Lipper Fitzrovia Finds Rewards for Failure' in Funds Industry

Summary

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LONDON (HedgeWorld.com) - It was only a few short years ago that, in the midst of a sharp stock market downturn, company shareholders really began to protest about what they saw as excessive executive compensation. Some companies' share prices were tanking, yet it seemed that the compensation packages of chief executives were destined for the moon. Someone termed these packages, which seemed to be swelling even as company performance deflated, "rewards for failure," and a movement was born. Since then, both investors and boards of directors at some companies have become more vigilant to ensure that compensation packages are aligned with the shareholder value they are perceived to have added.

The same should also happen in the funds industry, right? Funds that perform better will attract more investors, and even if they do charge performance fees, these will be justified by their returns?

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Extract

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Lipper Fitzrovia Finds Rewards for Failure' in Funds Industry

Not always. Research released today by Lipper Fitzrovia finds that in the funds industry too, "rewards for failure," althou...

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