Putnam Investments paid two of its top portfolio managers "lavish compensation" in 2000, according to todays Wall Street Journal, citing an SEC report. Justin M. Scott received $14.3 million, while Omid Kamshad got $8.7 million. The two are now under SEC and Massachusetts investigation for market timing.
And while their salaries eclipsed the $6.8 million that the CEO of Putnams parent company, Marsh & McLennan, received in 2000, Putnams CEO at the time, the now controversial Larry Lasser, got $35 million. Attorneys for Scott and Kamshad declined to comment for the Journal.
John Hill, chairman of the Putnam board, said that while these salaries might seem high, Putnam pays its executives in line with industry standards. "Only a handful of portfolio managers at Putnam makes these numbers," Hill said . Russell Reynolds estimates the median pay for equity fund managers was $325,000 in 2003.
The SEC is considering new rules that would require fund companies to disclose pay structures, but not the dollar amounts, for their top executives. Putnam has announced it wants to share this information, but Hill said he, like many others in the industry, is opposed to disclosing hard salary figures for fear of losing top talent, or not being able to attract them in the first place.
Nonetheless, shareholder advocates and industry critics think that information should be made available.
The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.