University of Texas Investment Management Co., which oversees $23.7 billion for the University of Texas System, Austin, will likely ease ethics restrictions that currently prevent board members from making the same investments as those made by UTIMCO, said CEO and CIO Bruce Zimmerman.
There is general support for this on both the UTIMCO board and the University of Texas System Board of Regents, Mr. Zimmerman said. A vote to make the change is expected in July.
Mr. Zimmerman said in an interview that he thought the policy was overreaching when he joined UTIMCO last summer. A survey of 14 of the largest endowments in the country and other Texas trust funds found just one with a similar restriction on board member investments. It was almost unheard of, he said. The rule would keep a board member from passing on a possible private investment if he or she wanted to make the investment personally.
If amended, the rule would require board members to disclose any investments they and UTIMCO both have and to recuse themselves from the board when deciding on any such investments. Also, it would forbid board members from getting any special treatment, such as fee waivers, from firms with which UTIMCO invests. The change would not affect rules forbidding investments by UTIMCO in firms controlled by board members or forbidding staff members from putting personal money in UTIMCO investments.