University of Notre Dame endowment’s (AUM $9.4 billion) Chief Investment Officer (CIO) Scott Malpass, Yale University endowment’s ($27.2 billion) CIO David Swensen, and Columbia University endowment’s ($10 billion) CIO Peter Holland took home the most income among endowment CIOs in 2015 (the most recent period for which this data is available), at $4.3 million, $3.9 million, and $3.8 million, respectively, according to the executive search firm Charles A. Skorina & Company.
“Compensation is a delicate issue, but recruiters need to keep track of it. And, we see no reason why we shouldn’t share some of that bounty with our readers,” Charles Skorina, the firm’s principal, wrote in an introduction to a report on CIO pay at 74 top schools, published by the firm last week.
Skorina noted that most of the compensation information is publicly available, but requires time and leg work to gather. He said private schools and some publics disclose compensation in Internal Revenue Service filings. “The hitch is the long time-lag—more than two years—before the data is publicly available. The corresponding data for most public schools is often fresher, but it’s scattered among various and often quirky databases in various jurisdictions with various disclosure rules,” he said.
The report includes a chart that presents W2 numbers only, paid in calendar year 2015 and taxable to the CIO. The firm used $1 billion in assets under management AUM as the lower bound for the compensation ranking.
Skorina acknowledged that the two-year lag in compensation reporting is less than ideal, but that they are the best numbers available based on the IRS filings. “We wanted [the compensations numbers] to be a book-end to our reporting of investment performance for FY2017. Accordingly, we wanted to list only CIOs who were the managers-of-record for that period so that pay could be usefully compared to performance. But, obviously, we could only report pay for CY2015 if the CIO had held the same job in that prior period.”
The lowest paid three endowment CIOs on the list, all of whom manage assets of less than $2 billion, are Raymond “Rip” Mercherle at University of Tennessee ($1.2 billion) at $186,000, Stephen Dahnert at Vassar College ($1billion) at $176,000, and Brian Neale at University of Nebraska Foundation ($1.6 billion) at $169,000.
Whither Harvard U.?
Conspicuously absent from Skorina’s compensation ranking is Harvard University. Skorina writes that the firm wanted to list only CIOs who were the managers-of-record for the FY2017 period so that pay could be usefully compared to performance. But, given that the report is limited to 2015 compensation, it could only list the CIO if he or she held the same job in that period. Harvard’s CIO-of-record in FY2017 was Narv Narvekar. But he was hired in late 2016, and he had no pay for that position in CY2015, the report says. “The CIO back in CY2015 was Stephen Blyth, who had total comp. of $14.8 million. Most of that consisted of a $13.6 million bonus. It would be highly misleading to ascribe that comp. to Narvekar, so we didn’t. While Harvard is the most conspicuous case, a few other CIOs are also MIA in this chart for similar reasons,” the report said.