Prudential is set to introduce a cap on fund manager salaries after fixed income star Richard Woolnough took home £32 million in 24 months.
A report by Sky News details the insurance behemoth’s plans to impose a ceiling on the remuneration of top fund managers at its asset management subsidiary M&G Investments.
It is believed that Prudential has decided to implement the cap after Woolnough, manager of M&G’s Optimal Income, Corporate Bond and Strategic Corporate Bond vehicles, was paid £32 million between 2013 and 2014.
While both Prudential and M&G declined to comment, it is understood that details of the cap are yet to be finalised and that the terms will only affect new employees.
It is reported that there had been some 'embarrassment' at Prudential regarding the huge bonuses paid to Woolnough in 2013 and 2014, although this does not necessarily indicate that his performance had not justified them.
Prudential has been the subject of media scrutiny over the past few years regarding the amount paid to high-ranking employees, with Woolnough’s bumper package of £17.5 million for 2013 outstripping even that of then-group chief executive Tidjane Thiam, who took home £8.7 million in the same period.
The reports come in the wake of M&G’s 2015 annual results, published 9 March, which detailed a 1% year-on-year slide in operating profit to £442 million.
Woolnough, who manages just under £35 billion across four strategies, saw outflows of £864 million from Optimal Income alone in January as market volatility put pressure on investment funds across the board.