Financials

Oxford’s £6bn endowment fund hit by staff exodus

Oxford university’s £6bn endowment fund has lost half of its investment staff over the past 18 months, marking a rare period of turbulence at the institution just as global markets sour.

The exodus has rattled investors in Oxford University Endowment Management and highlighted concerns over the management style of Sandra Robertson, its chief executive and chief investment officer, insiders and people familiar with the fund told the Financial Times.

Established in 2007 to manage charitable money, OUEM is one of the largest endowments in the UK and has forged a reputation for consistently delivering stable returns.

Oxford university accounts for about half of its assets and OUEM runs money for individual Oxford colleges, including Christ Church, Brasenose and Balliol. Other institutions such as Radley College and the Wolfson Foundation are investors.

The highest-profile departure is that of Jack Edmondson, the fund’s highly regarded deputy chief investment officer, who had been at the organisation since 2009 and resigned in July. David Harling, investment director since 2014, also quit last month, while two investment managers, Will Tomsett and Shivani Oberoi, left earlier this year. Robert Godfrey quit as head of property investments to join real estate group Savills in February 2021.

The endowment, whose board is stacked with luminaries from the worlds of business and finance, has been run by Robertson since it was founded.

One investor described Robertson’s leadership as “hierarchical” and a former employee characterised it as “my way or no way”. Several people close to the endowment said she had not given her team enough autonomy or credit, and that investors had been concerned about a lack of transparency regarding the fund’s holdings.

Frustrations with Robertson have been bubbling for a number of years but have increased as her tenure lengthened, culminating in the recent spate of departures, said people familiar with the matter. Others close to the fund said that the coronavirus pandemic had crystallised ambitions to move jobs.

A spokesperson for OUEM said: “A natural part of having an exceptionally talented team is that some members will depart to do great things elsewhere. We are proud of the training we provide and the way our team members grow and develop.” Robertson did not respond to questions sent through OUEM.

Oxford endowment fund’s performance and exposure

Until the past 18 months, OUEM’s team was characterised by longevity of tenure and stability — a sharp contrast to the high turnover in personnel suffered in recent years by Cambridge University Endowment Fund and Harvard University endowment.

Alongside half its small investment staff, OEUM has also lost people in back-office roles. Twelve employees have resigned over the past 18 months out of a workforce of 25 people, according to people familiar with the matter.

Tomsett said he left after “almost seven happy years at the firm” and Edmondson said that it “has been an incredible privilege to help grow OUEM and the endowment over this time”.

Other former employees declined to comment or did not respond to requests for comment.

The exits, particularly that of Edmondson, will increase pressure on the endowment to strengthen its investment expertise and fortify a portfolio that is heavily exposed to private equity.

Rising interest rates and slowing economic growth are already hitting valuations in private markets as well as public ones. At the end of 2021, nearly 38 per cent of OUEM’s assets were invested in private equity, with a further 40 per cent in public equities. The remainder is split across credit, property, short-term bonds and cash.

A portfolio manager who has worked with both Robertson and Edmondson said the latter was widely seen as the “brains” behind the endowment’s investment decisions. “If I was an investor, I would be very worried. I think they’re going to have a tough time. Jack is the biggest loss,” he said.

One investor in the endowment said they had preferred dealing with Edmondson and that the departures were unsettling. “Jack was very good . . . it is a shame he has gone,” he said. “We are happy investors, but we are concerned.”

A former employee added that Edmondson’s and Harling’s departures were “a very big deal” because they were “two very key individuals”. The pair plan to launch their own business focused on managing private assets for a small number of wealthy clients, according to people familiar with the matter.

Balliol College
The exits add pressure on the endowment to strengthen its investment expertise and fortify a portfolio that is heavily exposed to private equity © Planet One Images/Universal Images Group/Getty Images

The remaining investment staff at the fund include Neamul Mohsin, who has been promoted to deputy chief investment officer; Will Lawrie, head of property management; and Chloe Taysom, who has been elevated to head of portfolio management

Before joining OUEM, Robertson held senior roles at the Wellcome Trust, the UK’s largest endowment, latterly as co-head of portfolio management.

One insider said her investment style was “very institutional . . . It takes a very strong leader to have the courage to let your juniors take real risk. I’m not sure there’s enough of that.”

Sir Paul Ruddock, chair of OUEM’s board and a former co-founder of hedge fund Lansdowne Partners, said Robertson brought valuable experience investing across market cycles and that as chief executive she “built a very strong team, respected by peers, investors and other members of the investment industry”.

“Like other endowments globally, OUEM is proud to be an engine room of talent for other institutions,” he added.

Despite fears over the upheaval in senior investment personnel, current and former insiders, as well as investors, stressed that Robertson had presided over a period of excellent performance. According to its latest published figures, OEUM delivered 8.7 per cent annualised real returns over the five years to the end of 2020. That compares with the fund’s stated target of 5 per cent.

James Lawrie, treasurer for Christ Church college, said his institution “is very pleased with their performance and they have done exactly what they promised at inception”.

Another person close to the fund described Robertson as an “excellent investor” who is “thoughtful, curious, [and] likes to challenge the status quo”.

The same insider described Robertson as “100 per cent marmite” — meaning she divided opinion — but “very confident, very solid”.

However, they also raised concerns about how the endowment will fare with key individuals having left and the bull run in markets over. “These are very testing times. A lot of the outperformance has come from private [markets]. The music hasn’t even properly stopped yet . . . We don’t know where that ends,” the person said.

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