Summers Says ‘Soul Searching’ Needed for Harvard Endowment After Miss

(Bloomberg) -- Former Harvard University President Lawrence Summers said that managers of the school’s endowment must conduct “some soul searching” after returns fell short of peers in the latest fiscal year. 

Harvard’s “performance has lagged for a substantial time period,” Summers told Bloomberg Television’s “Wall Street Week” with David Westin. “The people who are currently responsible for that do need to do some soul searching on why that’s taken place and try to set it right since it’s cost the university billions of dollars.”

The richest U.S college’s endowment returned 34% in the 12 months through June, it said Thursday. That trails almost all the major universities that have reported results -- many of which credited stock holdings and venture capital investments for their success. Harvard attributed its results to taking less risk.
  
Harvard’s endowment still added $11 billion over the period, and the fund’s value hit a record $53 billion. Only about a dozen U.S. colleges had endowment values of $11 billion or more in the last fiscal year.

Summers is now president emeritus of Harvard, having run it from 2001 to 2006. He is also a paid contributor to Bloomberg.

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