Sanlam trims bonuses for Steinhoff exposure
Sanlam CEO Ian Kirk takes a reduction of R2.5m, while 100 employees will be affected by the trim in incentives
Sanlam CEO Ian Kirk is taking a 20% cut on his 2017 bonus, a reduction of R2.5m, as part of a company-wide trim to incentives relating to Steinhoff exposure contained in client funds.
"It was the right thing to do. Sanlam clients who suffered losses on Steinhoff would be asking, ‘How are Sanlam executives suffering?’," Kirk, who would not have been directly involved in decisions to buy Steinhoff shares, said on Thursday, following the group’s annual results.
The move is highly unusual in an industry that is frequently criticised for accepting handsome performance fees when funds do well, but seldom participating in the downside to the same degree.
"Asset managers derive a fee irrespective of whether a fund has performed or not," said shareholder activist Theo Botha, an open critic of Coronation’s opaque bonus structures.
"It will be interesting to see what other asset managers do" in the light of Sanlam’s move.
About 100 employees across Sanlam, including in its investments business, capital markets unit and among executives, would be affected by incentive cuts totalling R50m.
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