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The CEO of Utimco, the $68bn University of Texas and Texas A&M endowment system, believes that older executives should retire to make way for the next generation. Britt Harris, who is 65 and stepping down from his role at the end of the month, stated that not retiring can prevent younger individuals from attaining senior positions until much later in life. During his tenure, Harris played a significant role in growing the endowment’s assets by almost 65% within six years, outperforming 98% of other endowments. In contrast, many executives on Wall Street are choosing to delay retirement, with some receiving incentives to remain in their positions.
Contrary to this trend, older executives like Bank of America CEO Brian Moynihan, BlackRock founder Larry Fink, and Berkshire Hathaway Chairman Warren Buffett have expressed no intentions of retiring. The traditional retirement age was established when physical labor was more prevalent, with the 1935 Social Security Act setting it at 65 in the US. However, with longer lifespans, Americans are now choosing to stay in the workforce for longer to ensure financial security during retirement. The average retirement age in 1998 was 64, but it has been gradually increasing, reaching 67 for those born after 1960 in 2022.
A survey by the Transamerica Center for Retirement Studies revealed that more than half of US workers do not plan to retire before the age of 65, if at all, while many companies still expect employees to retire before that age. Experts suggest that over-reliance on a single CEO can hinder succession planning, as seen in cases where executives return to their former companies. Britt Harris, drawing from his 43 years of experience, believes that while older executives provide stability and institutional knowledge, creating space for younger employees is crucial for investment firms in navigating changing markets and generational dynamics.
