News

Mass. State Rep. Calls on University VP to Increase Transparency for Allston Multimodal Project

News

Harvard President Lawrence Bacow Made $1.1 Million in 2020, Financial Disclosures Show

News

Harvard Executive Vice President Katie Lapp To Step Down

News

81 Republican Lawmakers File Amicus Brief Supporting SFFA in Harvard Affirmative Action Lawsuit

News

Duke Senior’s Commencement Speech Appears to Plagiarize 2014 Address by Harvard Student

Harvard Management Company Natural Resources Team — Once Blamed for Low Returns — ‘Spins Out’

The Harvard Management Company, housed in the Boston Federal Reserve building, manages Harvard's endowment and related financial holdings.
The Harvard Management Company, housed in the Boston Federal Reserve building, manages Harvard's endowment and related financial holdings. By Amy Y. Li
By Ellen M. Burstein, Crimson Staff Writer

Harvard Management Company’s natural resources team spun out into an independent investment firm, according to a message CEO N.P. “Narv” Narvekar sent to HMC affiliates Thursday.

Colin Butterfield, HMC’s former natural resources chief, will head the new firm, Solum Partners.

The split marks a milestone in Narvekar’s five-year plan to restructure the University’s investments. The natural resources team was the only remaining group of employees managing an asset class internally.

In his message to affiliates, Narvekar praised Butterfield’s work at HMC, where he has worked since 2016.

Under Butterfield’s leadership,“the NR team immediately developed a robust set of sustainable investing guidelines to ensure that those tasked with operating our investments act as responsible stewards of the environment, their employees, and the communities in which they operate,” Narvekar wrote.

In his message Tuesday, Narvekar cited two justifications for the outsourcing.The move allows HMC to retain exposure to desirable aspects of its natural resources portfolio, while providing the investment team with “a pathway for growth,” he wrote.

Narvekar noted that Harvard will “continue to work closely” with the team at Solum as investors and advisors on the management and sale of the University’s remaining natural resources assets.

Harvard maintains the largest University endowment in the world. In a memo last week, Narvekar announced that the endowment returned 7.3 percent on its investments for FY2020, bringing its value to a record $41.9 billion.

Narvekar has long sought to decrease the University’s investments in natural resources, an “illiquid asset” that yielded persistent low returns. He wrote that HMC had decreased its investments in natural resources during his tenure from 9 to 4 percent of overall investments.

Despite those efforts, in 2019, Harvard returned negative 12.4 percent on its investments in natural resources, marking the lowest returns of any asset class. At the time, Narvekar blamed the illiquid assets for “disappointing” overall returns for the endowment.

—Staff writer Ellen M. Burstein can be reached at ellen.burstein@thecrimson.com. Follow her on Twitter @ellenburstein.

Want to keep up with breaking news? Subscribe to our email newsletter.

Tags
University FinancesUniversityFront FeatureUniversity NewsFeatured Articles