Friday, May 21, 2010

More on the Troubling Conflicts of the Board of Trustees

From the Tellus Institution's report (p. 33), more accounts of serious conflicts of interest among the trustees, just in the last 5 years. Listed below are the trustees, their firms, and the funds in which the College invested its endowment money:

P. Andrews McLane, T.A. Associates, T.A. Associates Fund XI - undisclosed sum
R. Bradford Evans, Morgan Stanley, Real Estate Fund VI International TE, L.P. - undisclosed
R. Bradford Evans, Morgan Stanley, Global Best Ideas Fund, L.P. - undisclosed
Russell Carson, Welsh Carson Anderson and Stowe, WCAS L.P. - $20 million
Russell Carson, Welsh Carson Anderson and Stowe, WCAS IV, L.P. - $10 million
Russell Carson, Welsh Carson Anderson and Stowe, WCAS X, L.P. - $15 million
Jonathan Newcomb, Leeds Weld & Co., Leeds Weld IV - $10 million

Information from the New Hampshire Department of Justice, previously obtained by The Dartmouth Review, indicates that Brad Evans' Morgan Stanley received at least $65 million in Dartmouth investments: $20 million for its Real Estate Fund V International in March 2005, and $45 million for its Global Best Ideas Fund in November 2006.

All told, Dartmouth put $110 million of endowment money into funds managed by the trustees.

The report notes very appropriately, "When such a concentration of trustees is involved in managing endowment assets, conflict-of-interest policies of disclosure and recusal from decisions related to one's own firm may provide inadequate assurances of independent oversight."



Anonymous said...

The SEIU connection made me question the study I've been hearing about elsewhere, but if the Review has independent sources saying similar things about conflicts of interest, well...where there's smoke...

Anonymous said...

What are the chances that any high-powered board has no one in finance, and that any finance people aren't connected to some funds that are widely seen as good to invest in? All boards have conflict policies for these reasons, and they allow the boards to invest in funds that are known to be related to members. To do otherwise, either by avoiding certain funds or kicking off certain members, would be contrary to the board's obligations.

Anonymous said...

Unseemly, at the very least.

Anonymous said...

Brad Evans was co-chairman of M&A at MS, where he is now a Senior Advisor. Just because he works for Morgan Stanley does not make him a "fund manager." Especially when making insinuations of impropriety, accuracy in reporting is essential.

Finance Guy said...

Agreed with Anonymous @12:19. Morgan Stanley is a huge organization, with thousands of Managing Directors. If Evans works in M&A, he has as much connection to their real estate direct-investment funds as you or I do. To suggest impropriety on this count is kind of a reach.

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