BlackRock CEO Larry Fink's 2018 pay cut to $24 million
and Anders MelinBloomberg
BlackRock Inc. cut chief executive officer Larry Fink’s compensation by about 14 per cent to $24 million (U.S.) for 2018 after the company faced institutional outflows and saw its share price drop.
The world’s largest asset manager gave Fink a $7.8-million cash bonus, the company reported Friday in a regulatory filing. He earned a $1.5-million salary and $14.8 million in equity awards.
BlackRock faced a difficult year in 2018. The share price fell 24 per cent and institutions pulled money from its investment products for three straight quarters. The firm began 2019 with some major changes. It announced plans to cut 500 jobs, or 3 per cent of its global workforce. Several executives got new roles in a management shuffle earlier this month.
In the filing released today, the firm’s compensation committee detailed the rationale for reducing Fink’s pay.
“In 2018, BlackRock expanded operating margin, executed on key strategic initiatives, made significant progress toward inclusion and diversity objectives, and outperformed” certain peers, the report said. “Nonetheless, due to BlackRock’s financial performance relative to expectations and underperformance in alpha-generating products, the compensation committee’s assessment resulted in a Partially Meets determination.”
Fink, 66, acknowledged the turmoil his industry faced in the past year in a separate annual letter to shareholders.
“2018 was a difficult year for the asset management industry and a marker of things to come: greater focus on value, tougher competition, more operating complexity and disruption of legacy business models,” he wrote. “Many asset managers have not adequately prepared for these changes.”
BlackRock shares rose 14 per cent this year through April 11.