New York / Nov 10, 2011 – Total compensation for risk professionals in asset management grew for a second consecutive year, putting compensation back on the growth trajectory typical of the time period before the credit crisis and recession. Based on data gathered in 2011, total compensation grew 7.2%, salaries grew by 2.4% and bonuses grew 10.8% between 2009 and 2010. These figures were reported in the seventh annual Professional Compensation Survey by Risk Talent Associates, a leading risk management executive search firm.
The alternative investment segment continues to exhibit the strongest gains with 11% growth as compared to 8% for traditional asset management and 3% for insurance/reinsurance. However, the gap narrowed between these three segments when analyzing the impact of the bonus on total compensation. Last year in alternative investments, the average bonus as a percentage of total compensation exceeded 70%, compared to 55% for traditional asset management and 45% of insurance executives included in the survey. However, this year bonus as a percentage of total compensation was aligned across all three segments: 62% for alternative investments, 60% for traditional asset management and 56% for insurance/reinsurance.
Michael Woodrow, President of Risk Talent Associates, notes, “the strongest hedge funds understand that integrated risk management matters and they are continuing to build capable resources. On the traditional asset management side, we are noticing these management firms spending more time and effort to build stronger risk analytics into the investment process. This demonstrates to clients that they are adding value and reinforces trust in their brand. One other trend is that many hedge funds are compensating employees more like mature asset managers, and the compensation differences between risk professionals at traditional asset managers and alternative asset managers has narrowed.”
This year’s survey confirms that total compensation and salary growth is highest for those at two extremes of the experience spectrum: those with entry-level positions and the most senior level positions (Managing Directors and Chief Risk Officers). Over 115 risk professionals participated in this year’s risk salary survey, including executives from traditional asset management (58%), alternative investments including hedge funds and fund of funds (13%) and insurance (29%). Risk Talent Associates, an executive search firm focused on risk management, will publish additional survey updates in 2011 (software, consulting, energy and corporate). All surveys analyze compensation trends by years of experience and title, industry segment, risk focus, geography and size of company.
About Risk Talent Associates
Risk Talent Associates (www.risktalent.com) is the leading international executive search firm focused exclusively on positions in the fields of market, credit and operational risk, as well as financial compliance and risk technology. Risk Talent’s expertise, industry knowledge, proprietary network and dedicated focus shorten the recruiting process to deliver senior and mid-level risk managers in the capital markets, asset management, energy, consulting and software industries. Risk Talent has offices in New York, Chicago, Hong Kong and London.
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