Williams has a new Chief Investment Officer.

Williams College has put the final piece of the upper level management in place, hiring Boston-based investment executive Collette Chilton as its first chief investment officer to oversee its roughly $1.5 billion endowment.

Chilton is president and chief investment officer of Lucent Asset Management Corp., which manages the pension and 401(k) funds of the telecom corporation Lucent Technologies Inc.

Hmmm. I have been somewhat suspicious of the move to hire a CIO. Why mess with a system that is working well? Moreover, as Trustee Laurie Thomsen pointed out at the Boston Alumni meeting in April, the real secret behind the success of the endowment has been the committee of Ephs who have run it. They have ensured that Williams gets into all the best deals. Presumably, this will continue, but I worry.

Chilton certainly has the sort of resume that one would look for. (She was probably due to be forced out of Lucent as Alcatel takes over in the next year.) And, even better, her non-trivial salary will make other administrators seem cheap by comparison. She talks sense in this interview.

CPEE: What impresses you in a job candidate?

Chilton: People in an interview situation need to have a clue about what they are talking about! You would be surprised at how many people just haven’t done the research and don’t even understand the job they for which they are interviewing. People come in and don’t really know the role investment managers play within a company, or what assets we oversee–really basic stuff.

One thing not to do is to come in and say, “I’ll take this entry-level job for now, but in two years I should have your job!” Job candidates have to have a clear, realistic sense of what they want to do, both short-term and long-term.

Very true. The Eagle goes on with:

The post was created by the reorganization of the school’s upper-level management, which has been ongoing for a year.

Chilton said that having an investment office is important when you have enough assets to oversee.

“Having someone whose responsibility day in and day out is to oversee and invest it and all the myriad details that go with that is more than a full-time job,” she said.

Then why was the endowment’s performance over the last 10 years so outstanding?

“They clearly did an outstanding job (resulting in double-digit annual growth), but the volume and complexity of overseeing an increasingly large portfolio rendered that model unsustainable,” President Morton O. Schapiro wrote in a letter making the announcement. “With a chief investment officer, Williams will for the first time have an experienced professional overseeing on a day-to-day basis an operation of great importance to all that we do at the College and all that we’ll be able to do in the future.”

Perhaps. As long as the focus continues to be on getting access, via plugged in Ephs on the Finance Committee, to the best deals, I am satisfied. Indeed, Chilton might play a useful role as score-keeper, reporting on which deals have paid off the best for the College. Rich Ephs can be quite competitive in their desire to do well for Williams.

At about $1.5 billion, the college’s endowment is one of the largest in the nation for a small liberal arts school.

There are some limits to how the money can be invested. In June, the trustees chose not to invest in 28 multinational corporations that do business in Sudan, as part of an effort to stop the government-sponsored genocide in that country’s Darfur region.

Gibberish! The Eagle reporter, Chris Marcisz, is smarter than this. The trustees chose not to invest directly in these companies. The College has so few direct stock holdings that this doesn’t matter. The College did not promise to stop investing in hedge funds and other pooled vehicles which themselves invest in companies which do business in Sudan. For all anyone knows, those hedge funds have millions of dollars invested with those companies.

The entire Sudan Divestment schtick is moral preening, devoid of investment substance.

Best part is that Alcatel — the company that is in the process of buying Lucent and, I think, indirectly leading to Chilton’s departure — is on the Sudan list! Maybe Chilton quit for moral reasons! She couldn’t stand the thought of working for a company which does business with the government of Sudan.

She’ll be based in Boston and will have an office at Williams.

I am jealous.

Facebooktwitter
Print  •  Email