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BlackRock's higher pay spending almost all down to severance

BlackRock might have bopped back up over $10tn in Assets Under Management (AUM) at the end of 2023, but that doesn’t mean it’s paying its people proportionally.

The world’s biggest asset manager increased its compensation expensive by “just” $73m – a 5% increase – between the fourth quarters of 2022 and 2023. It put this increase down to “higher incentive compensation, primarily as a result of higher performance fees, and higher severance."

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However, it also registered a restructuring charge of $61m in the fourth quarter of the year. This was “comprised of severance and compensation expense for accelerated vesting of previously granted deferred compensation awards,” primarily attached to restructuring its Aladdin and alternative investment platforms. That leaves on $12m of the compensation increase due to the aformentioned "higher incentive compensation." 

BlackRock announced 600 job cuts earlier this week. It didn't break out headcount numbers in today's results, but the expectation is that headcount in 2023 remained relatively constant compared to 2022. Even while it cuts however, it has indicated that it plans to continue hiring - where it makes sense to, at least. Chairman & CEO Larry Fink has previously noted that using artifical intelligence “will increase productivity by 30%”.

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AUTHORZeno Toulon
  • Su
    Sulej
    13 January 2024

    Did an illiterate AI write this? 

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