US family offices lead pay ranks with $1.35 million CIO salaries
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Family offices are loosely regulated entities that mange the investments, tax affairs and philanthropy for the world’s super-rich.
PHOTO: AFP
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LONDON - It pays to be chief investment officer (CIO) at a US family office.
The private investment firms of ultra-wealthy Americans have the greatest number of money managers in that role earning at least US$1 million (S$1.35 million) a year or the same total in other currencies, according to a report from KPMG and recruitment firm Agreus Group.
About 40 per cent of CIOs for US family offices are paid that much annually, while 17 per cent of those in Asia earn more than $1 million and 6 per cent in Europe make at least €1 million (S$1.45 million).
None hit the top rank in Britain, the Middle East or Australia, according to the report, which was released on Tuesday and based on surveys of 625 family office professionals.
By comparison, the total average annual compensation of CIOs at US non-profit endowment funds was US$800,000, according to a 2023 post from the University of Missouri, or roughly three times more than their peers at public pension funds.
On a global level, CIOs with a chartered financial analyst (CFA) charter reported total average pay of US$240,000 a year, a 2019 study by the CFA Institute found.
“In the US, the mindset and culture is they’re prepared to pay for the best,” said Mr Paul Westall, co-founder of London-based Agreus. “Family offices there are more advanced compared with some other countries, and they’ve often already been through the ups and downs of trying to save costs.”
Family offices are loosely regulated entities that mange the investments, tax affairs and philanthropy for the world’s super-rich. They have boomed in number worldwide over the past two decades as billionaires have added trillions of dollars to their combined net worths.
The explosion of wealth has also led to a surge in finance professionals exiting institutional firms to work at family offices.
Ms Dawn Fitzpatrick, a former UBS Group executive, is CIO for Mr George Soros’ namesake investment firm, while former banker Daniel Forman joined Mr Tony James’ Jefferson River Capital in late 2022 in the same role. Ms Erin Riley, who previously worked for Goldman Sachs Group, moved to Mr Bob Shaye’s Lemoko family office in 2022.
About a third of the world’s 500 richest people are in the United States, according to the Bloomberg Billionaires Index.
Roughly 12 per cent of the family offices included in the survey managed more than US$5.1 billion.
New York, California and Texas are the most popular locations for US family offices, which also led globally in awarding employees long-term incentive plans to help retain staff. BLOOMBERG
