Glenmede is a planning-intensive firm. Planning helps us manage our business, invest assets and advise our clients. Planning prepares us for growth opportunities and the inevitable challenges that come our way. In 2022 we were able to put our advance planning to good work on both fronts.

Poor markets are part of long-term investing just as hurricanes, tornados and blizzards are part of life in many parts of the country. Since the timing of these events can be uncertain, we look to manage risk by preparing in advance and being particularly guarded when warning signs arise. Our investment strategy team saw the opportunity to invest in the equity market shortly after the pandemic in 2021. They pivoted this past year to become more cautious on the markets. Glenmede Investment Management LP, our internal equity and fixed income management subsidiary, has emphasized higher quality, statistically cheaper securities. This tilt cushioned the market decline and provided performance that exceeded benchmarks.

For the past five years, we have worked to provide our Private Wealth clients with Goals-Based Wealth Reviews. These reviews are intended to give clients a comprehensive yet relatively intuitive means of assessing whether their assets are sufficient to cover their goals. We performed over 500 reviews this past year, the majority of which showed that despite fluctuating markets, clients were still on track to meet their goals.

In this unsettled environment, Glenmede looked for opportunities to grow. We continued to make opportunistic hires in expanding markets and to fortify our fiduciary expertise. This includes Mark Parthemer, Chief Wealth Strategist and new head of our Florida office; Ken Spruill, Director, the Center for Family Philanthropy & Wealth Education, based in Pittsburgh; and Gaby Bailey, Chief Fiduciary Officer in Philadelphia.

Firm Highlights

In 2022 we continued to invest in our technology infrastructure and advance our strategy to consolidate to a limited number of core systems. This allows our employees to focus on providing value-added advice to clients and mitigating risk for the firm. We installed three core systems: a compliance monitoring program, a client presentation creation system and an advisor portal that is built off the same underlying system as our client portal, GlenmedeConnect. All of these systems have automated capabilities that help us to eliminate manual tasks and improve the overall experience for our clients.

Down markets are never easy on the budgets of investment and wealth management firms since revenues are principally tied to asset values. After strong markets in 2020 and 2021, we began 2022 with a carefully targeted budget that assumed we were due at some point for a downturn. Over the course of the year, we managed expenses in a way that allowed us to invest in the business and preserve service and advice levels while carefully adjusting spending where we had some flexibility. Despite a double-digit fall in most asset classes for the year, we were able to generate over $220 million in operating revenue, only 3% lower than the 2021 result. Our balance sheet remains a source of continued strength for the firm and, at year end, contained no debt. While leverage can be an attractive short-term strategy, we prefer to take a longer-term approach that is aligned with the time horizons of our clients and leaves us in a position to be a dependable source of stability for our clients, employees and shareholders during the toughest times.

We had another strong year of new business in our Private Wealth and Endowment & Foundation businesses, adding $8.5 million in new revenues. Much of this new business came from large family relationships. This is an area where we have seen considerable growth over the past several years, as Glenmede has increasingly become a nationally recognized investment and wealth advisor and provider of family office services.

Leadership Transitions

People are our most important resource, and we devote a considerable amount of time and effort to developing our people and preparing for transitions. In 2022 we had an important transition as Stephen Lehman retired as Chief Investment Officer of The Pew Trusts and the broader Endowment & Foundation group. Over the last 20 years, Steve has been both an innovator and a steady hand, diversifying the portfolios and successfully adding value by raising the funds' exposure to alternative assets and other low-correlation strategies. He has been succeeded by Nicholas Warren, who comes to us from Brandeis University where he was Chief Investment Officer for the institution’s endowment.

Early in 2023, Susan Mucciarone transitioned from her role as Executive Director of Private Wealth. We are incredibly grateful for all of Susan’s work to transform the Private Wealth group to a level and stature that has made Glenmede a national leader. She created our Family Wealth practice, championed Goals-Based Investment and Wealth Planning, fostered a next generation of talent and leadership and significantly strengthened our fiduciary practices and capabilities. In summer 2022, Thom Melcher was named as Susan’s successor and has had the benefit of a gradual transition into his new responsibilities. Susan will continue with Glenmede as a Strategic Advisor, working with several relationships that will benefit from her breadth of knowledge and experience.

Finally, last November I announced my plans to retire at the end of August 2023. It has been a tremendous privilege to be part of the Glenmede experience since 2003, when I joined the firm as Chief Investment Officer. It has been amazing and humbling to watch the firm grow during my tenure as CEO as we expanded Family Wealth and Goals-Based Wealth Management and Planning services, established Glenmede Investment Management, formed a dedicated Endowment & Foundation Outsourced Chief Investment Officer effort, assumed a leadership position in the Sustainable and Impact Investing space and opened offices in New York, Palm Beach, Pittsburgh and Washington, DC.

I am pleased to report that the Glenmede Board has appointed Peter Zuleba as my successor. Peter transitioned to the role of President of The Glenmede Trust Company in January 2023 and will become the President of Glenmede Corporation in September 2023. Peter comes to these new roles with extensive experience in investing, private client relationship management, technology and corporate leadership. Most recently, he has been the Director of Investments and President of Glenmede Investment Management. He co-led our inaugural diversity initiative and has been co-chair of the Technology and Operations Committee.

As a result of this experience and preparation, Peter is more than ready to step into his new role. I am both excited for him and for Glenmede as the firm continues to evolve and expand in a manner that is unique and highly valued by our clients.

I am looking forward to making the transition from corporate leadership to “full-time client.” You would probably not be shocked to hear that this has been a very well-planned event. Investments have been structured. Wealth and spending levels have been projected. Estate and charitable documents have been carefully drawn up. And with all that planning comes a certain peace of mind. Indeed, in retirement we might end up shocking our offspring and friends by planning to live life quite spontaneously.

In Memoriam

It is with great sadness that we marked the passing last year of long-time Board member Andy Pew. Andy was a very important part of the character and genesis of Glenmede, a dedicated member of the Board and a true believer in Glenmede as an institution. As long-time chair of the Audit Committee, he approached his job with diligence. He always wanted to know where we might be taking some unforeseen and/or unintended risk and how we might be prepared for difficult situations.

While he liked to manage risk, Andy was not risk averse. As a disciplined risk taker, he was a strong advocate of growth strategies, including the original initiative to take Glenmede beyond managing The Pew Trusts and to expand the asset and wealth management business. He supported our growth initiatives to expand our offices, build out Glenmede Investment Management and develop the Sustainable and Impact Investing capability. He was a steady voice with a long-term perspective on the markets and the business. This was particularly true during difficult markets and earnings cycles where he cautioned against overexuberance during good times and would preach patience and fortitude during downturns. That frequently delivered message will continue to constitute a tremendous competitive advantage for Glenmede.