An original backer of a $60-billion-AUM publicly traded asset manager is stepping back.

Michael H. Steinhardt WisdomTree Investments Outgoing Chairman

On Wednesday, WisdomTree Investments [profile] founder and CEO Jono Steinberg confirmed that WisdomTree chairman Michael Steinhardt has retired after 15 years leading the ETF specialist's board of directors. Steinhardt passes the chairman spot to 14-year WisdomTree board member Frank Salerno, who has served on the firm's board for 14 years.

Jonathan Laurence Steinberg WisdomTree Investments, Inc. CEO

Steinhardt's retirement comes after faced public sexual harassment allegations last year and earlier this year, related to his philanthropic work.

Back in 2004, Steinhardt, a famous philanthropist and former hedge fund star, invested in what was then called Index Development Partners (launched by Steinberg in 1985 as Financial Data Systems) and joined its board. Steinhardt's move came in advance of: Index Development Partners' rebranding as WisdomTree in 2005; its relaunch as a fundamental indexing (i.e. "smart beta" or "strategic beta") ETF shop in 2006; and its return to the Nasdaq in 2011.

Though he has divested somewhat over the years, Steinhardt still held 10.8707 million shares of the company as of June 17, 2019. At yesterday's WETF closing price of $4.88 per share, that stake would be worth about $53 million and amount to about seven percent of the $756.9-million company. (Forbes estimates that Steinhardt, now 78, is worth $1.1 billion.)

"Michael's involvement at the birth of WisdomTree was absolutely crucial," Steinberg states. "His presence and belief in the company lent us instant credibility and helped us to attract the necessary capital and talent to compete in the dynamic, fast-growing ETF industry. Michael's ongoing guidance and influential position as Chairman have helped WisdomTree evolve from a research company into the robust and performance-focused ETF sponsor and asset manager we are today."

Steinhardt, for his part, notes that since WisdomTree's "significant strategic repositioning," his investment "has been returned many times over."

"I am proud to have played a role and I look forward to seeing how Frank, Jono and the WisdomTree team take the company to new heights," Steinhardt states.

Salerno, a former Merrill Lynch executive and Bankers Trust Company veteran, joined the board of what is now WisdomTree in 2005. Steinberg describes him as "an invaluable board leader and contributor throughout his tenure" after "a long and storied career in the investment management business." 

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