The former chief investment officer of Wellesley College, Jane Mendillo, has been selected as chief executive of Harvard Management Company, the company that manages Harvard University’s $35-billion endowment, reports The Wall Street Journal.

Ms. Mendillo oversaw an average annualized return of 13.5 percent in Wellesley’s endowment during the past five years, compared with a return of 12.3 percent for all endowments, with $1-billion or more in assets over that period. During those same years, Harvard achieved an average annualized return of 18.4 percent.

Observers say that Ms. Mendillo’s endowment-management experience, as well as her previous 15 years of work experience in Harvard Management in various positions, made her an ideal candidate to lead the staff of 175. She takes over for Mohamed El-Erian, who left the post in September to return to Allianz SE’s Pacific Investment Management Company after less than two years at Harvard.

“It sounds like Harvard came to the conclusion that they need to move to a more traditional endowment manager,” says Allen Proctor, consultant to endowments and a former Harvard chief financial officer. “The board wanted someone who sees being an effective communicator with the university constituencies as an important part of the job.”

Although Ms. Mendillo expressed enthusiasm about the job, calling it “the pinnacle of the profession,” critics of the size of recent pay packages to many of the endowment’s top money managers — as high as $35-million — will be watching closely, the newspaper said.

Ms. Mendillo’s compensation package will be tied to performance.

See The Chronicle’s most-recent survey of nonprofit endowments.

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