Stephen Blyth Resigns From Harvard Management Company

Jul 27 2016 | 10:10pm ET

Stephen Blyth, CEO of Harvard University’s $37.6 billion endowment, is stepping down effective immediately, the famed university said on Wednesday.

Blyth, who became CEO of Harvard Management Company (HMC) a year and a half ago, moved quickly to rectify lagging returns by revamping staff, broadening investment flexibility and directing more capital to outside managers. He resigned for personal reasons, according to HMC, and had been on temporary medical leave since May.

HMC said COO Robert Ettl will remain as the endowment’s interim chief executive officer, and David Barrett Partners has been engaged to conduct a search for a permanent replacement for Blyth. 

Blyth, who has a Ph.D. in statistics from Harvard and is also a professor in the field for the university, joined HMC in 2006 after serving as head of the global rates proprietary trading group at Deutsche Bank in London. Before assuming the CEO title in January 2015, he was head of internal management and head of public markets for HMC. 

In addition to teaching, Blyth will serve as a senior advisor to the endowment’s board, according to HMC’s statement. René Canezin, HMC’s head of public markets and natural resources, and private equity head Richard Hall will continue to co-chair HMC’s Investment Committee during the interim period. 

“The Board is deeply grateful for Stephen’s many contributions during his distinguished ten-year career at HMC, particularly in his most recent role as President and CEO where he created a more flexible asset allocation framework, a redesigned compensation system, and a collaborative investment decision structure,” said Paul Finnegan, chairman of the HMC Board, in the statement. “We understand and support Stephen’s decision to step down for personal reasons. We wish him well in his future endeavors and look forward to his continued contributions as senior advisor.” 

Despite Blyth's overhauls, the endowment still faces difficult comparisons when it comes to relative returns. HMC’s returns have averaged 10.5% annually over the last five years as of June 30, according to Bloomberg, compared with the 14% earned by arch-rival Yale’s endowment. For the year to date, HMC is up 5.8%, compared with Yale’s 11%.

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