"The proof is in the pudding, and there hasn'tbeen a vast surface of pudding," he said. "That'sgoing to be the ultimate determinant."

Salary Differences Discussed

In addition to investment performance, Fox saidthat council members discussed with Meyer salarydifferences between HMC officials and Harvardprofessors.

In fiscal 1991, the last year for which HMC hasfiled its tax returns, Meyer earned $575,000.

In the past, several Harvard money managersearned six-figure bonuses that pushed their totalcompensation over $1 million.

According to the most recent figures, a fullprofessor at Harvard earns an average of $92,200.

"Mr. Meyer gave us a detailed and fascinatingexplanation of the system of salary determinantsthat is used for investment managers," Skocpolsaid.

"I suggested at the end of the meeting that wemight want to consider a similar system ofreimbursements for Harvard professors."

Fox said several professors wondered whetherHarvard could retain qualified investment managersat lower compensation levels.

"Faculty are willing to work at HarvardUniversity knowing that their skills could getmore if they worked for a pharmaceutical companyor on Wall Street," Fox said. "Aren't there[investment managers]...who are willing to do thistoo?"

In-House System Debated

In addition, Fox said, the faculty membersdiscussed the reasons for maintaining an internalmanagement company at Harvard, instead ofretaining independent management firms.

"[Council members asked] how many otheruniversities do it this way," Fox said.

In the past, President Neil L. Rudenstine hassaid that Harvard is committed to the internalmanagement organization.

But Fox said that some council members areconcerned about the merits of the in-house system.

"The care of the endowment is in the forefrontof [the Faculty's] minds," Fox said.

"This is where the Faculty's patience isshorter than the Corporation's," he added,referring to the seven-member senior governingbody that includes Rudenstine