the next generation of leaders, innovators, and customers tomorrow.”

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CalSTRS and Jana collectively own $2 billion worth of shares in the tech giant.

“As active and long-term shareholders of Apple Inc., CalSTRS and Jana Partners LLC sent the corporation a letter asking them to address the growing need to offer parents more choices and tools to help ensure that young consumers are using their products in an optimal, supportive manner,” Sheehan said. “We believe that by doing so, Apple will enhance long-term value for all shareholders, by creating more choices and options for their customers today and helping to protect the next generation of leaders, innovators, and customers tomorrow.

While conducting research on the situation, CalSTRS and Jana partnered with experts Dr. Michael Rich, founding director of the Center on Media and Child Health at Boston Children’s Hospital/Harvard Medical School Teaching Hospital and Associate Professor of Pediatrics at Harvard Medical School, and Professor Jean M. Twenge, psychologist at San Diego State University and author of the book iGen.

Professor Twenge’s research indicated that US teenagers spending three or more hours a day on their mobile phones were 35% more likely to have a suicide risk factor than those who spend less than an hour. That number increased to 71% for those who spent five or more hours.

Twenge’s research also found that eighth-grade students heavily using social media are at a 27% higher risk for depression as opposed to young children engaging in more social activities and homework, who were at a significantly lower risk.

This behavior also affected sleep, as teens on electronic devices for five or more hours a day were 51% more likely to get fewer than seven hours of sleep as opposed to those using their devices for less than one hour.

Additional studies referenced in the letter included a study from UCLA, where researchers saw children performing “far better” on empathy tests than a control group after five days at a device-free control camp. Another form of research used was a survey from the American Psychological Association, where of the 3,500-plus parents surveyed, 58% worried about the influence of social media on their child’s physical and mental health, 48% had issues regulating their child’s screen time, and 58% felt that their child was “attached” to their phone or tablet.

In her statement, Sheehan summed up the demands of the letter.

“We specifically ask that Apple form a committee of experts and specialists to research and study this issue and monitor ongoing developments in technology,” she said. “Additionally, we encourage Apple to offer parents more tools by enhancing mobile device software to enable age-appropriate setup options including limiting screen time, setting up parental monitoring, etc. This also includes parental education on the available research and options available to help them make more informed decisions on their child’s device usage. We want to ensure stakeholders and experts have a seat at the table as Apple develops these new tools and options moving forward.”

Tags: Apple, CalSTRS, Jana Partners LLC