Wealth Manager - the site for professional investment managers

Register to get unlimited access to all of Citywire’s Fund Manager database. Registration is free and only takes a minute.

Investment manager bonuses to be paid in own fund units

Investment manager bonuses to be paid in own fund units

Bonus payouts to asset managers will be made up of at least 50% of shares in their own funds under EU rules passed last night.

The changes outlined in UCITS V rules also stipulate that 40% of a manager's bonus must be deferred for three years, or 60% in the case of very high payouts.

After ratification - expected to take place in the next few weeks - EU members will have 18 months to introduce the legislation into domestic law.

The regulation will not affect private equity or hedge fund managers covered by parallel alternatives rules. 

'Today’s deal will deliver greater protection for investors, as well as taking steps to reduce reckless risk taking in the investment fund sector,' Sven Giegold, a German politician who helped pass the directive, said.

'The revised legislation includes important provisions on remuneration that will ensure the interests of investors are better reconciled with those of fund managers.'

But he added that 'the legislation fails to tackle the problem of performance fees for management companies, which are opaque and a rip-off for investors, unfairly reducing their income from funds.'

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play Volatility spike: How ETFs can soften the blow

Volatility spike: How ETFs can soften the blow

ETFGI’s Deborah Fuhr discusses the role of ETFs in client portfolios during volatile market conditions

Play Winter market warmers, the post QE world and timing the Fed

Winter market warmers, the post QE world and timing the Fed

This week’s episode of Investment Pulse looks at the winding down of quantitative easing, whether to try and time a US Federal Reserve rate rise and if strong seasonal performers can reverse recent market slumps

Play JPM’s Negyal: Back divis to temper EM volatility

JPM’s Negyal: Back divis to temper EM volatility

Omar Negyal, co-manager of the JPMorgan Global Emerging Markets Income trust, says a dividend approach to emerging markets reduces the volatility of investing in the asset class.

Wealth Manager on Twitter