Medial compensation for Canadian investment professionals falls to $116,000, drop in incentive pay to blame: study
A significant drop in bonuses has pulled the average compensation for Canadian investment professionals to its lowest point in five years, according to a recent study.
The 2003 Investment Management Compensation Survey found that the overall 2003 median total compensation for professionals based in Canada is $116,000, a 28 per cent drop from 2001 ($161,000) and a 24 per cent dip from 1999 ($153,000).
While base salaries remained fairly constant, much of the drop in incentive compensation can be attributed to median cash bonuses falling about 56 per cent from $45,000 in 2001 to $20,000 in 2003.
“The drop in Canadian compensation levels is sobering news for the investment management industry,” said Shawn Cooper, executive director and head of the Canadian Financial Services Practice of Russell Reynolds associates, who conducted the study with the Association for Investment Management and Research. “Given the prolonged bear market, compensation was expected to fall but the sharp degree indicated by these survey results may come as a surprise to many people.”
Among countries included in the survey, Canada is ranked second-last behind the U.K., the U.S., Japan, Switzerland and Hong Kong, beating only Singapore.
“When you consider the size, depth and maturity of Canada’s investment management industry relative to some of the other countries studied, Canada’s poor ranking is unexpected,” said Cooper. “Especially given that the Canadian economy has performed better than elsewhere.”
The gender gap
The study found women in the industry are earning about 12 per cent less than their male counterparts in 2003. That means the gender gap has closed somewhat since 2001, when it stood at 16 per cent.
Women with more than 20 years experience actually earn more than men with the same experience while those with less than five years are pretty much on par. But the gap is significant for women with 10 to 20 years under their belt — that group earned 22 per cent less than men, according to the study.
The results of the survey are based on responses from about 16,500 AIMR members (2,183 in Canada) compiled by Withlin Worldwide, an independent market research firm. The survey was conducted in the first quarter of 2003.
The Association for Investment Management and Research (AIMR) is a non-profit membership organization of investment professionals headquartered in Charlottesville, Va.
Russell Reynolds Associates is a New York-based executive recruiting consulting firm.
The 2003 Investment Management Compensation Survey found that the overall 2003 median total compensation for professionals based in Canada is $116,000, a 28 per cent drop from 2001 ($161,000) and a 24 per cent dip from 1999 ($153,000).
While base salaries remained fairly constant, much of the drop in incentive compensation can be attributed to median cash bonuses falling about 56 per cent from $45,000 in 2001 to $20,000 in 2003.
“The drop in Canadian compensation levels is sobering news for the investment management industry,” said Shawn Cooper, executive director and head of the Canadian Financial Services Practice of Russell Reynolds associates, who conducted the study with the Association for Investment Management and Research. “Given the prolonged bear market, compensation was expected to fall but the sharp degree indicated by these survey results may come as a surprise to many people.”
Among countries included in the survey, Canada is ranked second-last behind the U.K., the U.S., Japan, Switzerland and Hong Kong, beating only Singapore.
“When you consider the size, depth and maturity of Canada’s investment management industry relative to some of the other countries studied, Canada’s poor ranking is unexpected,” said Cooper. “Especially given that the Canadian economy has performed better than elsewhere.”
The gender gap
The study found women in the industry are earning about 12 per cent less than their male counterparts in 2003. That means the gender gap has closed somewhat since 2001, when it stood at 16 per cent.
Women with more than 20 years experience actually earn more than men with the same experience while those with less than five years are pretty much on par. But the gap is significant for women with 10 to 20 years under their belt — that group earned 22 per cent less than men, according to the study.
The results of the survey are based on responses from about 16,500 AIMR members (2,183 in Canada) compiled by Withlin Worldwide, an independent market research firm. The survey was conducted in the first quarter of 2003.
The Association for Investment Management and Research (AIMR) is a non-profit membership organization of investment professionals headquartered in Charlottesville, Va.
Russell Reynolds Associates is a New York-based executive recruiting consulting firm.
