Mendillo admitted that the system was “unusual” but stuck to the promise that “no bonus is earned unless the market benchmark is beaten.”

During calendar year 2009, the top-earner at HMC was Blyth, who received roughly $8.4 million. Mendillo earned $3,498,269.

CRISIS MODE

During the financial downturn, Mendillo and her staff began each day at 7 a.m. with a crisis meeting.

At the time—late 2008 and into 2009—the University’s endowment began to take a turn for the worse as markets plummeted and Harvard’s investments in exotic financial instruments began to backfire. The aggressive investment strategies pushed by Meyer—what inspired the vulture’s placement on a central spot of the trading floor—would turn sour. Now, the company did not need a vulture at the company’s helm but a rescue worker—someone equipped with the jaws of life.

When Mendillo attended her first board meeting in June 2008 as head of the company, the board began to detect the initial signs of catastrophe.

By the second board meeting that September, Lehman Brothers was only days away from its bankruptcy, and its  subsequent demise devastated financial markets.

As the economy imploded, the endowment suffered repeated jolts, fluctuating in value each day by $700 million to nearly $1 billion.

The high volatility intensified transactions and tension on the trading floor and in the company’s hallways as Mendillo quickly unloaded some of Harvard’s private equity holdings in secondary markets, selling at discounted rates as supply overburdened the market and depressed prices.

Private equity—the purchase of a company then restructuring it and trying to sell it at a profit—is an illiquid asset class, as firms can often take five years to implement their reforms.

In her earlier capacity as the head of Wellesley’s investment office, Mendillo had shed Wellesley’s holdings in private equity just months before joining HMC. But those transactions would prove difficult to replicate as financial markets froze and buyers fled from exchanges.

“Literally the first day after I joined, I had a meeting on selling some private equity assets,” said Mendillo.

Though these markdown transactions appeared to be a series of quick-fire sales, in reality it was a calculated strategy to increase immediate liquidity—or the ability to convert investments into cash—and to take advantage of arbitrage opportunities of overpricing of private equity, according to annual reports.

When Mendillo, six months into her post as CEO, stood in front of the HMC board for their first meeting since the low-point of the financial crisis, board members knew much of the news she would report. By the end of the fiscal year, the endowment would plunge sharply, decreasing in value by a stunning 27.3 percent to $26 billion. Though she was about to present the worst returns in Harvard’s history, she remained calm and collected during the quarterly meeting.

“I think Jane has proven to be a terrific leader. She is calm, she is cool, she is rational, she is decisive in a tough spot. She is someone you want with you in the foxhole,” said Glenn Hutchins ’77, a member of HMC’s board and the co-founder of Silver Lake, a private equity firm.