(October 30, 2013)—Thomas “Britt” Harris, CIO of the Teacher Retirement System of Texas and longtime asset-management industry stalwart, will be the 2013 recipient of aiCIO’s Lifetime Achievement Award.
Previous winners of this award include NISA Investment Advisors’ Jess Yawitz and Bill Marshall (2011), and Strategic Investment Group’s Hilda Ochoa-Brillembourg (2012).
Harris, a Texas A&M graduate, began his career with stints at energy company Texas Utilities and power/automation giant ABB.
He then moved to Verizon Investment Management, which oversees the company’s employee benefit investments, as CIO. There, he ran a team of investment professionals responsible for billions in retirement assets—one known as a pension investment talent incubator.
One product of Harris’ unit is Robin Diamonte, current CIO at United Technologies. Of her time working under Harris at Verizon, she said: “Working with Britt was like a being on Star Trek’s Starship Enterprise: You never knew what brave new world he was going to want to explore next.
“At Verizon, we had researchers, portfolios managers, traders, and strategic partners all waiting for the next idea. We were never quite finished implementing one strategy, before we were all charging off to go analyze the next opportunity.”
In 2004, Harris left Verizon to become CEO of Ray Dalio’s Bridgewater Associates, the world’s largest hedge fund. While his tenure at the Westport, Connecticut-based fund was short, his involvement with the firm would endure: in 2012, Texas Teachers (with Harris as CIO, although he recused himself from much of the process to avoid conflicts) would invest $250 million to buy a stake in Dalio’s enterprise.
Following Bridgewater, Harris decamped for the $115 billion Austin-based Teachers’ fund. There, among other successes, he has moved the fund aggressively into strategic partnerships with some of Wall Street’s biggest names. For example, private-equity giants KKR and Apollo Asset Management both received $3 billion from the fund in 2011 in what Harris refers to as “strategic partnerships.”
“These firms, they’re just so much more than they were 15 years ago,” he told aiCIO in 2012. “You hear of the Barbarians at the Gates days—what were these firms then? The answer was that they were doing US-only leveraged buyouts, and they were private. Today, they are global, they have multiple product lines, and they’re public. Really, this is still just the tip of the iceberg on these things.”
“We have seven strategic partners at the moment,” he said at the time. “Strategic partnerships mean different things to different people, of course. For us, we want to work with partners with multiple high-quality products and services. They must be able to customize those talents for our fund and our risk profile.
“They have to be global, they must be research-intensive, they have to share resources, the top people have to be engaged, and they have to have a comparable compensation philosophy—we’re performance-oriented people, and our key relationships must be too.”
Regarding the Bridgewater stake, Harris noted that it wasn’t even the largest deal of its type for the fund. ““With [our internal] team, firms [looking to find investors] can come to us now. They know they’ll get a good look confidentially, and that the outcome will be mutually beneficial. And they know it’s going to be quick,” he said. The deal, he noted, “was obviously unique, given my history with them. But we’ve made 10-15 principal transactions. Bridgewater isn’t even the largest one.”
Harris is candid about the strengths of public capital that allow Texas to pursue such investments. “When you talk about building a world-class asset-owner organization, you need to focus on the relative strengths,” he said. “Ours are obvious: We are large, very long term, liquid, and not very levered.”
Harris currently sits at #6 in aiCIO’s Power 100 Rankings. He will receive the award at the fourth-annual aiCIO Industry Innovation Awards on December 9, held at the New York Public Library.
Related Content: Texas Teachers’ Strategic Partners Beating Own Alpha Benchmark and Bloomberg News Took a Swing at Britt Harris… and Sort of Missed