Market insights and salary survey

Market insights and salary survey

Mason Blake This document has been prepared by Mason Blake. The information contained in this document is a brief insight into the investment management employment market in 2013. For further information please contact: Rachael Hewson Managing Director P 0207 033 4499 E rachael.hewson@masonblake.com 2 / Mason Blake - Salary Survey 2013

Financial Search & Selection Market insights Mason Blake is a specialist investment management recruitment consultancy. We have experienced consultants who cover distribution, investment and operational functions. Our focus has allowed us to become experts in the sector and build an unrivalled network of clients and candidates. It also gives us unique insight to identify opportunities for our clients. This report has been prepared by our team and helps identify remuneration and compensation trends and benchmarks, issues impacting award strategies and sectors that might experience growth in 2014. General market Question & Answers Are there any areas where compensation has moved significantly, base, bonus or both? Base salaries across all divisions have increased slightly in the last twelve months. Investment risk, compliance, RFP and fixed income performance has seen the biggest rises in base and bonuses. This is also true of mid-level professionals on the market (2-5 years experience). Candidates with 2-3 years in these areas are looking at salaries of 45, 000-50, 000. Investment risk roles or quantitative based roles can offer around 50% bonus, which is higher at smaller firms. There is more of an appetite for highly paid interim contractors and consultants to fill skills gaps and work on projects. Graduate entry roles are back to 2007 salaries. Offers are around 30, 000-35, 000 from 25,000 in 2011/2012. Finance has remained steady with a bias towards the base salary, and bonus is rarely above 20%. There has been a change with bonus expectations. Candidates are showing an increased confidence that bonuses will be back this year. The same confidence, however, was in place last year but proved to be misplaced for many. Are there any themes or evidence that suggests a shift in the mix of fixed and variable compensation? There has been no suggestion that Investment Management firms are moving to a more variable based compensation in the analyst to director level market. Candidates with salaries over 100, 000 tend to have part of their bonus in deferred shares, but this is usually on top of a good bonus, for example: 50% cash plus deferred shares, rather than instead of. Candidates from small boutiques and the sell side have seen more dramatic changes in this area with the majority being deferred. What has the recruitment market been like over the past 12 months, and who has been recruiting? What business areas have been recruiting in these firms? Multi-asset and Fixed Income specialists have been in higher demand in 2013 and the market across all divisions has remained relatively buoyant in the last twelve months. Recruitment within the front office has started to come back, but clients have been unambitious across asset classes with the majority of hires coming from replacement scenarios. We feel that fund managers at larger companies are a little unsure of how markets will turn out and what fund areas their focus will be on over the coming years. However, we have already seen an upturn in Real Estate and hope that given the strengthening FTSE and other equity markets we will see an increase in this area. Mason Blake - Salary Survey 2013 / 3

Mason Blake Investment support roles have been more frequent, such as fixed income FMA positions from companies like Fidelity and Wellington Management International. We have also seen equity focused investment support type positions arising in Q1 and Q2 from smaller houses like JO Hambro Capital, Genesis and Talisman. Areas like Performance have been very busy, with M&G, Wellington, Aviva and Fidelity all hiring in this area. It has been predominantly replacement hires. Firms are under increasing pressure from clients and shareholders to increase risk management functions. Compliance recruitment has increased dramatically as most funds now accept that investment in this space is a necessity. We have also seen an increase in individuals with no compliance experience looking to move into the space, mostly from operations and front office. Most firms are reluctant to cross train, so there has been a tendency to hire graduate calibre individuals to fill these gaps. We have been extremely active recruiting in the distribution space. A number of US houses who have previously focused on the institutional market are expanding into the wholesale/ third party distribution channels in the UK and Europe. Asset class focus has been fixed income, with teams keen to build out their LDI area in particular. European expansion has been a trend for our clients, in particular roles focused on Holland, Germany and Scandinavia. Constant areas of recruitment include marketing on all levels as well as product development, client services and investment writing. Firms we have been busy recruiting for are: Investec Asset Management, Aberdeen Asset Management and Wellington Management International. Contract and temporary recruitment has been busy in investment writing, RFPs, fixed income performance, investment reporting, project management (product and operations) particularly with M&G and LGIM. This is due to internal restructures, streamlining processes and expansion/good performance. There has been an increase of candidates with alternative and hedge fund backgrounds, as they are working in a more volatile market. It is still quite common to see good candidates made redundant due to mass redemptions or poor performance at a Hedge fund. How have other firms managed guarantees and conditional awards? These challenges are often overcome by offering candidates roles with increased responsibility and base salary. This allows candidates to focus on the longer term development and bonus. Clients are reluctant to specify bonuses before the offer stage. Most clients are expecting to offer guarantees or build some alternative into an offer at this stage of the year (October onwards). The ways this has been dealt with over the last month: Client A: Gave a guaranteed bonus worked out by the average of the candidates last 3 year bonuses. In this scenario the guarantee was 22, 000. The candidates current base was 80,000 and they increased it to 90,000. This secured the candidate from a competitor. The candidate is in a front office operations function. Client B: Did not give a guaranteed bonus but a 25% uplift in base salary to compensate. The candidate had a base salary of below 50, 000. We feel this is only well received with candidates on lower salaries. Client C: Could not offer a guarantee, but agreed to add them into the 2012 bonus pool and verbally communicated a target bonus that matched their 2011/2012 bonus plus a 12% salary increase. The candidate is to start in November 2013 and was an RFP manager moving into a product specialist role. 4 / Mason Blake - Salary Survey 2013

Financial Search & Selection Clients are recognising that top talent requires a more proactive approach, and are moving quickly through the process and matching reasonable expectations. Clients are also going further after the offer stage, and taking candidates for drinks or coffees with their new teams. We fully encourage this for top talent. Investec and Wellington have been very forward in this, and have often fought off competition with a proactive approach, alongside a history of good bonuses and base salaries. What are your views on the outlook for the market in 2014? Mason Blake has had a significant increase in job volumes in 2013 compared to previous years, and the indicators from our clients are that 2014 is going to be a more active year again. The majority of our clients expect to be recruiting, however, the pressure for them is to get more productivity from existing employees and new hires are carefully considered. Agencies and clients will need to be mindful in 2014 that good candidates will generally have a number of opportunities running concurrently, and it will be imperative that the process is managed correctly. At offer stage there has been an increasing trend of buy-backs and promise of other roles internally to keep employees from leaving. We expect that given the development in the equity market we will see an increase for investment support areas such as risk, performance and quants. We believe Fixed Income will remain steady whilst uncertainties in stock markets remain, particularly in areas like credit and rates where we have seen roles throughout 2013. We have received mixed feedback from our clients regarding the outlook for distribution next year. This area has been so consistently busy for Mason Blake for the last 3 years, that some of our clients envisage it slowing down and more operational recruitment taking place to support new inflows etc. However others look set to keep on increasing their sales and marketing teams. Are there any areas where you think there will be a particular uptick in demand in 2014? Clients that fill their roles quickly look to hire talent over the perfect fit, and think laterally. We support this, as our focus is on sourcing quality candidates over volume and it is encouraging that more clients are thinking this way. Mason Blake hires placed on this basis tend to stay longer and make more of an impact in our clients business. We expect any roles involving process improvements around controls and monitoring to remain very active. There will also be a focus on systems roles and projects, as firms look at improving their reporting and transparency to their regulators and shareholders. We have already seen a greater volume of data analyst positions, project management roles and third party relationship managers. We anticipate research and product roles to be frequent, particularly in equity and real estate. As our clients focus on exceptional client service and ensuring that their investors receive up to date/relevant and insightful information; the increase in investment writing and client service roles will remain. The most in demand level of finance professionals remains newly qualified up to two to three years post qualified. Mason Blake - Salary Survey 2013 / 5

Mason Blake Distribution Consultant Relations 25,000-50,000 10-20 % 50,000-65,000 CRM 25,000-40,000 10% 40,000-65,000 Investment Writing 25,000-40,000 40,000-65,000 Marketing - Institutional 25,000-45,000 10-20 % 40,000-65,000 Marketing - Retail 25,000-40,000 5-8 % 40,000-55,000 Marketing - Wholesale 25,000-40,000 10% 40,000-60,000 Product Development 30,000-45,000 45,000-60,000 Product Specialist (Equities) 30,000-45,000 20% 45,000-65,000 Product Specialist (FI) 30,000-45,000 20% 45,000-65,000 RFP 25,000-50,000 10-20 % 50,000-70,000 Investments Credit Analyst 30,000-45,000 15-20 % 45,000-70,000 Economist 30,000-40,000 * 40,000-70,000 Equity Analyst 35,000-50,000 20-50 % 50,000-100,000 Investment Analyst (FOF) 30,000-45,000 3-10 % 45,000-80,000 Performance 30,000-45,000 5-15 % 35,000-70,000 6 / Mason Blake - Salary Survey 2013

Financial Search & Selection 25-35 % 65,000-90,000 35-40% 90,000-120,000 50-120 % 15-45 % 65,000-90,000 15-45% 90,000-120,000 30-80 % 15-40 % 65,000-90,000 15-40% 90,000-125,000 30-50 % 20-35 % 65,000-85,000 35-50% 85,000-120,000 40-100% 10-30 % 55,000-70,000 20-40% 70,000-100,000 35-80 % 15-35 % 60,000-70,000 30-50% 70,000-110,000 50-100 % 15-40 % 60,000-80,000 20-60% 80,000-120,000 40-100 % 20-30 % 65,000-75,000 20-50% 75,000-120,000 45-100 % 20-25 % 65,000-75,000 20-50% 75,000-120,000 30-120 % 20-25 % 70,000-90,000 25-40% 90,000-110,000 30-50 % 20-45% 65,000-100,000 20-45 % 120,000 + * * 40,000-70,000 * 120,000 + * 30-80% 70,000-100,000 30-80 % 120,000 + * 15-20% 70,000-100,000 15-20 % 100,000 + * 15-20% 55,000-70,000 15-20 % 90,000 + 30-50 % For any recruitment services we can offer to you as a candidate or client, please do feel free to contact one of our consultants on 0207 033 4499 or info@masonblake.com Mason Blake - Salary Survey 2013 / 7

Mason Blake Finance Financial Control (Qualified) 45,000-60,000 60,000-80,000 Finance Manager (Qualified) 42,000-55,000 55,000-75,000 Management Accountant (Qualified) 42,000-55,000 50,000-60,000 Management Accountamnt (Part Qualified) 25,000-35,000 30,000-40,000 Financial Accountant (Qualified) 42,000-55,000 50,000-60,000 Financial Accountant (Part Qualified) 25,000-35,000 30,000-40,000 Fund Accountant (Qualified) 45,000-55,000 45,000-60,000 Newly Qualified Accountant 42,000-50,000 Risk Operational Risk 30,000-45,000 40,000-55,000 Investment Risk 40,000-55,000 50,000-65,000 Compliance Generalist 25,000-35,000 10-15% 35,000-50,000 Investment Compliance 30,000-40,000 10-15% 40,000-55,000 Monitoring 25,000-35,000 10-15% 35,000-50,000 Advisory 25,000-35,000 10-15% 35,000-50,000 8 / Mason Blake - Salary Survey 2013

Financial Search & Selection 80,000-110,000 20-40% 80,000-100,000 20-40% 60,000-80,000 20-30% 60,000-80,000 10-30% 50,000-65,000 65,000-80,000 10-15% 55,000+ 10-15% 75,000-100,000 20-30% 10-25% 65,000+ 10-30% 80,000-110,000+ 20-40% 50,000+ 15-20% 120,000+ 55,000-80,000 15-20% 55,000-80,000 15-20% 90,000+ 15-20% 100,000+ For any recruitment services we can offer to you as a candidate or client, please do feel free to contact one of our consultants on 0207 033 4499 or info@masonblake.com Mason Blake - Salary Survey 2013 / 9

Mason Blake Operations Trade Support 25,000-40,000 10% - 25% 40,000-55,000 Reconciliations 25,000-35,000 10% - 20% 30,000-45,000 Data 25,000-35,000 10% - 20% 30,000-55,000 Corporate Actions 25,000-35,000 10% - 20% 30,000-55,000 Client Services 25,000-35,000 10% - 20% 35,000-60,000 Business Analyst 30,000-40,000 10% - 25% 40,000-55,000 Project Manager 45,000-70,000 3rd Party RM 40,000-60,000 Operations Analyst 25,000-40,000 10% - 25% 40,000-55,000 Operations Manager COO Temporary and Contract Client Reporting 15-17 per hour 20-25 per hour Client Services 12-18 per hour 18-24 per hour Fund Accounting 17-20 per hour 20-27 per hour Investment Writing 200-250 per day 300-350 per day Marketing 150 per day 200-300 per day Operations 12-18 per hour 18-25 per hour Oversight 200 + per day Performance 16-18 per hour 250-350 per day Product Development 350-550 per day RFP 17-20 per hour 25-30 per hour 10 / Mason Blake - Salary Survey 2013

Financial Search & Selection 10% - 25% 50,000-65,000 10% - 25% 10% - 20% 45,000-55,000 10% - 20% 10% - 20% 50,000-75,000 10% - 20% 70,000-90,000 20%+ 10% - 20% 50,000-60,000 10% - 20% 15% - 25% 60,000-75,000 15% - 25% 75,000-120,000 25% 10% - 25% 20%+ 70,000-100,000 20%+ 100,000+ 25%+ 10% - 20% 60,000-80,000 10% - 20% 80,000-100,000 20% 10% - 25% 65,000-100,000 20%+ 80,000-120,000 20%+ 90,000+ 30%+ 30 per hour 250-300 per day 25-30 per hour 400-450 per day 400 per day 250-350 per day 300 per day 350-450 per day 600-750 per day For any recruitment services we can offer to you as a candidate or client, please do feel free to contact one of our consultants on 30-35 per hour 0207 033 4499 or info@masonblake.com Mason Blake - Salary Survey 2013 / 11

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