A Little Less Conversation, A Little More Compensation

Compensation Structures for Investment Management Firms Whitepaper

Asset Management Margins and Compensation Practice Management

Labor is the single largest expense for any investment management firm, but beyond that simple fact, there is surprisingly little similarity regarding how the thousands of wealth managers, asset managers, independent trust companies, and investment consulting firms pay their people.  Compensation studies show considerable variances in how much firms pay for certain positions, and the character of remuneration — salary, bonuses, equity compensation, benefits — varies as a function of firm history, economics, and culture.

In one regard, this is how it should be.  Compensation structure both reflects and shapes the culture of an investment management firm, and it’s not surprising how little unanimity there is across the profession.  Nevertheless, there is useful information, not simply data, regarding compensation practice.  We have noticed predominant themes in pay practices across our decades of experience working in the space, and we’re called upon to assist clients with compensation issues almost as often as we are called upon to provide valuation services.

As a brief overview of what we’ve witnessed, attached is a whitepaper that we update periodically on the topic of compensation structures for RIAs.  We hope you’ll find it useful.  If you have a compensation conundrum that you’d like to talk with us about, let us know.



Compensation Structures for Investment Management Firms

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