BOSTON (Reuters) – Vanguard Group Inc raised a profit-sharing dividend for workers by 16.5 % for 2017, the most important improve since 1997, an funding adviser who follows the most important mutual fund firm stated on Friday.
Daniel Wiener, who additionally runs a publication for Vanguard buyers, stated by way of e-mail that payouts made underneath the Pennsylvania firm’s Partnership Plan are based mostly largely on belongings beneath administration, which have risen sharply in recent times.
Vanguard’s well-known passive funds corresponding to its Vanguard 500 Index Fund collectively acquired $329 billion in internet deposits from buyers final yr, in response to researcher Morningstar, the most of any agency within the business and serving to drive the corporate’s complete belongings above $5 trillion.
A Vanguard spokesman, John Woerth, declined to verify the figures obtained by Wiener. Referring to its workforce, Woerth stated by way of e-mail that the Partnership Plan “aligns the interests of the crew with those of Vanguard’s clients.”
Woerth additionally declined to reveal the pay of prime executives together with CEO Tim Buckley, which the closely-held firm doesn’t describe in filings.
Wiener stated partnership dividends account for most of prime executives’ compensation and that one of the simplest ways to estimate the pay of leaders like Buckley is to match it to what the plan would have produced for previous leaders for whom disclosures can be found.
As an illustration, he estimated the newest dividends would have produced payouts of about $24 million and $14 million for 2 previous Vanguard leaders, though they might not obtain the partnership dividends.
For present executives, Wiener wrote, “It may not be hedge-fund money, but for a low-cost indexing shop it ain’t peanuts either.”
Reporting by Ross Kerber; Editing by Frances Kerry