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Taking the helm at Chancellor.

Warren E. Shaw used to spend his evenings browsing through art galleries looking for works by African-American artists to add to his collection. But since his appointment last January, Shaw, 45, has seen few galleries.

The new CEO, chief investment officer and president of Chancellor Capital Management, the New York-based $28 billion money management firm, now spends his days searching for markets that will offer superior returns to his more than 350 institutional clients. His search for African-American art to add to his collection--which includes works by the late Romare Bearden and current artists like Philemona Williamson and Hughie Lee-Smith--has been put somewhat on hold.

Former CEO Robert G. Wade Jr., 67, who will remain at Chancellor as chairman, appointed Shaw as his successor. Wade says, "With Warren at the helm, Chancellor's greatest successes for its clients and employees lie ahead."

It's no wonder. The MIT and Columbia Business School graduate's 22 years at the firm prepared him well for the top job. In 1973, he was a research analyst with Chancellor's predecessor, Citicorp Investment Management. In 1983, he assumed portfolio management responsibilities and, two years later, became investment research chief. The latter promotion was key, as Chancellor relies chiefly on its own research. In 1987, he was appointed equity group head. Those moves put Shaw in a rocket. His negotiation skills and better-than-average stock picking launched it.

First, in 1992, Shaw was a key player in Chancellor's leveraged buyout. Its employees now own 51% of the company, and the insurance firm USF&G owns the rest. Plus, Chancellor's equity stock selection has done fairly well. Although CDA Investment Technologies, a Rockville, Md.-based investment consultant firm, ranked it 279th among 688 stock investing firms in 1994, Chancellor ranked 76th out of 388 during the five-year period ending 1994.

According to R. Barry Thomas, who has known Shaw since 1986 when Thomas was a Union Pacific plan sponsor, Chancellor "will not miss a beat" with Shaw as CEO. Thomas said that Shaw managed approximately $65 million of Union Pacific's money. Currently, Thomas is a managing director at Rogers Casey, a Darien, Conn.-based investment consulting firm that produces PIPER, a pensions and investment performance evaluation report on asset managers. Shaw "has done a great job of bringing together a wide variety of resources to put together a solid product," he says.

After five months as CEO, Shaw doesn't plan any major changes. The 182-employee firm has four main product groups: equity ($11.3 billion), fixed income ($12.3 billion), alternative asset management ($900 billion) and quantitative investment technology ($3.3 billion).

For all its success, Chancellor remains a low-key operation. In a recent interview, Shaw would not reveal the firm's clients, its major holdings or how it did in 1994. Instead, he focused on an overheated stock market that he feels could drop 20% by June. The possible drop has led Chancellor to try "to hedge the portfolios because stocks are expensive, the Fed is tight and investors are bullish."

Shaw's appointment has gained widespread media attention, partly because he is one of several African-Americans who have recently gained top-level positions in corporate America.

Richard Parsons was named a vice president at Time Warner Inc.; Ken Chenault was promoted to vice chairman at American Express; Robert Holland was named CEO of Ben & Jerry's; and Dennis Hightower was tapped to head Disney's television and telecommunications department (see Newspoints, this issue).

Shaw urges other companies to "seek diversity wherever they can" if they wish to see other minorities ascending the corporate ladder.
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Title Annotation:Chancellor Capital Management's Warren E. Shaw
Author:McCoy, Frank
Publication:Black Enterprise
Article Type:Biography
Date:Jun 1, 1995
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