The Board of Harvard Management Company (HMC) announced on Oct. 14 that it has appointed Mohamed A. El-Erian president and chief executive officer of Harvard Management Company, commencing early in 2006.
El-Erian, 47, is currently a managing director at Pacific Investment Management Company (PIMCO), the institutional money manager specializing in fixed-income management with over $500 billion in assets under management. He is a senior member of the firm’s portfolio management and investment strategy group. Among his responsibilities, he managed more than $28 billion in emerging market debt as head of the firm’s emerging market portfolio management team, as well as other bond portfolios in domestic and global fixed income.
“Harvard’s endowment is critical to the University’s academic and financial aid programs and to its capacity for growth,” said Lawrence H. Summers, president of Harvard University. “We are pleased to welcome Mohamed to Harvard and are confident that under his leadership, the endowment will continue to be overseen and invested with the highest level of professionalism and expertise. Among Mohamed’s many attributes are his intelligence, global perspective, and commitment to excellence – all of which will serve HMC and Harvard University well in the coming years.”
El-Erian said, “I am delighted to be coming to Harvard and to have the opportunity to play a significant role in the life and growth of this university. At Harvard Management Company, I join a strong, vibrant, and innovative organization. I look forward to working closely with HMC’s Board of Directors and its talented professionals in charting HMC’s future in support of Harvard University’s mission. I leave at PIMCO a great team of professionals who will no doubt continue to excel in all types of domestic and global fixed-income management.”
James F. Rothenberg, treasurer of Harvard University and chairman of the HMC Board, said, “We have found in Mohamed El-Erian not only an exceptional investment professional, but an individual whose interests and career-long pursuits have given him a tremendous appreciation for what it means to lead a mission-driven organization. In his six and a half years at PIMCO, he has emerged as a savvy investor with a particular knack for identifying opportunities in complex markets, while developing a reputation as a strong and articulate leader. His engagement with the broader economic community provides Mohamed with perspective on global markets and the role of capital throughout the world. We believe he possesses the right combination of skills and experience to lead HMC to continued success, and the HMC Board of Directors is looking forward to working closely with him over the coming years.”
Regarding El-Erian’s departure, PIMCO CEO Bill Thompson said, “Mohamed has made many significant contributions to PIMCO, and it has been a pleasure for us to work with him. It is an honor for us knowing Mohamed will be leading HMC, with the largest university endowment in the world, as well as teaching and inspiring students at the Harvard Business School.”
El-Erian succeeds Jack R. Meyer, who concluded his service as president and CEO of HMC on Sept. 30. “The contributions to Harvard by Jack and the HMC team over these past 15 years have been nothing short of remarkable,” said Summers. “Generations of Harvard students and faculty will benefit from the investment successes they achieved, and we wish Jack and his colleagues well in their new venture.”
HMC Board member Peter Nadosy, former president of Morgan Stanley Asset Management, who has been serving as interim chief investment officer since Meyer’s departure, will continue as CIO until El-Erian assumes his position on a full-time basis. Until he joins HMC, El-Erian will be working at PIMCO to ensure a smooth transition for PIMCO’s clients and for the firm.
In addition to assuming the president and chief executive officer roles at HMC, El-Erian will also serve as a member of the faculty of Harvard Business School and as deputy treasurer of the University, providing advice to the president, chief financial officer, and other administrators on Harvard’s management of its financial resources.
Established in 1974, HMC is the separately incorporated Harvard affiliate responsible for the investment of the University’s endowment assets and certain other funds. In fiscal 2005, the Harvard endowment achieved a total investment return of +19.2 percent, net of all expenses and negotiated fee offsets. This return, when combined with gifts and spending, resulted in an endowment value of roughly $25.9 billion as of June 30, 2005.
El-Erian joined PIMCO in May 1999 as executive vice president and senior emerging markets portfolio manager. From 1998 to 1999, he served as managing director heading the emerging markets economic research team at Salomon Smith Barney/Citibank in London. He spent 15 years, from 1983 to 1997, with the International Monetary Fund (IMF), leading policy work on debt and country issues. He has published widely on international economic topics.
El-Erian has served on several boards, including the Emerging Market Traders Association (EMTA), the Emerging Markets Creditors Association (EMCA), and the International Center for Research on Women. He is also a member of the IMF’s Capital Markets Consultative Group.
El-Erian earned a B.A. in economics from Cambridge University and doctoral and master’s degrees in economics from Oxford University.