Thomas J. Hollister Appointed Harvard’s CFO
Thomas J. Hollister, a former banking executive, has been appointed chief financial officer and vice president for finance, as of the middle of May. He will fill an important vacancy in the University’s senior administrative ranks, created when Dan Shore, who assumed the post in 2008, departed last September to join a young technology company.
The vice president and CFO has historically directed University-wide budgeting, financial planning and reporting, debt and cash management, risk management, auditing, sponsored-research administration, and financial systems. He reports to executive vice president Katie Lapp, who announced the appointment. “We will benefit from his wealth of experience spanning all areas of finance—from capital markets, to banking and real estate,” Lapp said of Hollister in the news release. “He is smart, strategic, and has likely faced every conceivable financial challenge.”
Hollister began his banking career in 1979 at Bank of Boston, where he engaged in commercial banking and commercial real estate before becoming executive vice president of consumer and small-business banking. In 1998, he was named president of Citizens Bank of Massachusetts. He moved from operating to strategic roles, as vice chairman of Citizens Financial Group, where he led the merger with Charter One Bank, based in Chicago (one of many bank mergers and consolidations he oversaw), and then returned to Boston as chief operating officer and CFO of Global Partners LP, an energy distributor; he retired from that position in June 2013. He has chaired the boards of nonprofit organizations (Tufts Medical Center and Wheaton College—both useful background for a university CFO), and serves on the executive committee of the Greater Boston Chamber of Commerce (which he also chaired, and where he is identified as managing director of Wesquo Capital Partners LLP, a private real estate investment-management firm based in Nantucket). With experience in real estate, banking, and the Boston business community, he may, as Harvard's financial vice president, have valuable perspectives to offer on the University's expansion in Allston, also overseen by Lapp. According to his Bloomberg profile, Hollister graduated from Amherst College and earned his M.B.A. from Boston University.
Shore became CFO just as the financial crisis and ensuing recession caused a stomach-churning, $11-billion decline in the value of the Harvard endowment. Beyond the demands of managing the severe, short-term strains on the University’s finances, he and other senior officers tackled longer-range issues. In concert with the reformed Harvard Corporation, they created a process for managing major facilities and capital investments; adopted multiyear budgets linked to endowment distributions that are “smoothed” to buffer the effects of volatile investment returns; and much more closely linked the University’s needs for cash to Harvard Management Company’s investment strategies for the endowment.
Hollister faces different challenges—in the happier environment of an endowment that had, as of last June 30, nearly regained its nominal pre-crisis value, and a capital campaign that has secured gifts and pledges of $5 billion as of the end of 2014. The issues today revolve around changes in research universities’ financial model, as federal support for sponsored research is more tightly constrained, and in family circumstances and the student population that may limit increases in tuition (now more than $60,000 annually for undergraduates, with increases currently running about 3.5 percent annually) while requiring more financial aid. (The Harvard Campaign’s ambitious goals for financial-aid endowment funds aim to address at least part of the latter pressure.)
The filling of the CFO vacancy follows President Drew Faust’s recent announcement of the promotion of Paul Andrew to the vice presidency of public affairs and communications. Important remaining appointments include the new deans of:
- the Harvard Kennedy School (David T. Ellwood departs at the end of this academic year);
- the School of Engineering and Applied Sciences (Cherry A. Murray stepped down as of last December, and Harry R. Lewis is interim dean); and
- the Harvard T.H. Chan School of Public Health, following the April 13 announcement that Julio Frenk would become president of the University of Miami this coming September (an interim dean is expected to be appointed).