Bonus Culture in Asset Management “Out of Control”

The chief executives of the world’s largest asset management companies received bonuses that were on average 15 times larger than their salaries last year, raising concerns about inappropriate pay structures in the fund market. According to FTfm analysis of executive pay at the 20 largest listed fund companies in Europe and the US, Larry Fink, the chief executive of BlackRock, and T Rowe Price’s James Kennedy had the highest level of variable pay compared with their salaries last year. Mr Fink’s variable pay — which is mostly made up of bonuses and share awards — was almost 30 times his salary, while Mr Kennedy’s was 24 times his basic pay. The ratios are far higher in asset management than in investment banking, where the chief executives of the five largest US lenders received variable pay that was on average 10 times larger than their salaries last year.