Two thirds of Asia PE professionals expect pay rises in 2016 - survey

The size of these anticipated wage hikes are relatively modest, with the majority of respondents in Heidrick & Struggles' 2015-2016 Asia Pacific Private Equity Compensation Survey specifying increases of less than 10%. However, of the 45% who anticipate an increase in their 2015 bonuses, a substantial majority are looking for a hike of more than 20%.

The executive search firm spoke to 204 investment professionals across the region representing multiple PE investment strategies. Just under half of these individuals said they received an increase in base salary in 2015. This suggests some were disappointed, with 64% of respondents in last year's survey expecting an increase. Of that same batch, only 38% received a pay rise in 2014.

Most of those reporting an increase in base salary for 2015 were top-level executives, categorized as partners, managing partners and managing directors.

Overall compensation continues to rise at all levels. The average base salary for a top-tier professional was $423,700 in 2015, up from $407,740 in 2014 and $392,760 in 2013. Over the same three-year period, the average bonus has gone from $320,310 to $381,390 and then $388,750.

The average mid-level base salary was $208,400 last year with a mean bonus of $187,090. This compares to $181,150 and $149,850 in 2013. Associates and senior associates that were receiving $103,350 in base salary and $87,950 in bonus in 2013 were on $133,560 plus $131,430, respectively, in 2015.

The payment disparity between global and regional firms has narrowed in recent years, but regional players are still seen as lacking in the clear communication of compensation policies internally. Only about one third of mid-level executives and just under half of senior-level executives at regional firms believe there is transparency in this area, compared to 43% and 52% at global firms.

All GPs appear to be failing to explain their succession plans for senior leaders in Asia. More than half of senior level executives and just over 40% of mid-level talent said there was no plan in place.

Heidrick & Struggles noted that competition for talent remains strong, identifying three key contributing factors: rising demand for operating professionals as firms increasingly target control transactions and emphasize value creation; growth in new fund initiatives such as credit, real assets and technology as existing platforms broaden their offerings and new players arrive with niche strategies; and LPs seeking to recruit GP talent as they grow their direct exposure.

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