2010 Annual Report - Harbert Management Corporation

These principles have also driven the development of our business model.
HMC focuses solely on the alternative investment landscape through
both private market and hedge fund vehicles. Within that universe we
invest primarily in equity or equity-like securities as these assets have
the potential to achieve our yield objectives without relying on leverage
to gear up low return assets. Our risk management is focused on the
permanent impairment of capital rather than measures of short-term
volatility. Consequently, we manage our downside exposure with asset
by asset investment analysis, diversification, and lower leverage; rather
than statistical models, the perceived safety of liquidity, or doing “big high
quality deals” most of which have been priced to perfection.
Our efforts to improve HMC’s communication with investors have also
resulted in several organizational changes. We have asked Charlie Miller
to focus exclusively on repositioning the firm from a marketing and
investor relations perspective. He has become Executive Vice President
and Global Head of Distribution. This will permit Charlie to focus solely
on the management of our investor relations team. We have added two
senior marketing professionals to that group: Rich Brereton whose primary
focus will be on hedge funds working out of HMC’s New York office, and
Ken Freeman who will cover the U.S. West Coast and Asia Pacific investors
out of our San Francisco office. Several additional research and support
personnel have also been added to support the more intensive efforts.
Beyond these personnel changes we plan to significantly enhance the
quality and quantity of communications with our limited partners.
In addition to our annual investor conference, you should expect more
regular conference calls, meetings, and written reports from the
investment management teams updating clients on fund performance and
market conditions. We also expect Harbert Management Corporation’s
investment professionals to be more involved and to make a great
contribution to public discourse and general investor knowledge in their
areas of investment expertise, which will make HMC more of a problemsolving,
solution-based resource for our clients.
During 2010 we have also implemented important changes to our website
and investor reporting. Investors are able to access an ever increasing
volume of information about the funds they participate in online through
the Investor Center embedded in the HMC website. During 2010 we have
also changed our outside administrator to HedgeServ and are working
towards the goal of providing statements that will consolidate all of an
investor’s investments across all HMC funds, which eventually will also
be available online through our website.
Harbert Management Corporation
expect more regular
conference calls, meetings,
and written reports
from the investment
management teams
updating clients on fund
performance and market
conditions.
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