Columbia University Endowment CEO to Step Down

Peter Holland, Columbia Investment Management Company CEO and president, will retire as head of the $11 billion endowment effective Sept. 30, 2020, Columbia University said.

“It has been a privilege to steward the financial resources that make it possible for Columbia to expand access to students, recruit extraordinary faculty and broaden the University’s global impact,” Holland said in a statement. “Leading the IMC team and serving President Bollinger and our dedicated Trustees has been a unique and enormously rewarding experience.”

The announcement comes just a few months after the endowment’s CIO Tim Donahue left Columbia to become CIO of Hawaii’s Kamehameha Schools’ endowment; COO Sanjeev Daga left the endowment just over a year ago to join former Columbia endowment CIO Narv Narvekar at Harvard Management Company.

It also follows a dismal year for the endowment’s investment portfolio, which returned only 3.8% 2019 and underperformed every other Ivy League endowment.

Never miss a story — sign up for CIO newsletters to stay up-to-date on the latest institutional investment industry news. 

Columbia President Lee Bollinger has appointed a committee to launch a national search for Holland’s successor. He said Andrew Barth, chairman of Columbia Investment Management Company, will serve on the search committee along with several current and previous trustees of the institution.

“For the past 17 years, Peter Holland has been integral to the growth of Columbia’s endowment and to securing long-term returns that place Columbia among the top of our peer group,” Barth said in a statement.

Holland has been a member of the executive team at Columbia Investment Management Company since 2003. Prior to joining Columbia, he worked at J.P. Morgan for 15 years, primarily in the US equities derivatives group, serving as co-head of the group from 1998 until joining Columbia.

Columbia Endowment Chief Heading to Hawaii

Harvard Endowment Poaches Columbia COO Sanjeev Daga

Tags: Andrew Barth, Columbia Investment Management Company, Endowments, Lee Bollinger, Peter Holland, resignation

Northrop Grumman has ended a 13-year legal battle by agreeing to pay $12.4 million to settle a class action lawsuit filed on behalf of the Northrop Grumman Savings Plan. The suit claimed the aerospace and defense company breached its fiduciary duty under the Employee Retirement Income Security Act (ERSIA).

The plaintiffs alleged that administrators of the company’s 401(k) plan engaged in prohibited transactions by distributing plan assets to Northrop as payment for administrative services and investment-related services it provided to the plan.

They also said Northrop paid unreasonable fees to the plan’s record-keeper Hewitt Associates, and failed to remove an underperforming actively managed emerging markets equity fund. Northrop also was accused of engaging in prohibited transactions in hiring and paying third-party service providers and failing to properly monitor the plan’s fiduciaries.

In the original complaint, the plaintiffs said Northrop’s directors and officers acted on behalf and for the benefit of the company, not the plan or its participants.

Never miss a story — sign up for CIO newsletters to stay up-to-date on the latest institutional investment industry news. 

It said that rather than comply with their fiduciary obligations they “acted to benefit themselves and Northrop by paying plan assets to Northrop purportedly for administrative services Northrop provided to the plan, which were not necessary for administration of the plan or worth the amounts paid.”

The plaintiffs said that from 2009 through 2013, Northrop received between $1.7 million and $2.1 million per year from the plan, and that through 2015, Northrop had taken nearly $10 million from the plan.

“Had defendants performed their fiduciary duties, the plan would not have suffered over $13 million dollars in losses from mid-2009 through 2015,” said the complaint, adding that Northrop essentially hired itself “to provide purported administrative services, which served as a scheme to direct plan assets to Northrop that were not payments reasonably related to any service the plan needed or was provided.”

Court documents showed the settlement was the product of “extensive arm’s-length negotiation,” until the parties reached a deal after numerous mediation sessions and only after completing their trial preparations.

Under the settlement’s plan of allocation, the actual recovery per person will depend on the number of class members who are eligible for an award and their average account balances during the class period.

Current participants will automatically receive their distributions directly into their tax-deferred retirement accounts, while former participants will be allowed to receive their distributions in the form of a check made out to them individually or as a rollover into another tax-deferred account.

Michigan Police Pension Files Securities Lawsuit Against Prudential

Trader Joe’s Retirement System Hit with Lawsuit Alleging ERISA Breaches

Tags: 401(k), ERISA, Hewitt Associates, Lawsuits, Northrop Grumman, Settlement