(May 22, 2014) — Princeton University paid its top three endowment managers a total of $8.3 million in 2013, a 39% bump from 2012 compensations.
According to the New Jersey-based university’s tax return, Andrew Golden, the president of Princeton University Investment Corporation (PRINCO), was the highest paid employee in 2013. The 55-year-old leader of the $18.2 billion endowment received $3.9 million in total compensation last year, compared to $2.7 million in 2012.
Jonathan Erickson, a managing director at PRINCO, was the second highest paid employee who was paid $2.8 million this year. In 2012, he received $1.85 million. Drew Riedl, another managing director, collected $1.6 million in 2013.
Martin Mbugua, a spokesperson for Princeton, said the university was unable to comment on the reported compensations.
The endowment—managed using the Endowment Model—returned 11.7% in fiscal year 2013, falling in line with returns for other Ivy League institutions for the year. Its 10-year annualized return increased to 10.2%.
“The perspective is that we made that return the hard way,” Golden said in October. “We executed well on a reasonably complicated, global, multi-asset class, investment approach.”
However, despite its affinity to illiquid investments, last month the endowment announced a plan to add more liquid assets to its portfolio creating a strategy called “Princeton Prime.”
According to the treasurer’s report, PRINCO said the endowment would have produced better returns “if we had kept [our asset allocation strategy] simple. Indeed, ‘simple’ has beaten ‘complex’ over the most recent five-year span.”
In addition, PRINCO said it hoped to reallocate its assets more broadly in the coming years by upping its exposure to domestic equities to 8% and international developed markets equities to 6%. Target allocations to fixed income and cash were reduced from 6% to 5%.
“It would be unwise to develop budgets that depend on returns resembling the bull markets of the 1990s,” the report said. “In the decade ahead, we will need to manage growth with careful attention to optimizing resources to best support our priorities.”
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