Robert Kaplan, professor of management practices at the Harvard Business School, began his term Monday as interim chief executive officer of the Harvard Management Company, the group tasked with managing Harvard's nearly $35 billion endowment.
Kaplan will replace Mohamed El-Erian, who will return to the $500-billion Pacific Investment Management Company at the end of the year after a tenure of less than two years at HMC. During the next month and a half, Kaplan will work alongside El-Erian to ensure a "smooth transition" as Kaplan completes his teaching responsibilities for the semester, Harvard spokesman John Longbrake wrote in an e-mail to The Herald.
Kaplan said in a Harvard press release that he would accept the position but stressed that it is only a temporary appointment. "I am looking forward to working with the extremely talented team at HMC," Kaplan said. "Their work makes a great contribution to the essential research and educational mission of Harvard, and I am pleased to be a part of this dynamic organization until a permanent CEO is named."
Kaplan has served as vice chairman of the Goldman Sachs Group, where President Ruth Simmons serves on the board of directors. He is currently a senior director of Goldman Sachs, was a member of its management committee from 2002 to 2006 and served as global co-head of the firm's investment banking division from 1999 to 2002.
Under El-Erian's leadership, the endowment posted a 23 percent return for the 2007 fiscal year, growing to $34.9 billion, according to an Aug. 23 article in the Harvard Gazette. The return was one of the strongest the Harvard Management Company has posted in its 33-year history, the article said.
Under El-Erian, Harvard's investment strategy included diversification into real assets, domestic and foreign equities and absolute returns, which include hedge funds and strategies such as fixed income arbitrage, according to the HMC Web site. Since 2000, when the HMC was under the direction of Jack Meyer, the company has dramatically increased its asset allocations in real assets and absolute return investments.
HMC's percentage allocation in the category of absolute growth opportunities, roughly 20 percent of its endowment, and in real assets both mirror Yale's endowment asset allocation. Yale University posted the highest investment return among universities of its size in Fiscal Year 2007 with a return of 27.8 percent, according to a Sept. 27 article in the New York Times.
