Standard Life Aberdeen told its employees that some of them won't be getting bonuses this year.
The asset manager's bonus pot will be smaller than in previous years, and payouts will go to those who have made a "particularly strong contribution," a spokesman for Standard Life Aberdeen said in an emailed statement. That means not all of the firm's nearly 4,900 employees in the U.K. will get something extra in their paychecks.
Chief Executive Officer Stephen Bird, who joined in September after more than two decades at Citigroup, announced the policy on a video call last week. He said the firm wouldn't spread bonuses out "like peanut butter across the whole company because it then doesn't send a message," a published report said. Mr. Bird said the business was inefficient, and staff shouldn't expect regular salary increases.
Standard Life Aberdeen was created in a 2017 merger that was intended to help it grow quickly to compete with the industry's giants. Then co-CEO Martin Gilbert said at the time that the firm had the chance to make it to the $1 trillion club. Instead, investors have pulled money every year since the tie-up, and assets under management have declined to £512 billion pounds ($702 billion).
Mr. Bird said in an interview late last year that he plans to reverse the investor exodus by building a stable of passive products that could eventually account for as much as 30% of the firm's assets. His overhaul involves investment in key areas, such as developing inexpensive exchange-traded funds.
It's not clear if Mr. Bird himself will get a bonus, since pay policy will be set by the company's executive remuneration committee and must be approved by shareholders. Mr. Bird has a base salary of £875,000 and is eligible for a bonus of as much as £2.2 million, according to the company's website. He could also be awarded shares worth as much as £3.1 million, as well as cash allowance of £157,500.
The details of Mr. Bird's remuneration will be announced in March along with the company's earnings. His 2020 payout will be pro-rated to reflect his joining the company part way through the year.