Vanguard increased its annual bonuses for partnership units in 2005 to $81.40, up 13% from $72.05 in 2004, but the amount is still almost 20% lower than the $100 per partnership unit that Vanguard Chairman John Brennan set as a goal in 2002, the Philadelphia Inquirer reports.


John Demming, a Vanguard spokesman, declined to comment on the bonuses, saying the company does not comment on salary-related matters. But he did point out how Vanguard continues to charge some of the lowest fees in the industry while delivering solid performance. "When you look at what we've been able to achieve for the client, I think we've done a terrific job," Demming said. "Costs are down, and the funds have performed really well."


Daniel P. Wiener, editor of the Independent Adviser for Vanguard Investors, figures Vanguard probably fell short of its goal because it has introduced a number of new products and services in the past few years, and while it has continued to attract some of the biggest inflows in the industry - with $795.3 billion under management, it is the nation's third-largest fund company - attendant with the growth is higher overhead.

Vanguard has expanded its offerings to include fee-based research and actively managed mutual funds, including lifecycle funds.

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