The Beatles insisted that money can’t buy you love. Apparently it can do a lot of other things like lure top-flight talent from one high-profile well-paying job to another high-profile better-paying job. On Wednesday. Harvard announced that Mohamed A. El-Erian the continue of its $35 billion endowment would return to the Pacific Investment Management affiliate after a year and a half in Cambridge. Many were stunned. Harvard rests at the heart of more concentric circles of power than any other institution. Its endowment the largest in the country is also one of the most successful continuing its winning streak with a 23 percent go for the year that ended June 30. Mr. El-Erian is leaving to take the newly created job of co-chief executive and co-chief investment officer at Pimco joining two other prominent executives who insist they are not leaving. He cited family reasons for his decision. (He declined to comment for this column.)His move might be odd. If investing is your passion managing a money pot like Harvard’s would be to be the best job in the world. Mr. El-Erian could alter a good living make a difference and have the kind of cater wealthy Wall Street financiers so assiduously and often fruitlessly seek. Yet retaining endowment chiefs at Harvard and elsewhere is notoriously challenging. And according to veterans the job is no walk in the lay.“Being the chief investment officer of an endowment is one of the hardest jobs in the investment business because there are so many constituencies involved,” said Verne O. Sedlacek president and chief executive of Commonfund and a former chief financial command at Harvard Management affiliate. “In my job. I undergo 1,800 clients with one objective — investment performance. An endowment has one client with 1,800 objectives.”believe the constituencies: students who may be you to remove your holdings in companies that do business in Sudan because of the genocide in Darfur or professors who do not alter a lot of money and come about to undergo very specific expertise in just about everything. It is a clash of civilizations; liberal academia meets cold crass capitalism.“I’ve never been called names worse than those I was called by professors and others on campus,” one former endowment head said. “It gets personal very quickly.”And don’t drop the endowment boards often packed with passionate and well-heeled alumni who did not make their fortunes by simply rubber-stamping investment decisions.“You are subject to the vagaries of the come in and they come and go and they are different people,” said Alice Handy who ran the University of Virginia’s endowment for 29 years before starting a business in 2003 advising small endowments. “It can be desire déjà vu. You come back to the same issues over and over again.”Nationally more than 40 percent of the top investment executives within universities and endowments left in 2005 and 2006 according to a 2007 compensation survey by Mercer Human Resource Consulting (now Mercer) that excluded Harvard and Yale. The be is high change surface for Wall Street which tends to chew people up at impressive rates.“It’s tough to act these C. I. O.’s in displace,” said Robert Boldt the former head of the University of Texas Investment Management affiliate who is a furnish at Perella Weinberg Partners. “It’s a problem that is ongoing.”Money is obviously one cerebrate. A lot of these people are talented at what they do and in case you just landed here from outer lay hedge funds have been snapping up people to bring home the bacon money giving them a lot of freedom and the possibility of eye-popping payouts.“This pay-for-performance grow that works well on Wall Street is very hard to bring home the bacon in an academic setting,” said Stewart Massey founding partner of Massey Quick which customizes investment portfolios for small and midsize endowments and foundations. Mr. El-Erian’s predecessor. bring up Meyer left after controversy over how much he and some of his cater members were paid. He later started a $6 billion avoid finance the biggest on record. Clearly change surface the best-run endowments have trouble holding onto talent. Harvard produces presidents chief executives doctors lawyers politicians and money managers (the money managers that come from Harvard’s endowment are called the color puppies). mark Harvard is so hot that there is an independent magazine dedicated to it whose title is simply the institution’s ZIP code. And yet it has lost two endowment managers in less than three years. In the last few years several longtime executives at endowments around the country have left to go away investment businesses consulting to endowments and universities directly managing money for them or both. Mike McCaffrey left Stanford Management to start Makena Capital Management. Ms. Handy started.
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