BT Investment Management (BTIM) has shifted the rest of its core investment boutiques across to a profit sharing business model so that the company is better aligned to client and shareholder interests.
The company's chief executive Emilio Gonzalez said that the income boutique, led by Vimal Gor and the macro team, headed up by Joe Bracken, had successfully transitioned onto the model during the six months to March 2011.
The change meant that the investment teams would share in the revenue that their individual boutiques earned, rather than be tied to the corporate bonus pool.
Gonzalez said that BTIM's Australian equities boutique, headed by Crispin Murray, had already been fixed to the profit share model when the company floated in 2007, but transitioning the other two boutiques was delayed because of the global financial crisis.
"We felt it was important to move our other asset classes, income and macro, on the same basis. The profit-sharing model has held up, it gives the boutiques a share of the revenue that they themselves generate," he told InvestorDaily.
"It gives the boutiques autonomy in terms of how they run their business; we do all the support, the infrastructure, the finance, the sales, the marketing, the branding, the distribution - they run the money and they effectively employ their own people, run their own funds and get a cut of the business depending on the FUM (funds under management) or revenue they generate," Gonzales said.
"So the boutiques will only do well if the funds do well. If the funds do well the clients do well and they will generate revenue. There is a very clear line of sight between what you do and what you earn, as opposed to being part of the corporate pool," he added.
The three core boutiques manage over 85 per cent of BTIM's $36.1 billion in FUM, and offer products including Australian equities, fixed income, global macro and diversified funds.
The changes were announced when BTIM posted its interim results on 2 May.
