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Talent +
Technology
Man Group plc
Annual Report 2023
Man Group is
a technology-
empowered
active investment
management
firm
Contents
Strategic report
At a glance
Chair’s statement
Our business model
Our market
Our strategy
Chief Executive Officer’s review
Key performance indicators
Chief Financial Officer’s review
Risk management
People and culture
Sustainability and responsibility
TCFD
Non-financial and sustainability
information statement
Governance
Governance overview
Chair’s governance overview
Governance structure
Board of Directors and
Company Secretary
Executive Committee
Board activities
Stakeholder engagement
Board effectiveness
Board evaluation
Audit and Risk Committee report
Nomination and Governance
Committee report
Directors’ Remuneration report
Directors’ report
Directors’ responsibility statement
Financial statements
Independent auditor’s report
Group income statement
Group statement of
comprehensive income
Group balance sheet
Group cash flow statement
Group statement of changes
in equity
Notes to the Group financial
statements
Five-year record
Alternative performance measures
Shareholder information
Shareholder information
Glossary
1
02
04
10
12
14
16
20
22
28
38
46
62
65
68
69
70
72
74
76
78
84
86
88
96
100
124
126
128
138
138
139
140
141
142
174
175
180
182
The Strategic report was approved by the
Board and signed on its behalf by:
Robyn Grew
Chief Executive Officer
with
1,790
employees
from
70+
countries.
We trade in
825+
markets around the world
and offer
85+
alternative and long-only
investment strategies
to help our
690+
institutional clients meet
their investment goals.
Man Group plc
| Annual Report 2023
2
At a glance
Our proposition is strong
Our purpose
Who we are
We are a technology-
empowered active
investment management
firm focused on delivering
outperformance for our
clients and the millions
of savers they represent.
What we do
We actively manage investments of $167.5 billion in active
alternative and long-only strategies, run on a quantitative
and discretionary basis across liquid and private markets.
We drive long-term growth through our continued
focus on:
Talent+ go to page 36
Technology+ go to page 8
Sustainability+ go to page 44
Data as at 31 December 2023.
Our culture
We have an inclusive, meritocratic culture designed
to achieve excellence through collaboration and
differentiated thinking.
Man Group plc | Annual Report 2023
Assets under management (AUM) by
product category
Absolute return
$47.7bn
Total return
$42.5bn
Multi-manager solutions
$19.4bn
Systematic long-only
$36.5bn
Discretionary long-only
$21.4bn
AUM by strategy type
Alternative
Long-only
$109.6bn
$57.9bn
$167.5bn
AUM by client type
Institutional
Intermediaries
78%
22%
Strategic report 3
Our principles
Our business principles are designed to distil
and define our key priorities, values and culture.
Performance
We focus on achieving superior risk-adjusted
performance.
Clients
Our clients are at the heart of everything we do.
Differentiation
We seek to be differentiated and original in
our thinking.
Excellence
Good is not enough, we strive to be excellent
in all we do.
Responsibility
Our people do the right thing and conduct
business with the highest standards of integrity.
Meritocracy
We succeed through talent, commitment,
diligence and teamwork.
AUM by client domicile
35%
Americas
43%
EMEA
22%
Asia Pacific
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 4
Chair’s statement
Assets under management
$167.5bn
+17%
2022: $143.3bn
Core EPS (diluted)
22.4¢
-54%
2022: 48.7¢
Statutory EPS (diluted)
19.4¢
-58%
2022: 45.8¢
Proposed dividend per share
16.3¢
+4%
2022: 15.7¢
We are focused on delivering
superior performance and
client solutions, deploying the
latest technology across our
business to ensure that we
are well positioned for growth
in the future.
Anne Wade | Chair
Man Group plc
| Annual Report 2023
Strategic report 5
I am pleased to present the
Annual Report for 2023, my
first as Chair of Man Group.
Overview of the year
Inflation and the uncertainty around near-term
interest rates have dominated the story of
the financial markets in 2023. While equity
markets delivered strongly positive returns,
the financial landscape was not without its
share of turbulence. This created challenging
investing conditions for active investment
managers and tested allocators’ appetite
for risk.
Nevertheless, Man Group’s performance
was resilient, and I am encouraged by the
progress we have made during the year. As
an active manager with clients at the centre of
what we do, we are committed to leveraging
our technology and investment expertise to
maximise the value we add for our clients and
the many individual savers and pensioners
that they represent. We were pleased to
have delivered +1.6% of relative investment
performance during the year and recorded a
net inflow of client capital 4.9% ahead of the
industry. Combined with tailwinds from
market beta, currency fluctuations and the
acquisition of Varagon Capital Partners,
our AUM ended the year at $167.5 billion,
a 17% increase compared with the beginning
of the year.
We delivered solid core management fee
profit before tax1 of $280 million, 3% lower
than in 2022 driven by higher fixed cash
costs owing to planned investment to
support growth, and lower core performance
fee profit before tax of $60 million following
a record year for our trend-following absolute
return strategies in 2022. This led to lower
statutory profit before tax of $279 million
compared with $745 million in 2022.
1 Man Group’s alternative performance measures are outlined
on pages 175 to 179.
Man Group plc | Annual Report 2023
Board changes
2023 was a year of transition at Man Group
and I’m pleased to report that this has all
gone smoothly. John Cryan, who served as a
director of the Company since January 2015
and as Chair since January 2020, retired
from the Board at the end of September. We
benefited enormously from John’s experience
and wisdom and on behalf of everyone at
Man Group, I wish him well for the future.
I was delighted to take on the role of Chair
as of 1 October. Since my appointment to
the Board in 2020, I have been incredibly
impressed with the culture and talent at
Man Group. The firm is well positioned to
capitalise on its investment expertise and
first-class technology capabilities to deliver
outperformance for our clients and excellent
value to our shareholders.
In May, Luke Ellis took the decision to retire
from the Board and his role as CEO after
seven years at the helm. He has been a
superb leader, inspiring the firm to reposition
itself for the future and working closely with
his senior management team to oversee a
period of tremendous growth. I’d like to
thank Luke and wish him the very best for
his retirement.
A key role of the Board is to ensure that there
are appropriate succession plans in place,
and it was a pleasure to announce Robyn
Grew as the new CEO of Man Group.
Robyn is a dynamic, strategic leader who
has been integral to the firm’s growth over
the past decade. Her previous wide-ranging
responsibilities, spanning from investment
functions and risk to trading and operations,
have provided her with broad experience and
a deep understanding of the business. Robyn
has rapidly stepped into her new role, leading
the firm on the next phase of its journey. She
has reorganised her executive team, who
represent core functions from across the firm
and will support her in delivering on the firm’s
strategic priorities. Further information can be
found in the Governance section on pages 74
and 75.
I would also like formally to welcome Laurie
Fitch as a non-executive director. Laurie
brings extensive experience as an equity
investor and banker, as well as strong
strategic insight and international perspective.
She is already adding significant value to
Man Group and complements the skill set of
the Board as a whole. Laurie succeeded me
as Chair of the Remuneration Committee with
effect from 1 October 2023.
Kate Barker and Jackie Hunt stepped down
from our Board in 2023. I would like to thank
them both for their excellent contribution to
the Board and wish them all the best for the
future. Alberto Musalem also informed the
Board of his intention to step down as a
director with effect from 29 February 2024,
following the announcement of his
appointment as the next President and
Chief Executive Officer of the Federal
Reserve Bank of St. Louis. I wish Alberto
all the very best as he undertakes this
prestigious opportunity and thank him
for his invaluable contributions since
his appointment.
Board focus
The Board spent a significant amount of
time on strategic matters during 2023.
During our strategy sessions, we covered
a range of key topics that are critical to
our continuing success. We received in-
depth presentations from management on
investment performance, client relationships,
global distribution, resource allocation,
and key growth areas. These enabled
the Board to work in partnership with
the senior leadership team to ensure our
collective focus on the performance of our
investment strategies, the sourcing and
development of business opportunities,
the creation of customised solutions to
meet our clients’ needs and the investment
in our people and our technology.
We consider and challenge senior
management on the business case for any
acquisition to ensure it aligns with the firm’s
strategic priorities, fits within our distinctive
culture and presents the opportunity to
create long-term value for shareholders.
Our approach in the case of the Varagon
acquisition was no different; we spent
a significant amount of time evaluating
the opportunity with management. The
transaction furthers two core strategic
objectives for Man Group: first, to build a
diversified asset management business
with exposure to growing segments of
the asset management industry and
second, to develop further its presence in
the North American market. In structuring
the acquisition, we have aligned the
interests of Varagon management with
those of Man Group’s shareholders. From
a financial perspective, the transaction
provides the opportunity to achieve an
attractive risk-adjusted return on capital.
Having agreed the case for the acquisition,
the Board oversaw the due diligence
process and provided approval to proceed.
Strategic report | Governance | Financial statements | Shareholder information 6
Chair’s statement continued
As a Board, it is our responsibility
to champion a diverse firm and
an inclusive, collaborative culture
that our people are proud to be
associated with.
Anne Wade | Chair
Man Group plc | Annual Report 2023
Capital returns
Our dividend policy is progressive, taking
into account the growth in the firm’s overall
earnings. Our target remains to be able to
recommend annual dividends that grow
year-on-year. In line with our policy, the Board
has recommended a final dividend of 10.7¢
per share, which, when taken together with
the interim dividend already distributed,
amounts to a full year dividend of 16.3¢ per
share. This compares with the aggregate
dividend for 2022 of 15.7¢ per share, a 4%
increase. The final dividend recommendation
is, as usual, subject to approval by
shareholders at the Annual General Meeting
to be held in May 2024.
In addition to our dividend distribution policy,
we periodically review our accumulated
capital reserves – those we have not
previously distributed to shareholders as
dividends, used for organic growth initiatives
or for acquisitions – to determine whether
they exceed the amounts we need to retain
to ensure the safe, prudential and flexible
management of the Company. Where we
believe we have excess capital over and
above those needs, we seek to return
further value to shareholders beyond our
regular dividends.
Recently, we have done this by way of
share repurchases. In December 2022, we
announced a buyback programme of up to
$125 million. Execution of the programme
completed in March 2023; at which time we
announced a further $125 million of share
repurchases. This was completed in May
2023. The timing of share buybacks is,
of course, subject to prevailing market
conditions, and organic and inorganic
strategic opportunities. Share repurchases,
taken together with the interim and proposed
final dividend, resulted in total returns to
shareholders of $0.3 billion in the year.
This aggregate sum equates to roughly
9% of our market capitalisation as of
31 December 2023.
People and culture
Attracting, developing and retaining talent is
central to our success. Managing change is a
key requirement in today’s fast-moving world
and we recognise that building a deep talent
pool is central to our continued success. This
has been a significant area of focus during
the year, and we have spent time discussing
with senior management their ongoing work
to promote the development of talent within
the business.
As a Board, it is our responsibility to
champion a diverse firm and an inclusive,
collaborative culture that our people are
proud to be associated with. The Board
oversees activities in this area, encouraging
management in its promotion and
implementation of diversity at all levels of
the business. Man Group staff also continue
to contribute ideas and feedback through
various channels available to them.
More details of the Company’s initiatives
in this area can be found in the People and
culture section on page 38.
Strategic report 7
Workforce engagement
Community
We are also conscious of the impact our
organisation has on the broader community,
and we aim to contribute positively to those
around us. Our employees continue to
be directly involved in volunteering in our
communities and charitable initiatives through
our ManKind programme, more details of
which can be found on page 43. We also
work with the Man Charitable Trust in the
UK and our US-based Man Charitable
Foundation, as well as via direct donations
to support causes close to our employees or
other stakeholders.
On behalf of the Board, I would like to thank
all my colleagues for their dedication and
hard work, and all our shareholders for their
continuing support.
Anne Wade
Chair
When the Board takes important decisions,
specific consideration is always given to how
our employees might be impacted and we
monitor feedback on the choices made.
As part of this process, we engage formally
and directly with our employees across the
globe. While Ceci Kurzman is the Board’s
designated employee engagement
representative, we encourage all Board
members to engage with staff in formal
or informal settings during the year.
The September Board meeting was held in
New York, where we had the opportunity
to spend time with employees based there,
including the team at Varagon. We had very
positive feedback from both the Board and
employees on our direct engagement. The
Board has discussed and considered the
general employee engagement feedback
received to date, and we continue to assess
the most effective means of incorporating the
views of staff more explicitly into Board
decision-making.
More broadly, you can read about how
the Board considers the interests of our
stakeholders when complying with the
obligations of section 172 of the Companies
Act 2006 on pages 68 to 83.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 8
Technology is core to our strategy and part of our DNA as a
firm. Through early and continuous investment, we have built
a powerful, advanced technology platform that enables us to
operate flexibly and to grow efficiently. Our technology platform
drives our competitive advantage, powering our investment
processes and underpinning all data, research, trading,
risk management and settlement activities at the firm.
While artificial intelligence (AI) has taken the spotlight this year,
it is not new to us. It has been an area of expertise for over
ten years, from our pioneering research efforts in conjunction
with the Oxford-Man Institute to our extensive use of machine
learning in trade execution processes. In 2023, our dedicated
AI team led the launch of ManGPT, our in-house GenAI portal,
and continue to explore the applications of AI across the firm.
Technology
+Innovation
¬ For more information on technology,
please visit: www.man.com/technology
Man Group plc | Annual Report 2023
Strategic report 9
400+
of our people use ManGPT weekly
87%
of trades are automated
~40%
of employees are quants
or technologists
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 10
Our business model
Generating alpha at scale
We are a global leader in liquid alternatives and solutions,
with a differentiated business model and a track record of
delivering for our clients and shareholders.
Client
focus
We are focused on delivering
superior performance for our
clients and our relationship-driven
global sales effort enables us
to serve millions of people
around the world.
Range of
investment
strategies
We offer alternative and long-only
strategies run on a quantitative and
discretionary basis across liquid
and private markets, where each
investment team has the autonomy
to apply their own approach.
Bespoke
solutions
We understand the unique needs
of our clients and create solutions
tailored to meet their individual
risk, return, liquidity and
structuring requirements.
Single operating platform
Our infrastructure creates operating efficiencies throughout
the firm and provides scalable options for growth.
Talent+
We are fundamentally a
people business. Our deep
pool of talent and collaborative
culture are vital components
to ensure we deliver the best
possible outcomes for all
our stakeholders.
¬ See page 36
Technology+
We harness the power
of technology across
our business, from alpha
generation to operations,
and invest heavily every year
to remain cutting-edge.
Sustainability+
We conduct our business
with the highest standards
of integrity, and are committed
to running our company in
a responsible way as we
seek to grow.
¬ See page 8
¬ See page 44
Man Group plc | Annual Report 2023
Strategic report 11
Positioned for long-term
growth
Assets under management
We grow our AUM by delivering investment
performance for our clients, and by attracting
net inflows on a consistent basis. Through
continuous investment in our talent and
technology, we aim to deliver positive returns
in various market regimes. We focus on
building trusted long-term partnerships, with
an ongoing push to identify what is valuable
to the largest allocators in the world. By
offering them access to a compelling range
of investment strategies and solutions, we aim
to gain market share on a sustainable basis.
Revenue
Management fee revenue is typically
charged as a percentage of assets under
management or net asset value. The range
of investment strategies we offer means our
management fee revenue has relatively low
exposure to equity beta. We remain focused
on diversifying this earnings stream further
through organic innovation, hiring investment
teams and acquiring other businesses.
Performance fee revenue, which is typically
charged as a percentage of investment
performance above a benchmark return
or previous valuation ‘high-water mark’,
aligns our objectives with those of our
clients. This is a meaningful, recurring
earnings stream that generates capital
to invest in organic and inorganic growth
initiatives, or to return to shareholders.
Profit
We continuously invest in our talent and
technology to maintain our competitive
advantage. Technology underpins every
aspect of what we do at Man Group.
The strength and flexibility of our platform
supports a high degree of automation,
which drives efficiency and significant
operating leverage across the business.
If we continue to maintain the cost
discipline we have in the past, this helps
us grow profit faster than revenue.
Our profit converts to cash quickly, and we
have a clear, disciplined capital management
framework. Our ordinary dividend policy is
progressive, taking into account the growth in
the firm’s overall earnings. We assess organic
and inorganic investment opportunities to
support future growth on an ongoing basis
and distribute any capital surplus to our
requirements to shareholders.
¬ See page 24
Shareholder value
Delivering for our stakeholders
Clients
Investment performance
1.6%
outperformance relative to peers
Servicing clients’ needs
$108.8bn
¬ See page 17
AUM customised for individual client needs
¬ See page 12
Employees
Employee engagement score
81%
Internal mobility
200+
Shareholders
Shareholder returns
$1.8bn
¬ See page 38
¬ See page 39
of dividends and buybacks in the last five years
¬ See page 24
Dividends and share buybacks
$0.3bn
in relation to 2023
Communities
400+
employees volunteered during 2023
¬ See page 43
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
12
Our market
Market environment and industry trends
We believe we are well positioned for continued growth
against the backdrop of the key trends affecting the asset
management industry.
Market
Macro environment
Description
• Inflation and the associated monetary policy responses from
central banks continued to dominate headlines throughout 2023.
• The collapse of Silicon Valley Bank in March 2023 was the
largest bank failure since 2008, resulting in the biggest daily
decline in two-year US Treasury yields in 30 years.
• Advances in AI came into the spotlight during the year.
The ‘Magnificent Seven’ Wall Street stocks, all with perceived
significant AI capabilities, soared between 48% and 239%
in 2023, accounting for the vast majority of the S&P 500’s
24% gain.
• Geopolitical events in the Middle East and fears of war
continuing in Ukraine led to renewed volatility and uncertainty
in markets.
• Global equity markets ended the year strongly as greater visibility
on peak central bank rates and the potential for future cuts
boosted investor sentiment.
Industry
Evolving client requirements
Description
• Clients faced challenges navigating uncertain markets during
the year, and are looking for strong partnerships to address
their evolving requirements and provide customised options to
satisfy their individual risk appetites.
• Solutions offerings have gained traction globally and the demand
for customised portfolios is expected to keep growing as
institutional clients seek tactical flexibility and cost efficiencies1.
• Alternative assets grew to 21% of global AUM as at the end of
2022, although accounted for half of the asset management
industry’s revenues. This momentum is expected to continue
at a CAGR of 7% in alternative assets over the next five years2.
• The democratisation of alternatives is expected to be a key
theme; for example, wealth investors are expected to allocate
more than 15% of their eligible portfolios to private alternatives
over the next three to five years2.
What this means for Man Group
What this means for Man Group
What this means for Man Group
What this means for Man Group
• By trading a wide range of macro instruments, as well as
• 2023 was our fourth consecutive year of net inflows,
traditional asset classes, our strategies are able to generate
diversifying alpha in varied macro regimes.
• Significant trend-reversals, such as occurred in March 2023,
proved a challenging environment for our trend-following absolute
return strategies; however, our ability to adapt quickly allowed us
to outperform our peers in the period.
• Innovation and research are at the core of what we do, and we
are constantly working to generate new technology-enabled
sources of alpha.
demonstrating the strength of our client relationships around
the world and our ability to help them navigate a range of
market conditions.
• Our institutional resources and infrastructure can deal with
scale and complexity, delivering better outcomes for clients.
$108.8 billion of our total AUM relates to mandates with some
level of customisation for individual client needs.
• We offer 85+ investment strategies and have the ability
to create a powerful combined offering for our clients.
• Our discretionary absolute return strategies delivered particularly
• We are a market leader3 in alternatives, with over
strong returns, notably GLG Alpha Select (+10.2%).
• We continue to invest in and maintain the highest standards of
risk management across our product range, and we are well
positioned to manage client capital through turbulent periods.
• We saw strong long-only performance in 2023, demonstrating
the need for a diversified array of investment capabilities.
• The acquisition of Varagon added to our growing capabilities
in credit and private markets.
35 years of experience and $109.6 billion of our AUM
in alternative strategies.
• We have also seen considerable growth through wealth
channels in our business, with successful partnerships
in the US and Japan.
1 Source: McKinsey & Company ‘Everything everywhere all at once: North American asset
management 2023’.
2 Source: BCG ‘The Tide Has Turned: Global Asset Management 2023’ report.
3 Source: P&I, largest hedge fund managers in 2022.
Man Group plc | Annual Report 2023
Quant and technology
Description
Climate and ESG
Description
• Quant continues to be a clear trend in the hedge fund industry
• Climate remains at the top of the environment, social and
with 47% of funds operating a quant or hybrid investment style4
governance (ESG) agenda, with a particular focus on measuring
and over $1 trillion of assets managed in quant-focused funds
the financial materiality of climate change and how companies
in March 20235.
• Gathering and governing data at-scale continues to be a
can credibly achieve their net zero commitments and achieve
real-world decarbonisation.
key competitive advantage that enables innovative investment
• We continued to see divergence in attitudes towards ESG
research across new markets and strategies and drives firm-wide
investing across jurisdictions.
efficiencies through the curation and use of internal data assets.
• ESG regulatory complexity continued to rise, with further
• Generative AI has quickly emerged as a new paradigm for asset
developments related to the EU’s Sustainable Finance Disclosure
managers. With 85% of firms evaluating GenAI tools to support
Regulation (SFDR) and the UK announcing fund-labelling rules
their workflows6, the ability to extract and curate information from
via the Sustainability Disclosure Requirements (SDR). In the US,
large and varied sources of data, to boost the productivity of
the potential implementation of the US Securities and Exchange
human capital, and to streamline processes will present significant
Commission’s proposed ESG disclosure regulations was delayed
opportunities for those that can harness this technology at scale.
until 2024.
• Actively managed quant credit continues to grow as an asset
• We saw increased attention on themes related to biodiversity
class. With significant improvements in liquidity and electronic
and nature, affordability, and impact measurement.
execution7, this asset class is expected to grow beyond bonds
and credit default swaps to target other fixed-income products.
• Our proprietary technology platform is supported by
over 675 quants, engineers and data scientists.
• Artificial intelligence is not new for us: it augments our capabilities
in research processes, data analysis, trade execution and software
development. We launched our in-house GenAI portal, ManGPT,
along with a robust AI governance framework.
• We continue to enable innovative investment research techniques
with proprietary software whilst also actively contributing to the
open-source software community.
• Our strides in supporting credit, and specifically quant credit
in our data, research, risk and electronic execution capabilities
were showcased to our clients at the inaugural Man Technology
Conference in 2023, alongside our expertise in data, analytics
and portfolio construction.
• Our ArcticDB timeseries database was launched publicly in
partnership with Bloomberg in 2023, confirming our conviction
that we really are at the forefront. This milestone was a
strong validation of our technology with ArcticDB boasting
cutting-edge features.
• We continue to invest in our climate capabilities and now have
two full-time climate scientists and have furthered our academic
partnerships. By bringing our quantitative skills to a qualitative area
with inconsistent datasets, we are able to enhance climate data
and leverage our ESG tools to help us more effectively identify and
manage climate-related risks and opportunities.
• We recognise that our clients may have different investment
priorities and we consider financially material factors that support
their investment objectives. We focus on providing tailored
solutions to meet clients’ specific requirements.
• In 2023, we enhanced our suite of responsible investment (RI)
products, offering a total of 39 ESG-oriented funds8, following a
data-driven approach to developing RI solutions for our clients.
Man Group’s ESG-integrated AUM grew by 19%, to $59.3 billion
of our AUM in the year.
• We have strong frameworks and control functions to ensure
alignment with rapidly evolving regulatory environments. Further
details on our ESG governance structure can be found on page 47.
• We have expanded our RI research capabilities, with key focus
areas including biodiversity and nature considerations, as well as
impact measurement.
Strategic report
13
Quant and technology
Description
Climate and ESG
Description
• Quant continues to be a clear trend in the hedge fund industry
with 47% of funds operating a quant or hybrid investment style4
and over $1 trillion of assets managed in quant-focused funds
in March 20235.
• Gathering and governing data at-scale continues to be a
key competitive advantage that enables innovative investment
research across new markets and strategies and drives firm-wide
efficiencies through the curation and use of internal data assets.
• Generative AI has quickly emerged as a new paradigm for asset
managers. With 85% of firms evaluating GenAI tools to support
their workflows6, the ability to extract and curate information from
large and varied sources of data, to boost the productivity of
human capital, and to streamline processes will present significant
opportunities for those that can harness this technology at scale.
• Actively managed quant credit continues to grow as an asset
class. With significant improvements in liquidity and electronic
execution7, this asset class is expected to grow beyond bonds
and credit default swaps to target other fixed-income products.
• Climate remains at the top of the environment, social and
governance (ESG) agenda, with a particular focus on measuring
the financial materiality of climate change and how companies
can credibly achieve their net zero commitments and achieve
real-world decarbonisation.
• We continued to see divergence in attitudes towards ESG
investing across jurisdictions.
• ESG regulatory complexity continued to rise, with further
developments related to the EU’s Sustainable Finance Disclosure
Regulation (SFDR) and the UK announcing fund-labelling rules
via the Sustainability Disclosure Requirements (SDR). In the US,
the potential implementation of the US Securities and Exchange
Commission’s proposed ESG disclosure regulations was delayed
until 2024.
• We saw increased attention on themes related to biodiversity
and nature, affordability, and impact measurement.
What this means for Man Group
What this means for Man Group
What this means for Man Group
What this means for Man Group
• Our proprietary technology platform is supported by
over 675 quants, engineers and data scientists.
• Artificial intelligence is not new for us: it augments our capabilities
in research processes, data analysis, trade execution and software
development. We launched our in-house GenAI portal, ManGPT,
along with a robust AI governance framework.
• We continue to enable innovative investment research techniques
with proprietary software whilst also actively contributing to the
open-source software community.
• Our strides in supporting credit, and specifically quant credit
in our data, research, risk and electronic execution capabilities
were showcased to our clients at the inaugural Man Technology
Conference in 2023, alongside our expertise in data, analytics
and portfolio construction.
• Our ArcticDB timeseries database was launched publicly in
partnership with Bloomberg in 2023, confirming our conviction
that we really are at the forefront. This milestone was a
strong validation of our technology with ArcticDB boasting
cutting-edge features.
• We continue to invest in our climate capabilities and now have
two full-time climate scientists and have furthered our academic
partnerships. By bringing our quantitative skills to a qualitative area
with inconsistent datasets, we are able to enhance climate data
and leverage our ESG tools to help us more effectively identify and
manage climate-related risks and opportunities.
• We recognise that our clients may have different investment
priorities and we consider financially material factors that support
their investment objectives. We focus on providing tailored
solutions to meet clients’ specific requirements.
• In 2023, we enhanced our suite of responsible investment (RI)
products, offering a total of 39 ESG-oriented funds8, following a
data-driven approach to developing RI solutions for our clients.
Man Group’s ESG-integrated AUM grew by 19%, to $59.3 billion
of our AUM in the year.
• We have strong frameworks and control functions to ensure
alignment with rapidly evolving regulatory environments. Further
details on our ESG governance structure can be found on page 47.
• We have expanded our RI research capabilities, with key focus
areas including biodiversity and nature considerations, as well as
impact measurement.
4 Source: SigTech, February 2023 ‘State of the Hedge Fund Industry’.
5 Source: The Wall Street Journal, May 2023 ‘Why Are Markets So Calm?
It’s revenge of the Quant Funds’.
6 Source: AIMA Generative AI Survey, Initial Findings, December 2023.
7 Source: Man Institute, August 2023 ‘Is the Future of Credit Quantitative?’.
8 ESG-oriented funds are made up of 30 Article 8 and 9 Article 9 funds under SFDR.
Man Group plc | Annual Report 2023
Market
Macro environment
Description
Evolving client requirements
Industry
Description
• Inflation and the associated monetary policy responses from
• Clients faced challenges navigating uncertain markets during
central banks continued to dominate headlines throughout 2023.
the year, and are looking for strong partnerships to address
• The collapse of Silicon Valley Bank in March 2023 was the
largest bank failure since 2008, resulting in the biggest daily
their evolving requirements and provide customised options to
satisfy their individual risk appetites.
decline in two-year US Treasury yields in 30 years.
• Solutions offerings have gained traction globally and the demand
• Advances in AI came into the spotlight during the year.
The ‘Magnificent Seven’ Wall Street stocks, all with perceived
significant AI capabilities, soared between 48% and 239%
in 2023, accounting for the vast majority of the S&P 500’s
24% gain.
in markets.
• Global equity markets ended the year strongly as greater visibility
on peak central bank rates and the potential for future cuts
boosted investor sentiment.
for customised portfolios is expected to keep growing as
institutional clients seek tactical flexibility and cost efficiencies1.
• Alternative assets grew to 21% of global AUM as at the end of
2022, although accounted for half of the asset management
industry’s revenues. This momentum is expected to continue
at a CAGR of 7% in alternative assets over the next five years2.
theme; for example, wealth investors are expected to allocate
more than 15% of their eligible portfolios to private alternatives
over the next three to five years2.
• Geopolitical events in the Middle East and fears of war
continuing in Ukraine led to renewed volatility and uncertainty
• The democratisation of alternatives is expected to be a key
• By trading a wide range of macro instruments, as well as
• 2023 was our fourth consecutive year of net inflows,
traditional asset classes, our strategies are able to generate
demonstrating the strength of our client relationships around
diversifying alpha in varied macro regimes.
the world and our ability to help them navigate a range of
• Significant trend-reversals, such as occurred in March 2023,
market conditions.
proved a challenging environment for our trend-following absolute
• Our institutional resources and infrastructure can deal with
return strategies; however, our ability to adapt quickly allowed us
scale and complexity, delivering better outcomes for clients.
to outperform our peers in the period.
• Innovation and research are at the core of what we do, and we
$108.8 billion of our total AUM relates to mandates with some
level of customisation for individual client needs.
are constantly working to generate new technology-enabled
• We offer 85+ investment strategies and have the ability
sources of alpha.
to create a powerful combined offering for our clients.
• Our discretionary absolute return strategies delivered particularly
• We are a market leader3 in alternatives, with over
strong returns, notably GLG Alpha Select (+10.2%).
35 years of experience and $109.6 billion of our AUM
• We continue to invest in and maintain the highest standards of
in alternative strategies.
risk management across our product range, and we are well
• We have also seen considerable growth through wealth
positioned to manage client capital through turbulent periods.
channels in our business, with successful partnerships
in the US and Japan.
• We saw strong long-only performance in 2023, demonstrating
the need for a diversified array of investment capabilities.
• The acquisition of Varagon added to our growing capabilities
in credit and private markets.
Strategic report | Governance | Financial statements | Shareholder information
14
Our strategy
Driving continuous growth
We leverage our 35+ years of experience investing
to deliver scalable alpha and customised solutions
for our clients.
Four main strategic pillars drive value for our firm.
Our strategic pillars are linked to our financial
KPIs, as set out below, and on page 20.
1 Relative investment performance
2 Relative net flows
3 Core EPS (diluted)
4 Core management fee EPS (diluted) growth
Innovative
investment strategies
Strong
client relationships
Efficient and
effective operations
Combining our exceptional talent
and market-leading technology
to generate superior risk-adjusted
investment returns for our clients.
Building long-term partnerships with clients,
through one point of contact, to understand
their needs and offer tailored solutions
meeting their risk and return requirements.
Harnessing technology to power investment
performance and infrastructure, provide
scalable options for growth and create
operating efficiencies throughout the firm.
Returns
to shareholders
Generating excess capital either to reinvest
in our business to create long-term
value or returns to our shareholders.
Link to our key performance indicators
1 2 3 4
2 3 4
3 4
Through constant innovation, we find
new sources of alpha, maintain our
relevance with clients, diversify our
revenue sources and drive growth.
We aim to identify what is valuable to
our clients to attract net inflows and
gain market share on a consistent and
sustainable basis.
Through the technology-embedded
operating leverage inherent in our
business, and fixed cost discipline,
we can grow profits faster than revenue.
How we performed in 2023
• Positive investment performance of
$9.7 billion across all product categories.
• Net inflows in 2023 of $3.0 billion,
outperforming the industry by 4.9%1.
• Asset-weighted relative investment
• Strengthened our relationships with existing
outperformance of 1.6%.
• Strong relative investment outperformance
of 2.8% from long-only strategies.
• Robust risk management and powerful
central platform helped our trend-following
strategies navigate periods of market
volatility, driving relative investment
outperformance of 0.8% from
alternative strategies.
• Onboarded 170+ new datasets in 2023,
identifying alpha sources in over 90.
• Added significant private credit capabilities
to our diversified client offering through the
acquisition of Varagon.
clients: our top 50 clients invest in an average
of four products.
• Worked with clients to build solutions at scale:
AUM in Man Institutional Solutions has grown
to $16.2 billion.
• Focused on building new relationships: 14 new
clients each invested $50 million or more, and
a further 23 invested over $10 million with us.
• Expanded our presence in North America, a
strategically important market; 35% of our
AUM is from clients domiciled in the Americas.
• Announced a strategic partnership with
Fideuram – Intesa Sanpaolo Private Banking
to strengthen our presence in the European
intermediated retail channel.
Objectives for 2024
• Expand our capabilities in credit, both liquid
and private, and quant equities to diversify
our earnings further and build multiple
options for future growth.
• Collaborate across the business to develop
cross-content solutions and our multi-
strategy offering for clients.
• Continued focus on building long-term
partnerships with our clients as customisation
and transparency become increasingly
important to sophisticated investors.
• Extend our client reach in selected
markets (e.g. North America) and channels
(e.g. wealth, insurance) in which we see
growth opportunities.
¬ For more information on how risks relate to our strategy go to page 28.
Man Group plc | Annual Report 2023
•
Invested roughly $120 million into
our investment management and core
technology capabilities, which will further
support our ability to deliver for our clients
and shareholders.
• Launched an in-house GenAI portal, ManGPT,
which has led to significant usage of GenAI as
a productivity aid across the firm in a safe and
scalable manner.
• Signed a multi-year open-source technology
development and product integration
agreement with Bloomberg for our database
product, ArcticDB.
• Trained 230+ employees in Python and data
science skills in the year through five internally
developed courses in order to technically
upskill our people.
• Successful day one onboarding of Varagon
following completion in September 2023.
• Continue to invest in technology and talent
to maintain our competitive advantage.
• Maintain cost discipline and efficient
resource allocation.
1 2 3 4
Profitable growth allows us to continue
to invest in the business and return
capital in excess of our requirements
to shareholders.
How we performed in 2023
• Proposed full year 2023 dividend of 16.3¢,
4% higher than full year 2022 dividend of 15.7¢,
in line with our progressive dividend policy.
• Completed the two $125 million share
buybacks announced in December 2022
and March 2023.
• Completed the acquisition of Varagon,
which we expect to be meaningfully
accretive to earnings in the first full year
following completion.
•
Increased the size of our revolving credit facility
to $800 million to reflect the growth of our
business since the previous facility was put
in place in 2019. We plan to link the facility to
ESG-based KPIs in 2024.
• Continue to have a strong, liquid balance sheet
with $555 million of net financial assets2.
Objectives for 2024
• Assess organic capital deployment or
potential acquisition opportunities alongside
• Maintain focus on balance sheet flexibility
capital returns.
and efficiency.
Strategic report 15
Innovative
Strong
investment strategies
client relationships
Efficient and
effective operations
Combining our exceptional talent
and market-leading technology
to generate superior risk-adjusted
investment returns for our clients.
Building long-term partnerships with clients,
Harnessing technology to power investment
through one point of contact, to understand
performance and infrastructure, provide
their needs and offer tailored solutions
scalable options for growth and create
meeting their risk and return requirements.
operating efficiencies throughout the firm.
Returns
to shareholders
Generating excess capital either to reinvest
in our business to create long-term
value or returns to our shareholders.
Link to our key performance indicators
1 2 3 4
2 3 4
3 4
Through constant innovation, we find
We aim to identify what is valuable to
our clients to attract net inflows and
Through the technology-embedded
operating leverage inherent in our
gain market share on a consistent and
business, and fixed cost discipline,
sustainable basis.
we can grow profits faster than revenue.
new sources of alpha, maintain our
relevance with clients, diversify our
revenue sources and drive growth.
How we performed in 2023
• Positive investment performance of
$9.7 billion across all product categories.
• Net inflows in 2023 of $3.0 billion,
outperforming the industry by 4.9%1.
• Asset-weighted relative investment
outperformance of 1.6%.
• Strengthened our relationships with existing
clients: our top 50 clients invest in an average
• Strong relative investment outperformance
of 2.8% from long-only strategies.
• Robust risk management and powerful
central platform helped our trend-following
strategies navigate periods of market
volatility, driving relative investment
outperformance of 0.8% from
alternative strategies.
• Onboarded 170+ new datasets in 2023,
identifying alpha sources in over 90.
of four products.
• Worked with clients to build solutions at scale:
AUM in Man Institutional Solutions has grown
to $16.2 billion.
• Focused on building new relationships: 14 new
clients each invested $50 million or more, and
a further 23 invested over $10 million with us.
• Expanded our presence in North America, a
strategically important market; 35% of our
AUM is from clients domiciled in the Americas.
• Added significant private credit capabilities
• Announced a strategic partnership with
to our diversified client offering through the
acquisition of Varagon.
Fideuram – Intesa Sanpaolo Private Banking
to strengthen our presence in the European
intermediated retail channel.
•
Invested roughly $120 million into
our investment management and core
technology capabilities, which will further
support our ability to deliver for our clients
and shareholders.
• Launched an in-house GenAI portal, ManGPT,
which has led to significant usage of GenAI as
a productivity aid across the firm in a safe and
scalable manner.
• Signed a multi-year open-source technology
development and product integration
agreement with Bloomberg for our database
product, ArcticDB.
• Trained 230+ employees in Python and data
science skills in the year through five internally
developed courses in order to technically
upskill our people.
• Successful day one onboarding of Varagon
following completion in September 2023.
Objectives for 2024
• Expand our capabilities in credit, both liquid
• Continued focus on building long-term
• Continue to invest in technology and talent
and private, and quant equities to diversify
our earnings further and build multiple
options for future growth.
partnerships with our clients as customisation
to maintain our competitive advantage.
and transparency become increasingly
important to sophisticated investors.
• Maintain cost discipline and efficient
resource allocation.
• Collaborate across the business to develop
• Extend our client reach in selected
cross-content solutions and our multi-
strategy offering for clients.
markets (e.g. North America) and channels
(e.g. wealth, insurance) in which we see
growth opportunities.
Varagon acquisition
Varagon has established itself as a leader in direct lending within the core
US middle-market since its inception in 2014. Through superior origination
capabilities, underwriting discipline and risk management, the team have
a strong track record of generating differentiated returns for a sophisticated
client base in the insurance channel.
As the private credit market continues to grow in relevance for the world’s
largest institutions, Varagon adds a US-focused private credit strategy
designed to provide consistent risk-adjusted outperformance at scale,
and in a highly customisable format.
AUM in US direct lending
$10.8bn
1 2 3 4
Profitable growth allows us to continue
to invest in the business and return
capital in excess of our requirements
to shareholders.
How we performed in 2023
• Proposed full year 2023 dividend of 16.3¢,
4% higher than full year 2022 dividend of 15.7¢,
in line with our progressive dividend policy.
• Completed the two $125 million share
buybacks announced in December 2022
and March 2023.
• Completed the acquisition of Varagon,
which we expect to be meaningfully
accretive to earnings in the first full year
following completion.
Increased the size of our revolving credit facility
to $800 million to reflect the growth of our
business since the previous facility was put
in place in 2019. We plan to link the facility to
ESG-based KPIs in 2024.
•
• Continue to have a strong, liquid balance sheet
with $555 million of net financial assets2.
Objectives for 2024
• Assess organic capital deployment or
potential acquisition opportunities alongside
capital returns.
• Maintain focus on balance sheet flexibility
and efficiency.
1 Relative net flows are defined in the Glossary, with further
details included as part of our financial KPIs on page 20.
2 Man Group’s alternative performance measures are outlined
on pages 175 to 179.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 16
Chief Executive Officer’s review
Relative investment performance
+1.6%
2022: +1.4%
Relative net flows
+4.9%
2022: +5.3%
Statutory profit before tax
$279m
-63%
2022: $745m
Core profit before tax1
$340m
-56%
2022: $779m
1 Man Group’s alternative performance measures are
outlined on pages 175 to 189.
We have one single role,
which is to deliver investment
performance in order to help
provide greater financial
security to millions of people
around the world. My vision
is for Man Group to be
indispensable in our clients’
quest to achieve this.
Robyn Grew | Chief Executive Officer
Man Group plc
| Annual Report 2023
Strategic report 17
Overview of the year
2023 was quite a year; one that I will
remember for many reasons. Not only
did I have the honour of taking over
from Luke Ellis as CEO of Man Group in
September, but the year defied expectations
on multiple occasions as the world grappled
with several macroeconomic and geopolitical
pressures. Measures of inflation may have
retreated in the year, but the level and future
path of interest rates were firmly on investors’
minds. A shockwave rippled through financial
markets in March with the collapse of Silicon
Valley Bank (SVB), triggered by the sudden
rate rises from central banks to combat
inflation. This effect was short-lived, however,
and despite tensions in the Middle East,
concerns over China’s economic recovery,
a US credit downgrade and debt-ceiling
debate, risk assets powered ahead with
growing confidence that US policymakers
would achieve an economic soft landing in
2024; this was evidenced by the S&P 500
index gaining 24% during the year, with the
‘Magnificent Seven’ technology darlings
leading the charge.
Against that backdrop, and in my first
financial update as CEO after taking over
from Luke, I am pleased to be able to report
a solid set of results for 2023. They highlight
the continued demand for our strategies and
solutions, the breadth and depth of our client
relationships, the benefits of a diversified
product offering, and the scale and quality
of the business we have built.
As a diversified, active investor we ended the
year with positive investment performance of
$9.7 billion. Overall investment performance
for our absolute return strategies was 0.9%,
with particularly strong returns from our
discretionary strategy GLG Alpha Select
(+10.2%). Our total return and long-only
strategies performed well over the period,
helped by positive momentum in equity
markets, delivering overall investment
performance of 7.6% and 16.8%, respectively.
AHL TargetRisk gained 14.1%, once again
proving its ability to navigate hard-to-forecast
macro changes and adapt quickly to evolving
market conditions.
There were nevertheless some strategies that
were less suited to generating returns in this
environment. Notably, 2023 proved to be
a testing year for trend-following absolute
return strategies and this was for two
reasons. First, March’s SVB crisis was an
idiosyncratic event that reversed prevailing
trends. Second, the market narrative centred
around when central banks would end their
hiking cycle and whether cuts would be
imminent, which changed abruptly in
November. In that context, performance in
our flagship trend-following strategies has
Man Group plc | Annual Report 2023
been reasonable, with AHL Alpha (+1.0%) and
AHL Evolution (+3.7%), ending the period
in positive territory.
On an asset-weighted basis, relative
investment performance across the firm was
positive during the year. Our sophisticated
approach to risk management and
technology-empowered platform meant we
were able to navigate periods of market
volatility effectively, driving outperformance of
0.8% from our alternative strategies. Our
long-only strategies also outperformed by
2.8%, which is a real testament to the skill of
our investment teams.
I am delighted that we continued to attract
capital and grow our market share during the
year. In what was a difficult period for most of
the sector, the client-led growth in our
business remained strong. We recorded $3.0
billion of net inflows, across both alternative
and long-only strategies, which highlights the
continuing broad-based demand for the range
of differentiated investment strategies and
solutions that we offer at Man Group. On a
relative basis, total net inflows were 4.9%
ahead of the industry, reflecting the merits of
our client-centric distribution model and the
quality of our longstanding relationships with
allocators around the world.
Strong investment performance, net inflows
and positive impacts from foreign exchange
(FX) and other movements, resulted in
our AUM increasing to $167.5 billion as
of 31 December 2023. This marks a new
high for Man Group and a 17% increase
compared with 31 December 2022.
Despite these many positive elements,
core profit before tax decreased by 56%
compared with 2022 to $340 million, largely
driven by a decline from the exceptionally
strong performance fee outcome recorded in
the previous year. Statutory profit before tax
was $279 million, compared with $745 million
in 2022.
Strategy update
Following my appointment, I have spent a
significant amount of time with the Board
and my new Executive Committee, who
are all highly talented experts in their fields
and represent core functions from across the
firm. We have worked together to define our
strategy and outline areas of focus to deliver
the next chapter of growth for Man Group. In
doing so, I have been conscious not to
overlook our strengths today. We have built a
high-quality, resilient business that has
delivered exceptional growth. Our investment
capabilities, powered by our advanced
technology platform, are already helping to
solve our clients’ most complex problems;
continuing to invest in these strengths will
remain a key priority in the future.
I am proud of the progress we have made
diversifying our business, however, we cannot
rest on our laurels. To maintain our relevance
with clients, and to continue to deliver for our
shareholders, there are several areas that we
will be focusing on.
One of these is adding to our investment
capabilities, which is critical to our success.
We see the largest opportunities in quantitative
equities, across mid-frequency and long-only,
and in credit, across liquid and private
markets. We are also prioritising building out
our solutions offering, acknowledging that
customisation and transparency are of
ever-increasing importance to sophisticated
allocators across the globe.
Our global distribution network is one of our
key differentiators and we will continue to
prioritise investment in this area. Extending
our presence in markets where we are
underweight relative to the size of the
opportunity will be an important driver of future
growth. We have identified the North American
region, the intermediated wealth channel and
the insurance client base as key priorities.
Relative and absolute investment performance1 in 2023
Relative
Absolute
Absolute return
Total return
2.1%
0.9%
0.2%
7.6%
Multi-manager solutions
-4.5%
-1.0%
Systematic long-only
Discretionary long-only
2.6%
3.2%
17.8%
14.9%
Group
1.6%
8.5%
1 See Glossary for definition.
Strategic report | Governance | Financial statements | Shareholder information 18
Chief Executive Officer’s review continued
amount of time and energy in research
and delivery, recognising that we need to
keep innovating to meet their unique and
evolving requirements.
M&A has been a core part of our strategy
for several years and we have adopted
a consciously disciplined approach to
evaluating acquisition opportunities. We seek
to assess the repeatability and track record
of the investment process, the saleability and
scalability of the product offering, the cultural
fit and ethos of the team, and the value
creation opportunity a transaction could
represent for our shareholders. Varagon was
the first opportunity we have reviewed in a
long time that met our criteria, and we were
delighted to announce that acquisition in
2023. As the private credit market continues
to grow in relevance for the world’s largest
institutions, this transaction adds a US-
focused direct lending strategy designed
to provide consistent risk-adjusted
outperformance at scale, in a highly
customisable format, to our growing credit
offering. The M&A environment around us
is changing and we will continue to maintain
the same level of rigour and discipline when
it comes to assessing opportunities, as we
have done in the past.
Our seed capital programme continues
to play a key role in supporting product
launches, and our pipeline of new ideas
remains very strong. During the year we
seeded 14 new strategies across our
business, leaving our seeding book at $595
million as at 31 December 2023, following
investments into new products developed
across the business. Over the last few years,
we have committed resources to mid-
frequency equities, a large segment of the
quant hedge fund market with significant
alpha and diversification potential. I am
excited to see that our investments in data,
execution and infrastructure, together with
35+ years of expertise and credibility in the
quant space, are continuing to bear fruit. We
intend to accelerate investments in that space
going forward.
Our quantitative heritage and data-driven
culture continues to be core to everything
we do and last year we were pleased to
announce a partnership with the Columbia
Center on Sustainable Investment (CCSI) to
conduct research addressing how climate
impact is defined and measured in fixed
income and equity portfolios. Our joint
research with the academic experts at
CCSI will aim to produce a more refined
decarbonisation framework, which will bring
greater standardisation when calculating the
climate impact of public market securities.
2023 brought a great deal of enthusiasm
about the potential for technology, and in
particular AI via the arrival of ChatGPT, to
catalyse productivity in each and every
sector. We have been using AI for many years
already and believe this new technology has
huge potential for use across our business to
help our people perform their roles even more
effectively (more on this below). Our early and
significant investment in technology has given
us a lasting competitive advantage that is not
easy to replicate. We will focus on maintaining
this lead and continue to invest in the
development of our platform, leveraging
the benefits of our scale to drive nimble and
efficient execution of our strategic objectives.
We will also ensure that we align our
resources with our strategic goals and the
new structure of our discretionary offering
reflects a first step towards that commitment.
It is vital that we continue to evolve to meet
the needs of investors around the world and
the millions of pensioners and savers they
represent. I have every confidence in the
talent of the people here at Man Group and
our ability to build a business that is run for
long-term success and a market leader in
active management.
Progress against strategic priorities
Strong client relationships
I have spent a great deal of time with clients
in recent months and it is evident that their
challenges are becoming more complex,
requiring specific customisation and
partnership. Our breadth of investment
strategies, quality of institutional resources and
commitment to partnering with clients to build
solutions at scale are key differentiators and
have helped us to add a significant number of
new relationships with strategically important
allocators during the year. As at 31 December
2023, over 65% of our AUM is from mandates
that are customised to some degree.
As previously mentioned, we saw strong
engagement with existing and new clients
across the globe in 2023, reflected by net
inflows for the year of 2.1%; this is notably
strong relative to the industry, which saw
average outflows of roughly 3% across
comparable strategies in the year and is one of
the best signs of the strength of our business
today. Our clients have confidence in our ability
to manage and grow their assets, and to help
them to navigate a range of market conditions.
The trend of clients investing across the firm
continues, with a number of existing clients
investing in new products in 2023. At the end
of December, 73% of our AUM is from clients
investing in two products or more and 46%
from clients investing in four products or
more. Our 50 largest clients are invested in an
average of four of our strategies. This illustrates
the strength of our offering and the value we
bring in deeply understanding the evolving
needs of our clients.
Earlier this year, we also announced a strategic
partnership with Fideuram – Intesa Sanpaolo
Private Banking (F-ISPB), one of our key clients
in Italy. The new venture is focused on building
a diverse range of alternative and long-only
investment strategies and solutions, combining
our own capabilities with F-ISPB’s private
banking expertise, financial adviser network
and client base in Europe. We have grown
successfully in the intermediated retail channel
through partnerships in the US and Japan,
and we hope this venture will likewise help
to grow our presence in the Italian market.
Innovative investment strategies
We consider innovation as key to generating
alpha, cementing our competitive advantage
and creating multiple dimensions for future
growth. It strengthens our business by further
diversifying our revenue streams, providing
development opportunities for our people
and, most importantly, maintaining our
relevance with clients. We invest a huge
Man Group plc | Annual Report 2023
Strategic report 19
employees feel that they belong takes time
and effort every single day. While there is a
huge amount of work still to be done to make
our firm truly representative of the populations
we serve, we stand for an absolute and
unequivocal commitment to inclusiveness.
Conclusion and outlook
It would be remiss of me not to mention
Luke’s significant contribution to the results
that we have recorded for 2023. He has
handed over a business that is in great shape
and which will allow us to continue on our
exciting growth trajectory.
Man Group has existed for well over 200
years and has achieved this by innovating
and evolving to best serve the needs of its
clients. Today, we are a diversified, active
asset manager with significant skill in liquid
alternatives, systematic and long-only
investing, and private credit, all underpinned
by our technology.
Economic trends, geopolitical dynamics,
inflation and their interplay on the global stage
persist in their unpredictability, continuing to
create challenges in both public and private
markets. In this environment it is crucial
for managers to be forward thinking and
adaptable. Investors have never needed
diversifying sources of risk-adjusted returns
and long-term strategic partners as much
as they do now. The ability to build such
partnerships and deliver scalable alpha
through customised solutions is one of
the most exciting challenges ahead for our
industry. That’s where we see the opportunity
for Man Group over the next five years.
We intend to support our clients for many
generations to come as we have one single
role, which is to help our clients provide
greater financial security to millions of people
around the world. My vision is for Man Group
to be indispensable in our clients’ quest to
achieve this. This means that we are always
striving to be the best we can be, and I have
great confidence in our ability to deliver on
this to the benefit of both our clients and
our shareholders.
Robyn Grew
Chief Executive Officer
Net inflows
$20.3bn
over five years (2019 to 2023)
Man Institutional Solutions AUM
$16.2bn
at 31 December 2023
Women in senior management
31%
at 31 December 2023
research, portfolio construction, and trading.
During the year, our dedicated AI team,
engineers and domain experts launched an
in-house GenAI portal, ManGPT, which has
led to significant usage of GenAI as a
productivity aid across the firm in a safe and
scalable manner. We see technology more
broadly, and AI specifically, as a core
competence with major potential to increase
productivity and deliver significant operating
leverage for our shareholders.
In 2023, we were proud to sign a multi-year
open-source technology development and
product integration agreement for our
database product, ArcticDB. This was a strong
external endorsement of the quality of our
technology and we are excited to leverage our
technology expertise to help advance the
asset management industry’s operational
architecture.
Quants and technologists
People and culture
675+
at 31 December 2023
This is a great example of the academic
rigour we apply at Man Group, and how we
work collaboratively to understand complex
topics in order to add value for our clients.
Efficient and effective operations
We are a global leader in quantitative investing,
and yet the use of technology in our business
goes well beyond that. Technologists and
quants make up nearly half of our workforce
– from data science and trading to risk
management and operations. It really is core
to how we run our firm and enables us to
respond quickly as financial markets and
our clients’ needs do. Our single operating
platform means we can generate alpha at
scale and deliver portfolio solutions efficiently
to the world’s largest institutional investors. It
affords us the ability to execute larger volumes,
trade a huge number of markets and trade
at all times of the day, and it also offers the
ability to onboard new teams and businesses
efficiently. We believe our technology is
a commercial differentiator and in 2023,
we invested roughly $120 million into our
investment and core technology to maintain
our lead.
As I mentioned earlier, advances in AI seized
the spotlight in 2023. AI enables us not only to
automate, but also to innovate, and gives us
the power to grow revenue more productively.
We first used machine learning techniques
roughly ten years ago and today we employ
AI as part of our investment process in data,
Man Group plc | Annual Report 2023
Talent is, and will always be, key to the
ongoing success of our business. To best
serve our clients and shareholders, one of our
top priorities is to attract and retain the best
people, creating an environment in which
they can achieve their full potential. Man
Group is a collegiate and collaborative firm
with a real sense of community, and I am
proud of the culture that we have built,
particularly over the last decade. We place
great importance on being an employer of
choice, and we are pleased to report that our
2023 staff survey recorded a strong
engagement score of 81% when it was
conducted in the autumn.
I believe diversity is a commercial
differentiator in that diversity of thought
makes us better. We encourage, embrace,
and seek out difference in all areas. There is
no particular ‘type’ of person that joins Man
Group, and we put real effort behind
attracting diverse candidates and creating an
inclusive culture to deliver the best possible
outcomes for our clients. Our people foster
and uphold that standard and it is part of the
DNA of our organisation. We continue to work
hard to expand what we do to improve
diversity, equity and inclusion, both at Man
Group and across the industry. During 2023,
we have made a concerted effort to take our
programmes into new avenues and introduce
tangible initiatives across more fronts. You
can read more about these initiatives in the
People and culture section on page 38.
To be at the forefront of the industry for
years to come, we – and our peers – need
to reconfigure the pieces that make up
our teams, not just add individuals who
fit an existing mould. Fostering a working
environment and culture where all our
Strategic report | Governance | Financial statements | Shareholder information 20
Key performance indicators
Measuring our success
Our financial KPIs illustrate and measure the relationship between
the investment experience of our clients, our financial performance
and the creation of shareholder value over time.
Relative investment performance
R
Relative net flows
R
2023
2022
2021
1.6%
1.4%
1.9%
Why it matters
2023
2022
2021
4.9%
5.3%
9.8%
The asset-weighted performance of Man Group’s strategies in
comparison with peers gives an indication of the competitiveness of
our investment performance compared with similar strategies offered
by other investment managers.
Relative net flows are a measure of our ability to attract and retain
investor capital in comparison with our industry peers. Growth in the
assets we manage for clients drives our financial performance via our
ability to earn management and performance fees.
How we performed
Asset-weighted relative investment outperformance of 1.6% in 2023
was driven by our long-only strategies. For further information on
investment performance, see page 17.
Relative net flows in 2023 were 4.9%, reflecting the quality of our
longstanding relationships with allocators around the world and the
relevance of our investment strategies and solutions.
Core management fee EPS (diluted) growth1
Core EPS (diluted)1
R
2023
2022
2021
0%
17.0%
52.0%
Why it matters
2023
2022
2021
22.4¢
48.7
38.7
Core management fee EPS (diluted) growth in the year measures
the overall effectiveness of our business model and reflects the
value generation for shareholders from our earnings, excluding
performance fees.
Core EPS (diluted) is a measure of the earnings that drive our cash
flows. This metric includes core performance fee profits, which are
generated through outperformance for our clients and a significant
component of value creation for shareholders over time.
How we performed
Core management fee EPS (diluted) of 18.4¢ was in line with 2022,
as higher core net management fee revenue was offset by an increase
in fixed cash costs to support future growth.
Core EPS (diluted) has decreased by 54% to 22.4¢, reflecting a
reduction in performance fee profits following the exceptionally strong
outcome in 2022.
Man Group plc | Annual Report 2023
Strategic report 21
R Link to Executive Director Remuneration
Our non-financial KPIs reflect our core values and demonstrate our
commitment to our people, our communities and the environment.
Carbon footprint (tCO2e)
R
Employee engagement
2023
2022
2021
6,554
4,349
1,494
Why it matters
2023
2022
2021
81%
82%
81%
In order to monitor our carbon footprint, we measure total market-
based greenhouse gas emissions (tCO2e) using the GHG Protocol
guidance for the Scope 1, Scope 2, Scope 3 travel and Scope 3
upstream leased asset categories.
Each year, we conduct a staff survey to help us monitor and
understand employee engagement and identify any areas for action.
Alongside our engagement survey, we continue to provide various
mechanisms for staff to provide feedback.
How we performed
Total carbon emissions increased by 51% in 2023, owing to an
increase in business travel (including more long-haul travel) which
reflected our acquisitions and growth and indicated a partial return to
pre-COVID travel levels. We are focused on reducing emissions and
continue to source offsets so we retain our carbon neutral stance.
Further details can be found on pages 48 to 51.
Our 2023 staff survey recorded an engagement score of 81%,
with a response rate of 85% (a 9% increase compared with 2022).
More information on how we implement employee feedback and
support our staff can be found on page 38.
Women in senior management roles
R
ESG-integrated AUM ($bn)
R
2023
2022
2021
31%
26%
27%
Why it matters
2023
2022
2021
59.3
50.0
55.2
As part of our efforts to encourage greater diversity across the
investment management industry, we measure the number of women
in senior management positions at the firm. This is defined as those
who are, or report directly to, members of our Executive Committee.
Our goal is to meet the RI needs of our clients and this can be
measured by the amount of our AUM that is invested sustainably.
We calculate ESG-integrated AUM in line with the Global Sustainable
Investment Alliance definition, which has emerged as the global
standard of classification. Further details on this metric can be found
on page 54.
How we performed
In 2023, the number of women in senior management roles increased
to 31%, exceeding our 2024 target of 30%. Further information on our
initiatives to develop a diversified talent pool can be found on pages
40 and 41.
ESG-integrated AUM has increased to $59.3 billion in 2023, as we
have continued to respond to client demand and expand our range of
ESG-oriented strategies. Market beta and currency moves have also
contributed positively to the increase.
1 Details of the calculation of our alternative performance measures are provided
on pages 175 to 179.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 22
Chief Financial Officer’s review
Core management fee EPS (diluted)
18.4¢
2022: 18.4¢
Core EPS (diluted)
22.4¢
-54%
2022: 48.7¢
Statutory profit
$234m
-62%
2022: $608m
Capital returns to shareholders
in 2023
$0.3bn
2023 illustrates the resilience
of our business. Our
management fee profitability
remained stable. Despite the
challenging environment, we
continued to see net inflows,
achieving record AUM of
$167.5 billion following the
acquisition of Varagon.
Antoine Forterre | Chief Financial Officer
Man Group plc
| Annual Report 2023
Strategic report 23
Year ended
31 December
2023
963
180
48
5
1,196
(58)
(595)
(179)
(21)
(2)
(1)
340
Year ended
31 December
2022
927
779
(15)
5
1,696
(58)
(678)
(170)
(11)
–
–
779
280
60
271
(61)
234
19.4¢
22.4¢
18.4¢
16.3¢
290
489
647
(34)
608
45.8¢
48.7¢
18.4¢
15.7¢
$m
Core net management fee revenue
Core performance fees
Core gains/(losses) on investments
Core rental income
Core net revenue
Asset servicing costs
Compensation costs
Core other costs
Net finance expense
Rollover share of post-tax profits
Third-party share of post-tax profits
Core profit before tax
Core management fee profit before tax
Core performance fee profit before tax
Core profit
Non-core items (before tax)
Statutory profit
Statutory EPS (diluted)
Core EPS (diluted)
Core management fee EPS (diluted)
Proposed dividend per share
Core metrics
Core metrics are each alternative performance measures (APMs) and exclude the impact
of fund consolidation, acquisition and disposal-related items, significant non-recurring
items and volatile or uncontrollable items, as well as profits or losses generated outside
of our investment management business. These core metrics reflect the way in which
performance is monitored by the Board and present the profits or losses which drive our
cash flows and inform the way in which our variable compensation is assessed. Note that
our APMs may not be directly comparable with similarly titled measures used by other
companies. Further details on our APMs, including reconciliations between statutory
measures and their core equivalents, are set out on pages 175 to 179.
weighted towards the end of the year. Run
rate core net management fee revenue was
$1,087 million at the end of the year, up from
$917 million at the end of 2022, largely as a
result of the revenue earned on Varagon AUM.
Performance fee generation was lower, with
$178 million earned in the year on a statutory
basis following the record $778 million
earned in 2022. Our asset-weighted relative
investment outperformance was 1.6% across
all categories compared with 1.4% in 2022.
All our investment engines generated
performance fees in the year. Core gains on
investments of $48 million, compared with
losses of $15 million in 2022, were generated
by mark-to-market gains across our seed
book. Core costs were $835 million,
down from $906 million in 2022, driven
by lower performance fee-related variable
compensation partially offset by higher
fixed compensation costs due to increased
headcount following the acquisition of Varagon
and continued investment in the business. The
impact of the strengthening of sterling against
the US dollar in the year also contributed to an
increase in other costs.
Our core rental income in 2023 was in line with
2022. In 2023, we signed sub-leases with two
new tenants for a substantial portion of the
vacant space in Riverbank House and our
existing sub-tenant signed agreements to
extend their current leases until the end of the
head lease. In early 2024, we also signed
Heads of Terms with one of our sub-tenants
for additional space in the building.
Non-core items (excluding tax) increased
from a net expense of $34 million in 2022
to $61 million in 2023, primarily due to FX
losses of $11 million compared with gains
of $22 million in 2022. Gains on disposal of
right-of-use lease assets and a decrease in
the amortisation of our acquired intangible
assets, due to some becoming fully
amortised in 2022, were partially offset by
costs relating to the acquisitions of Varagon
and Asteria. Non-core items also include
adjustments to the statutory income
statement charge relating to amounts payable
to the Varagon sellers who remain members
of senior management post-acquisition in
order to adjust the expense recognised in
the year to reflect the corresponding profits
generated. Together with acquisition-related
costs, these items added $30 million to our
non-core expense.
Overview
Man Group ended the year with record AUM
of $167.5 billion, driven by continuing positive
net flows, strong investment performance in
our long-only strategies and the acquisition
of Varagon. Statutory profit decreased to
$234 million from $608 million in 2022,
primarily due to a decrease in performance
fees following exceptional performance fee
generation in 2022. The heightened volatility
following the US bank turmoil in March and
continued political, economic and monetary
uncertainty led to muted performance for our
systematic macro strategies, the key drivers
of our performance fees. We continued to
grow our core net management fee revenue,
largely through the Varagon acquisition,
standing at $963 million for the year
compared with $927 million in 2022. Core
diluted management fee EPS of 18.4¢ was
in line with 2022 due to an increase in fixed
compensation and core other costs offsetting
the increase in core net management fee
revenue. The decrease in profit in the year led
to statutory EPS on a diluted basis decreasing
to 19.4¢ from 45.8¢ in 2022, with core diluted
EPS decreasing from 48.7¢ to 22.4¢.
Closing AUM of $167.5 billion at 31 December
2023, up from $143.3 billion at the end of
2022, was driven by net inflows of $3.0 billion
in the year, positive absolute investment
performance of $9.7 billion and FX and other
movements of $11.5 billion, including $10.8
billion contributed by Varagon. Performance
was positive across all categories, and we
saw net inflows of $4.9 billion across absolute
return, total return and discretionary long-
only, partially offset by net outflows of $1.0
billion and $0.9 billion in multi-manager
solutions and systematic long-only
respectively.
We completed the acquisition of
controlling interests in Varagon and Asteria
in the second half of the year. Varagon’s
private credit capabilities diversify our offering
to investors, representing the potential for
significant value creation. The growth in our
strategic partnership with Fideuram through
the acquisition of Asteria enables us to
increase our offering across Europe in the
intermediated wealth channel. Additionally,
we have continued to grow our CLO business
and securitised new vehicles in Europe and
the US in the year.
Management and other fees on a statutory
basis increased by 4% to $990 million
for the year as a result of higher average
AUM, with Varagon contributing $29 million
post-acquisition. The average net management
fee margin of 63 basis points for the year was 2
basis points lower than in 2022 due to
AUM mix shift towards long-only lower margin
strategies, partially offset by the acquisition
of Varagon.
The run rate net management fee margin at
31 December 2023 stood at 65 basis points
compared with 64 basis points at the end of
2022, with inflows into higher margin strategies
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 24
Chief Financial Officer’s review continued
We continue to deliver strong cash conversion of our profits and
continued our returns to shareholders in 2023 through completion
of the two share repurchases, each of $125 million, announced in
December 2022 and March 2023 respectively. Our total proposed
dividend for the year of 16.3¢ per share represents an increase of
4% from 15.7¢ in 2022, in line with our progressive dividend policy.
The total announced returns to shareholders for 2023 is over
$0.3 billion, and $1.8 billion over the last five years.
Our balance sheet remains strong and liquid and allows us to navigate
periods of stress while continuing to invest in the business to support
our long-term growth prospects. Alongside the deployment of our
capital to fund acquisitions and strategic partnerships, we continue
to return excess capital to shareholders, allocate capital to seed
investments and heavily invest in technology to ensure we remain
leaders in active investment management. We had net tangible assets
Assets under management
of $782 million at 31 December 2023 and net financial assets of $555
million, including $180 million of cash (excluding amounts held by
consolidated fund entities) and net of $35 million of acquisition-related
liabilities which begin to crystallise in 2028. We continue to be strongly
cash-generative, with core cash flows from operations excluding
working capital movements of $362 million in the year.
Impact of foreign exchange rates
The portion of our AUM which is denominated in currencies other
than the US dollar was positively impacted by the weakening of the
US dollar against most currencies over the course of the year. This
increased our reported AUM by $1.4 billion and had a positive impact
on our core net management fee revenue. However, the strengthening
of sterling against the US dollar also contributed to a partially offsetting
increase in core costs of around $2 million compared with 2022.
$bn
Alternative
Long-only
Total
Absolute return
Total return
Multi-manager solutions
Total
Systematic
Discretionary
Total
31 December
2022
46.0
28.8
20.2
95.0
31.6
16.7
48.3
143.3
Net inflows/
(outflows)
2.3
1.1
(1.0)
2.4
(0.9)
1.5
0.6
3.0
Investment
performance
0.2
1.1
0.5
1.8
5.4
2.5
7.9
9.7
FX and other
(0.8)
11.5
(0.3)
10.4
0.4
0.7
1.1
11.5
31 December
2023
47.7
42.5
19.4
109.6
36.5
21.4
57.9
167.5
Change
%
4
48
(4)
15
16
28
20
17
$bn
1.7
13.7
(0.8)
14.6
4.9
4.7
9.6
24.2
Alternative AUM ($bn)
Alternative AUM ($bn)
95.0
2.4
1.8
10.4
109.6
2022
Net inflows
Investment
performance
FX and other
2023
Long-only AUM ($bn)
Long-only AUM ($bn)
48.3
0.6
7.9
1.1
57.9
2022
Net inflows
Investment
performance
FX and other
2023
Man Group plc | Annual Report 2023
Absolute return
The increase in absolute return AUM was driven by net inflows of
$2.3 billion, primarily into Man Institutional Solutions and AHL Alpha,
partially offset by outflows from GLG Event Driven. Positive absolute
performance of $0.2 billion was driven by a number of strategies in the
product category, in particular AHL Evolution and GLG UK Select,
partially offset by negative performance in American Beacon
AHL Managed Futures.
Total return
Total return AUM increased by $13.7 billion, driven by the Varagon
acquisition which added $10.8 billion to the category. Net inflows of
$1.1 billion were primarily into Alternative Risk Premia and the launch
of new CLOs. Positive absolute performance of $1.1 billion was
primarily due to gains in AHL TargetRisk, reflecting its long-only
exposure to fixed income and equity markets.
Multi-manager solutions
The decrease in multi-manager solutions AUM was primarily driven
by net outflows of $1.0 billion, partially offset by positive absolute
performance of $0.5 billion, largely from infrastructure mandates.
Systematic long-only
Systematic long-only AUM increased by $4.9 billion, driven by positive
absolute performance of $5.4 billion across all strategies in the
product category.
Discretionary long-only
Discretionary long-only AUM increased by $4.7 billion. Net inflows
of $1.5 billion were primarily into our credit strategies GLG Sterling
Corporate Bond, GLG High Yield and GLG Global Investment Grade
Opportunities. Positive performance of $2.5 billion was driven by a
number of strategies, reflecting exposure to a broad range of markets.
Strategic report 25
Revenue
Growth in management fee revenue was offset by lower performance fee generation, leading to a decrease in statutory net revenue from
$1,727 million in 2022 to $1,194 million in 2023. Core net revenue similarly decreased from $1,696 million to $1,196 million.
Absolute return
Total return
Multi-manager solutions
Systematic long-only
Discretionary long-only
Other service income1
Total
Core net
management fees
Year ended
31 December
2023
526
208
34
81
110
4
963
($m)
Year ended
31 December
2022
515
201
34
75
102
–
927
Net management fee
margin
(bps)
Year ended
31 December
2022
112
63
20
25
57
n/a
65
Year ended
31 December
2023
112
64
17
24
59
n/a
63
Run rate
core net management fees
Run rate
net management fee margin
Year ended
31 December
2023
544
294
33
91
125
n/a
1,087
($m)
Year ended
31 December
2022
526
177
38
77
99
n/a
917
Year ended
31 December
2023
114
69
17
25
58
n/a
65
(bps)
Year ended
31 December
2022
114
61
19
24
59
n/a
64
1 Other service income included in core net management fees is earned on an absolute basis rather than as a margin on AUM.
Core management fee profit before tax ($m)
Core management fee profit before tax ($m)
36
(3)
(43)
290
280
2022
Increase in
net revenues
Increase
in variable
compensation
Increase in
fixed costs
and other
2023
Performance fees and investment gains and losses
Core performance fees for the year were $180 million (2022:
$779 million), including $163 million from alternative strategies
(2022: $761 million) and $17 million from long-only strategies
(2022: $18 million). We have strong performance fee optionality
and diversity, with a broad range of strategies having contributed
to our performance fee earnings in recent years. More than 50 of
our strategies are performance fee-eligible.
Core gains on investments of $48 million (2022: losses of $15 million)
were generated by mark-to-market gains across our seed book,
including $17 million from our CLO holdings.
Rental income
Core rental income was broadly flat year-on-year. The sub-leases
we signed in 2023 for a substantial portion of the vacant space in
our London office and the extension of leases with one of our existing
sub-tenants reduce future rental income, depreciation and occupancy
costs. Following the derecognition of the associated portion of
our right-of-use lease assets we recognised a gain on disposal of
$12 million, classified as a non-core item.
Management fees
Core net management fee revenue increased by 4% to $963 million
in 2023 (2022: $927 million), driven by higher average AUM and the
acquisition of Varagon. Net management fee margin decreased from
65 basis points in 2022 to 63 basis points in 2023, driven by higher
average AUM in low margin multi-manager solutions and systematic
long-only strategies following strong net inflows in the second half of
2022. This was partially offset by the addition of Varagon, which
attracts a higher margin, and an increase in average AUM from
positive investment performance in absolute return strategies.
The absolute return net management fee margin remained at 112
basis points, as the mix shift towards higher margin Man Institutional
Solutions mandates was offset by a decrease in average AUM in
higher margin AHL Diversified. The total return net management
fee margin increased by 1 basis point to 64 basis points, as the
addition of higher margin Varagon AUM was partially offset by
higher average AUM in lower margin AHL TargetRisk. The multi-
manager solutions net management fee margin decreased to
17 basis points in 2023 from 20 basis points in 2022 as a result of
the ongoing shift towards infrastructure solutions from traditional
fund of funds. The net management fee margin of systematic
long-only strategies decreased from 25 basis points to 24 basis
points due to margin pressure and mix effects at the product
level in recent years. Discretionary long-only margins increased
from 57 basis points in 2022 to 59 basis points in 2023 due to
strong performance in higher margin GLG Japan CoreAlpha.
Run rate core net management fee revenue was $1,087 million at
31 December 2023 (2022: $917 million). The increase in the year was
largely as a result of the acquisition of Varagon and the increase in
AUM in absolute return, total return and long-only strategies.
The run rate net management fee margin at 31 December 2023
was 65 basis points compared with 64 basis points at 31 December
2022, largely as a result of the acquisition of Varagon in the second
half of the year positively contributing to the run rate margin at
31 December 2023 when compared with the margin in the year.
Other movements in the run rate margin for individual strategies were
broadly driven by the same factors as those impacting actual margins
in the year.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 26
Chief Financial Officer’s review continued
Costs
Asset servicing
Asset servicing costs vary, predominantly depending on transaction
volumes, the number and mix of funds, and fund NAVs. Asset
servicing costs were $58 million (2022: $58 million), which equated
to around 5 (2022: 5) basis points of average AUM1.
Compensation costs
Core compensation costs were $595 million for the year, down
by 12% from $678 million in 2022 due to lower performance fees
decreasing the associated variable compensation. Our compensation
ratio is between 40% and 50% of core net revenue, depending
on the mix and level of revenue. We expect to be at the higher
end of the range in years when performance fees are low or driven
predominantly by discretionary strategies. Conversely, we expect to
be at the lower end of the range when performance fees are high
or driven by systematic strategies. The overall compensation ratio
increased to 50% in 2023 from 40% in 2022, reflecting the decrease in
performance fee revenue generated in the year.
Other costs
Core other costs, which exclude acquisition-related costs and
amounts incurred by consolidated fund entities, increased to
$179 million in 2023 from $170 million in 2022, primarily as a result
of an increase in staff benefit costs. The strengthening of sterling
against the US dollar also contributed to the increase as the majority
of our cost base is denominated in sterling.
Core earnings per share (diluted) (¢)
Core earnings per share (diluted) (¢)
30.3
4.0
18.4
18.4
23.0
15.7
11.3
9.7
5.9
10.3
2019
2020
2021
2022
2023
Core management fee EPS (diluted)
Core performance fee EPS (diluted)
Tax
The majority of our profits are earned in the UK, with significant profits
also arising in the US, where our cash tax rate is effectively nil as a
result of available deferred tax assets, and in Switzerland, which
currently has a lower rate than the UK. Tax on statutory profit for
the year was $45 million (2022: $137 million). The recognition of a
significant portion of our accumulated US losses as deferred tax
assets as a result of the Varagon acquisition drove a decrease in the
statutory effective tax rate from 18% in 2022 to 16% in 2023. This
mitigated the increase in the UK statutory tax rate from 19% to 25%
on 1 April 2023. This increase in the UK tax rate led to an increase in
the core tax rate from 17% in 2022 to 20% in 2023.
1 Excludes systematic long-only and private markets strategies.
Man Group plc | Annual Report 2023
In the US, we have accumulated tax losses and tax-deductible
goodwill and intangibles of $89 million (2022: $82 million) which can
be offset against future US profits, thereby reducing taxable profits.
We have recognised $86 million of the available $89 million US
deferred tax assets at 31 December 2023 (2022: $64 million and
$82 million respectively) as the portion of state and city tax losses
expected to expire before utilisation has reduced following the
Varagon acquisition. The US core tax rate will remain at nil until cash
taxes are payable in the US, with movements in the deferred tax asset
classified as a non-core item. We do not currently expect to pay
federal tax on any profits we may earn in the US until 2026.
The principal factors influencing our future underlying tax rate are
the mix of profits by tax jurisdiction, the rate of consumption of US
deferred tax assets and changes to applicable statutory tax rates.
The global minimum tax rate due to come into effect in 2024 is not
expected to result in significant top-up taxes becoming due.
Profit
Statutory profit decreased from $608 million in 2022 to $234 million in
2023, with core profit decreasing from $647 million to $271 million
over the same period. The decrease in profitability led to a decrease in
statutory EPS (diluted) from 45.8¢ in 2022 to 19.4¢ in 2023 (48.7¢ and
22.4¢ respectively on a core basis), with the reduction partially offset
by a decrease in share count as a result of the $223 million of shares
repurchased during the year.
Cash earnings
Due to our strong conversion of profits into cash, we believe that core
profit is a good measure of our cash flow generation, although the
timing of cash conversion is impacted by the cyclical movements in
our working capital position and the size of our seed book. Core cash
flows from operations excluding working capital movements were
$362 million for the year.
As at 31 December 2023, our cash balance, excluding amounts held
by consolidated fund entities, was $180 million.
$m
Opening available cash and cash equivalents
Core cash flows from operations excluding
working capital movements
Working capital movements (excluding seeding)
Working capital movements – seeding
Acquisition of subsidiaries, net of cash acquired
Dividends paid
Share repurchases (including costs)
Drawdown of revolving credit facility
Other movements
Closing available cash and cash
equivalents
Year ended
31 December
2023
349
Year ended
31 December
2022
323
362
(132)
119
(170)
(181)
(223)
140
(84)
180
810
(65)
(52)
–
(179)
(386)
–
(102)
349
Strategic report 27
Balance sheet
We have a strong and liquid balance sheet. The acquisitions of
Varagon and Asteria in the year, together with the decrease in
performance fee revenues net of variable compensation costs,
resulted in a decrease in available cash and cash equivalents net
of borrowings.
$m
Available cash and cash equivalents
Seeding investments portfolio
Borrowings
Contingent consideration payable
Put option over non-controlling interests
Put option over rollover interests
Payables under repo arrangements
Net financial assets
Other tangible assets and liabilities
Net tangible assets
Goodwill and intangibles
Shareholders’ equity
31 December
2023
180
595
(140)
(3)
(9)
(23)
(45)
555
227
782
830
1,612
31 December
2022
349
688
–
–
–
–
(54)
983
39
1,022
677
1,699
Seed investments
We use our balance sheet to invest in new products, aiming to redeem
as client AUM in the funds grows. At 31 December 2023, our seed
investments were $595 million, a decrease from $688 million at
31 December 2022. $45 million were financed via repos (2022:
$54 million). In addition, we held $230 million of total return swap
exposure at 31 December 2023 (2022: $138 million), allowing us to
maintain our seed portfolio exposure without tying up large portions
of our cash balances.
The statutory consolidation of a number of our CLOs results in a
significant gross-up of assets and liabilities in the Group balance
sheet. Our maximum exposure to loss associated with interests in
our CLOs is limited to the investment in these CLOs, as reflected in
the seeding investments portfolio balance, which excludes the impact
of this gross-up.
Capital management and shareholder returns
Shareholder returns
Shareholder returns
1,510
1,454
100
147
100
153
1,402
350
1,288
250
1,178
125
189
187
188
2019
2020
2021
2022
2023
Dividends ($m)*
Buybacks ($m)
Weighted average basic number
of shares (millions)
* Amounts shown are on a paid basis except for the final 2023 dividend,
which is on an announced basis.
Our balance sheet and liquidity position remains robust, allowing us
to invest in the business, support our long-term growth prospects
and maximise shareholder value. It also enables us to withstand
periods of stress. We actively manage our capital to maximise value
to shareholders by either investing that capital to improve shareholder
returns in the future or by returning it through higher dividends or
share repurchases. In 2023, we completed the two $125 million share
repurchases announced in December 2022 and March 2023.
The Board is proposing a final dividend for 2023 of 10.7¢ per share,
which together with the interim dividend of 5.6¢ per share equates
to a total dividend for the year of 16.3¢ per share, representing an
increase of 4% on 2022. The proposed final dividend of around
$125 million is adequately covered by our available liquidity and
capital resources. Key dates relating to the proposed final dividend
are provided in the Shareholder information section.
Our business is highly cash-generative, and these cash flows support
our progressive dividend policy, under which dividends are expected
to grow over time. We ensure we maintain a prudent balance sheet at
all times by taking into account liquidity requirements before investing
capital, considering potential strategic opportunities or returning it to
shareholders. Over the past five years, we have returned $0.9 billion
to shareholders through dividends and announced $0.9 billion of
share buybacks. As a result, our weighted average share count has
decreased by 22% to 1,178 million over that same period.
Our revolving credit facility was renewed in December 2023 and
extended to $800 million. It matures in 2028, providing additional
liquidity. We have maintained prudent capital and available liquidity
throughout the year, deploying our capital to acquire a controlling
interest in Varagon and Asteria and to support investment
management operations and new investment products, utilising
the revolving credit facility when appropriate. We monitor our
capital requirements through continuous review of our regulatory
and economic capital, including regular reporting to the Risk and
Finance Committee and the Board.
Planning for the impacts of climate change
Whilst climate change has not significantly impacted our financial
performance and position to date, consideration of the potential
future impacts of climate change on our business is embedded in
our financial planning and reporting processes. As part of our ongoing
commitment to reduce our carbon footprint and to reach net zero
by 2030, we seek to minimise the carbon emissions of our office
premises, be thoughtful around inter-office travel or use lower-carbon
modes of transport where possible, and proactively plan for our
ambitions in the future. Under our strategy, we continue to embed
targets to reduce our Scope 3 carbon emissions from business travel
into our annual budgeting process. Further detail on our carbon
emissions targets can be found on page 51.
The directors do not expect potential climate-related impacts to be
material on the Group financial statements in the short to medium
term. In particular, in performing their assessment the directors have
considered the impact of climate change on our going concern and
viability, the cash flow forecasts used in the impairment assessments
of our non-current assets, and the assumptions relating to future life
expectancies used in the valuation of the net pension asset. We
continue to monitor the potential longer-term impacts of climate
change risks on the judgements and estimates used in the
preparation of the Group financial statements.
2000
1500
1000
500
0
Man Group plc | Annual Report 2023
Antoine Forterre
Chief Financial Officer
Strategic report | Governance | Financial statements | Shareholder information 28
Risk management
A robust and integrated approach
Risk management is joined up and embedded into both
the management of funds on behalf of our investors and
the management of Man Group’s business on behalf of
our shareholders.
The Board has ultimate responsibility for
risk governance and management. Our risk
management framework embeds day-to-day
accountability throughout the business to
ensure that we operate within acceptable
risk tolerances, as defined by the Board’s risk
appetite, with our governance structure and
three lines of defence providing a foundation
for continuous oversight. In addition,
independent fund boards are responsible
for protecting the interests of fund investors.
The risk governance framework
Man Group’s risk management framework
and internal control systems aim to safeguard
assets, maintain proper accounting records
and provide assurance that the financial
information used in the business and
published externally is robust and reliable.
The framework is designed to manage key
risks but cannot eliminate the risk of failure
to achieve business objectives and can
only provide reasonable assurance against
material misstatement or loss.
Whilst the Board retains overall responsibility
for Man Group’s risk management and
internal control systems, it has delegated
oversight to the Audit and Risk Committee
(ARCom) and the Executive Committee,
as summarised in the diagram below.
The risk management framework and internal
control systems, which have been in place
throughout 2023 and up until the date of this
report, comply with the Financial Reporting
Council’s (FRC’s) Guidance on Risk
Management, Internal Control and Related
Financial and Business Reporting. In addition,
the Board has conducted a specific annual
review of their effectiveness. This included a
robust assessment of Man Group’s principal
and emerging risks, significant operational risk
events, Internal Audit findings and an
assessment of any risks identified by the
business or the ARCom – all contributions
came from the relevant business function or
system, incorporating BAU challenge and
review. Following this review, the Board
concluded that Man Group’s risk management
processes were effective and that there were
no significant weaknesses or failings in the
system of internal controls.
Risk appetite
The governance framework and control
environment within Man Group have
been designed to manage corporate and
investment management risks in accordance
with a risk appetite set by the Board. The
risk appetite statements express the Board’s
appetite to each principal risk, promote a
risk-aware culture and set out objectives
and boundaries for Man Group’s business.
The primary goal of risk management is to
support the achievement of Man Group’s
objectives by encouraging an appropriate
balance between risk and benefit, in a
controlled and regulatory compliant context.
The ARCom receives regular reporting on
Man Group’s risk profile and adherence
with risk appetite and provides regular
updates to the Board. During the year, the
Board reviewed and approved the annual
refresh of Man Group’s risk governance
framework, principal risks register and risk
appetite framework. There were no material
changes to the risks and risk tolerances of
the business. However, balance sheet FX risk
was removed from the register based on
materiality following an accounting/hedging
policy change in 2022. Summary risk appetite
statements are available on our website.
The three lines of defence
The overall risk management framework at
Man Group is based on the three lines of
defence model which is overseen by the
ARCom. The framework instils the principles
of direct responsibility for risk management
in each business unit with independent
functions monitoring and challenging them.
A description of each line is provided at the
bottom of the diagram below.
The Board sets Man Group’s appetite for risk and ensures that risk management measures and internal controls are appropriate and effective.
Implementation is delegated to certain committees which provide assurance back to the Board that risk has been managed according to its appetite.
Board of Man Group plc
The ARCom is a committee of the Board that has oversight of financial reporting, risk management and the assurance functions
(see pages 88 to 95 for further detail).
Audit and Risk Committee (ARCom)
Executive Committee (ExCo)
The Executive Committee is accountable for all risks assumed in the business,
and is responsible for the execution of appropriate risk management discipline.
Risk and Finance Committees (RAF)
The committees oversee the operational and regulatory risks and the internal control environment. The committees also monitor balance
sheet financial risks and the adequacy of capital and liquidity buffers. There are three committees covering Global, UK/EEA and Rest
of World Man Group entities, and these are chaired by the CFO and the Head of Non-Financial Risk.
First Line of Defence:
Second Line of Defence:
Third Line of Defence:
External Audit
Embedded accountability with each
employee at the business and
operations level.
Monitoring and training by risk,
compliance, information security
and financial crime.
Independent review and oversight by
Internal Audit, incorporating
best practices.
Man Group plc | Annual Report 2023
Strategic report 29
positive year while the TargetRisk strategies
have seen a recovery of last year’s losses on
the back of equity performance.
indicators. Work in 2023 has focused on
business continuity and operational resilience
(see spotlight box on page 30).
The muted performance of trend-following
strategies led to core performance fees
being down 77% compared with 2022 and
68% compared with 2021, two particularly
strong years.
Geopolitical tensions and advances in AI led
to a heightened cyber threat assessment
across the industry. We did not experience
any material issues but this continues to be
an area of focus.
Supporting the development of new products
is an important way to grow and diversify
future revenues and we continue to utilise our
balance sheet to support the firm’s seeding
programme. There have been 14 new
investments in 2023 spanning Man Group’s
investment managers. The core seeding
book, net of benchmark hedges, performed
well in 2023, and we also saw a reversal of
2022 mark-to-market losses on our CLO risk
retention positions.
The UK/EEA sub-group is regulated on a
consolidated prudential basis by the FCA.
The first Internal Capital Adequacy and Risk
Assessment (ICARA) submission under the
new Investment Firms Prudential Regime
(IFPR) was as of 31 December 2022. The
updated process has not changed our
universe of principal risks and how we
manage them, nor has there been a material
change in the regulatory capital or liquidity
requirements of our sub-group. However, the
regime has brought a useful ‘harms’ focus
into our risk governance framework and
requires us to focus on the risks of five
regulated entities within the UK/EEA
sub-group as well as the consolidated
group itself.
In late 2022 we went live with a new
operational risk system, with the first phase
focused on providing powerful reporting and
analysis capabilities to the first-line risk owners
around risks, controls, events, issues and
Developments in 2023
The acquisition of Varagon, a specialist
middle-market direct lender, brought Man
Group AUM to its highest ever level. Varagon
further diversifies our product offerings, client
base and income stream, and brings the
stability of a private market investment
product. In addition to Varagon we have seen
good net inflows, growth on our long-only
range through market beta and growth in
USD-equivalent AUM due to FX moves.
Overall, AUM grew by $24.2 billion in 2023,
as described on page 24.
While our focus is on continuous innovation
and diversification of offerings, investment
underperformance of our existing products
remains the biggest risk facing Man Group.
2023 continued to display challenging and
fragile markets with ongoing high inflation and
uncertainty over the direction of interest rates.
This was against a backdrop of growing
global geopolitical risk including Russia/
Ukraine, Israel/Gaza and China/Taiwan.
The March banking crisis is a manifestation
of these fragile markets abruptly adjusting to
the higher rate environment (see spotlight
box below).
Markets in 2023 were characterised by rising
equities and falling-then-rising bonds but also
high volatility linked to the March banking
crisis, central bank activity and economic
data surprises. This was a difficult
environment for trend-following strategies and
these did not deliver the strong performance
seen in the last two years. In line with peers,
the performance has been volatile but ended
the year with marginally positive absolute
performance. Our long-only equity strategies
the majority of which outperformed their
benchmarks, also carried a beta to the
rising markets. Credit and equity alternatives
strategies have had a mixed and broadly
Spotlight: March 2023 banking crisis – counterparty and liquidity risk
In early March three US regional/specialist
banks failed over five days, with another
acquired in May to avoid a similar fate.
US regulators needed to step in to ensure
that deposits would be honoured. Later
in March Credit Suisse, faced with rapid
and unsustainable deposit withdrawals, was
bought at a material discount by UBS in a
deal brokered by the Swiss central bank.
These events highlight the fragility of
financial markets linked to the 2022
interest rate rises, bank liquidity duration
mismatches and a crypto exchange fraud.
They also underscore how rapidly banks
can fail: in sharp contrast to the bank runs in
2008, clients can transfer out their funds in
minutes and social media fuelled the panic.
In line with the Board’s risk appetite
Man Group takes a conservative approach
to counterparty selection and seeks to
minimise and diversify counterparty risk.
Man Group and its funds had no direct
counterparty exposure to any of these US
regional banks, nor were we impacted by
any third-party exposures. Following the
Credit Suisse issue with Archegos two
years earlier, Man Group decided to migrate
all prime brokerage activities to two other
banking partners over the course of
2021/22. By March 2023 we held a handful
of bespoke over-the-counter positions with
a low net default exposure, which were all
closed out or novated.
The banking crisis brought extreme volatility
to the short-dated interest rates markets.
These moves resulted in large losses for
our (and peer) trend-following funds which
had built up a large rates risk position. The
quantitative models automatically cut the
positions meaning we needed to trade out
of a significant volume. Despite this, we had
no issues accessing market liquidity during
the de-risking, albeit at wider spreads.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 30
Risk management continued
Spotlight: Business continuity and operational resilience
In recent years we have seen more
disruptive events impacting specific
industries/regions that are global in nature,
such as the pandemic, wars, cyber-attacks,
bank collapses and energy shortages.
Regulators have asked firms to assess
their operational resilience by ensuring they
expect disruptions to occur and focus on
preventing them from negatively impacting
clients, markets and the financial system.
Over the last 18 months the Operational
Risk & Resilience team have transitioned
Man’s Business Continuity (BC) framework
to a service led model which provides a
common lens through which we can bring
together the best elements of BC and
business impact analysis. The move not
only fundamentally improves our ability to
understand Man Group’s services and how
we support their recovery in response to a
crisis, but also to lay core foundations that
underpinned new operational resilience
frameworks delivered in December 2023.
of ‘Dynamic Service-Led Business
Continuity Plans’ that can be run in
seconds, utilising the most current data
to assist management during an incident
or scenario testing. This new approach
provides better understanding of key
resources that underpin the services we
deliver and enables us to address how to
respond if these resources are not available.
The BC and resilience data is held in a
customised tool that supports workflow and
visualisation of service mappings. The tool
uses golden source systems for people and
technology data and facilitates the concept
Resilience is a journey and each scenario
we manage is an opportunity to develop
and mature the firm’s response to crisis
management. We will continue to adapt our
frameworks accordingly.
Assessment of principal risks and
uncertainties
Given its wide range of investment products
and strategies, Man Group manages a
broad spectrum of business, credit, liquidity,
market, operational and reputational risks and
uncertainties, to both the firm and our funds.
Climate change risk aligns to many of these
risks but is also captured as a standalone
principal risk.
Man Group takes investment risk on behalf
of its clients in order to deliver the level of
performance they expect. Failure to deliver,
over the long term, would result in investor
redemptions and lower management and
performance fees. Declining profitability,
in turn, reduces the ability to invest in
the people and technology that deliver
investment performance.
Therefore, business risks are the biggest
risks and uncertainties to Man Group and
investment underperformance is the single
biggest principal risk. The other principal risks
are necessary exposures which enable us
to deliver performance for our clients, but we
seek to manage and minimise these wherever
possible and at proportionate expense.
Man Group’s core risk profile has not
changed materially in 2023. However,
integration risk arises from the Varagon and
the smaller Asteria transactions. Integration
workstreams are focused on aligning systems
and processes with the appropriate risk
appetite. The broader integration risks come
from failure to align cultures or not being able
to grow or develop products and services for
existing and new clients.
The directors confirm that they have carried
out a robust assessment of the principal and
emerging risks facing Man Group, including
those that would threaten its business model,
future performance, solvency or liquidity
and reputation.
We describe and assess our principal and
emerging risks and uncertainties on pages 30
to 34 and explain how they are being
managed or mitigated. The climate change
principal risk is at the end so it links back
to other principal risks and leads on to
the climate change risk management and
strategy. The risks are linked to each of
Man Group’s strategic priorities. These will be
reviewed in 2024 and aligned to the evolving
strategy introduced in the CEO Statement.
Risk
Mitigants
Status and trend
Change
Business risks
1
2
3
4
Investment
performance
and net
redemptions
Fund underperformance, on an absolute
basis, relative to a benchmark or relative to
peer groups, could reduce AUM and may
result in lower subscriptions and higher
redemptions. This risk is heightened at
times of disrupted and volatile markets,
which could be triggered by geopolitical
or climate factors. This may also result in
dissatisfied clients, negative press and
reputational damage.
Lower AUM results in lower management
fees and underperformance results in lower
performance fees.
Man Group’s investment businesses each
have clearly defined investment processes
with integrated risk management, designed
to target and deliver on the investment
mandate of each product. We focus
on hiring and retaining highly skilled
professionals who are incentivised to
deliver alpha within the parameters of
their mandate.
Man Group’s diversified range of
products and strategies, which now
includes Varagon, limits the risk to the
business from underperformance of any
particular strategy or market.
Overall performance in 2023 has
been mixed given the fragile and volatile
markets and the geopolitical backdrop:
trend-following strategies were marginally
positive; credit and equity alternatives
strategies were mixed but generally
positive; long-only equity strategies
carried a beta to rising markets and
generally outperformed their benchmarks;
and our TargetRisk product range saw a
recovery of 2022 losses. In addition, the
Varagon acquisition brought a material AUM
boost and FX moves led to an increase in
AUM for non-USD funds or share classes.
Our largely institutional client base has
shown continued interest in our product
offerings which led to net inflows. A
discussion of Man Group’s investment
performance is included on page 17.
Man Group plc | Annual Report 2023
Strategic report 31
Link to strategy
1 Innovative investment strategies
2 Strong client relationships
3 Efficient and effective operations
4 Returns to shareholders
Risk
Mitigants
Status and trend
Change
Business risks continued
Key person
risk
A key person to the business leaves or is
unable to perform their role.
Retention risk may increase in years of poor
performance and the expectation of
reduced compensation.
1
3
4
Business and investment processes are
designed to minimise the impact of losing
any key individuals. Diversification of
strategies and the emphasis on technology
and systematic strategies reduce the overall
risk to Man Group.
Succession plans and deferred
compensation schemes are in place to
support the retention of senior investment
professionals and key management.
Man Group has continued to be able to
attract and retain an array of talented
individuals across the firm.
We did not see any investor concerns or
material outflows as a result of announced
departures or changes in management
structure in 2023, including the leave of
absence of our deputy CEO, the retirements
of our CEO and Chair of the Board, the
transition to their in-house replacements
and a subsequent ExCo reorganisation.
Credit risks
1
2
3
4
Counterparty
A counterparty with which the funds or
Man Group have financial transactions,
directly or indirectly, becomes distressed
or defaults.
Shareholders and investors in Man Group
funds and products are exposed to credit
risk of exchanges, prime brokers,
custodians, sub-custodians, clearing
houses and depository banks.
Man Group and its funds diversify
exposures across a number of the
strongest available financial counterparties,
each of which is approved and regularly
reviewed and challenged for
creditworthiness by a firm-wide
counterparty committee.
The risk teams monitor credit metrics on
the approved counterparties daily. This
includes credit default swap spreads and
credit ratings.
The March banking crisis highlights the
benefit of our conservative approach to
counterparty selection and appropriate
diversification in line with the Board’s
appetite. We had no exposure to the US
regional/specialised banks and our net
exposure to Credit Suisse at the start of
the crisis was small but nevertheless
closed out.
Liquidity risks
1
3
4
Corporate and
fund
Volatile markets and reduced market
liquidity can place additional, often
short-term, demands on the balance sheet.
Man Group is exposed to having insufficient
liquidity resources to meet its obligations.
Adverse market moves and volatility may
sharply increase the demands on the liquid
resources in Man Group’s funds. Market
stress and increased redemptions could
result in the deterioration of fund liquidity
and in the severest cases this could lead to
the gating of funds.
An $800 million revolving credit facility,
maturing December 2028 with two
one-year extension options, provides Man
Group with a robust liquidity backstop.
Liquidity forecasting for Man Group and the
UK/EEA sub-group, including downside
cases, facilitates planning and informs
decision-making.
The Investment Risk team conducts regular
liquidity tests on Man Group’s funds. We
endeavour to manage resources in such
a way as to meet all plausible demands
for fund redemptions according to
contractual terms.
The acquisitions of Varagon and Asteria,
the balance sheet seeding programme
and completion of two $125 million share
buybacks in 2023 were planned and
managed without issues. The revolving
credit facility was extended and increased
by $300 million, to $800 million, to cater
for future growth opportunities and provide
capacity for Varagon balance sheet loan
origination, in place of their legacy facilities.
The asset liquidity distribution across funds
remained broadly unchanged. Our in-house
liquidity analysis and reporting toolkit
continued to evolve and now includes
reverse stress testing.
The banking crisis and geopolitical events
later in the year led to a need to cut material
positions in our trend-following funds
– despite the large market participation,
these were achieved without issues, albeit
at a wider bid-offer spread.
Market risks
1
3
4
Investment
book
performance
Man Group uses capital to seed new
funds to build our fund offering, expand
product distribution and generate returns
for shareholders. Man Group also holds
CLO risk retention positions until the
product maturity, and is currently
participating in a US CLO Warehouse
to facilitate a product launch.
Varagon loan origination is a new balance
sheet risk with similarities to CLO risks but
much shorter term.
The firm is therefore exposed to a decline in
value of the investment book.
A disciplined framework ensures that each
request for seed capital is assessed based
on its risk versus return and its commercial
opportunity to Man Group.
Approvals are granted by a Seed
Investment Committee (SIC), which is
comprised of senior management, Group
Risk and Treasury. Investments are subject
to risk limits, an exit strategy and are
hedged to a benchmark where appropriate.
The positions and hedges are monitored
regularly by Group Risk and reviewed by
the SIC.
The investment book size was stable over
2023 with 14 new seed positions offset by
recycling of existing investments. However,
the overall risk has increased with the
addition of two equity CLOs. The pure
seeding book returns were positive, with the
benchmark hedges performing as intended
in the volatile markets. Additional gains
came from reversal of prior year losses on
our CLO risk retention positions.
We extended the use of repo and
swap financing on some of the CLO
and seed positions by bringing on a new
counterparty. Although external financing is
more costly in higher rate environments, this
released balance sheet liquidity.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 32
Risk management continued
Risk
Mitigants
Status and trend
Change
Market risks continued
1
3
4
DB pension
performance
Man Group underwrites the risks related to
the UK defined benefit pension plan which
closed to new members in 1999 and future
accrual in 2011. The plan is healthy but is
exposed to changes in net asset versus
liability values. This could come from
underperformance of return seeking
assets or changes in expected member
longevity assumptions.
The UK pension plan has a low net
exposure to UK interest rates and RPI
inflation though the use of Liability-Driven
Investment (LDI) funds. The return-seeking
assets are low volatility and have a low
correlation to directional equity markets.
Longevity is the largest risk but is
uncorrelated to Man Group’s other risks.
The plan is operated separately from Man
Group and managed by independent
trustees, including investment decisions.
The scheme remains in surplus on both
an accounting and actuarial basis with no
further challenges arising from the use of
LDI funds with UK rate movements. Whilst
the cost of an insurance buyout of the
scheme remains in excess of our appetite,
the LDI hedges have been calibrated to
position the portfolio towards a future
buyout if the trustees deem appropriate.
A triennial valuation will update the actuarial
assumptions as of 2023 year-end.
Operational risks
1
2
3
4
Internal
process failure
Risk of losses or harm resulting from
inadequate or failed corporate or fund
processes within Man Group, including
employee-related issues.
Man Group’s risk management framework
and internal control systems are based on
a three lines of defence model and have
continued to operate during the year.
Man Group remains focused on enhancing
its systems and control processes where
required and ensuring internal process
failures are kept to a minimum.
Risks and controls are reassessed on an
ongoing basis and in the event of material
change, to determine the adequacy of the
control environment.
Man Group’s Operations team has
implemented a robust methodology
(including ongoing third-party due
diligence and KPI monitoring) to confirm
that outsourced service providers are
delivering as required.
External
(third-party)
process
failures
Man Group continues to outsource several
functions as well as managing outsourcing
arrangements on behalf of its funds. Risks
arise through the supplier life cycle from
sourcing and selection, to contracting
and onboarding, to service delivery
and monitoring and finally, to exit and
offboarding. The most material risk is that
the outsourced service providers do not
perform as required, including bankruptcy,
resulting in knock-on implications for our
business and processes.
Model and
data integrity
Man Group is a technology-empowered
active investment management firm
which continues to make use of
advanced quantitative trading strategies
that necessitate a robust approach to
data acquisition and consumption, model
implementation and execution. Key risks
include model/algorithm failures or issues
with data upon which decisions are made.
Man Group has embedded systems,
controls and operational change control
processes for models and data. Change
management controls are applied to new
models, model changes and calibrations.
Controls are both preventative and
detective to minimise the potential
consequences from such an event arising.
Man Group has not observed an increase in
material internal risk events in 2023.
The firm’s key outsourcing providers
remain intentionally concentrated with a
small group of carefully selected and proven
names with which it has well established
and embedded working relationships.
There has been no notable increase
or decrease in the number of material
issues caused by, or experienced by,
our outsource providers during 2023
and there have been no material losses
or other impacts.
Man Group continues to source and
provision new investment data sources and
data analytics, but has not observed an
increase in material internal risk events
in 2023.
Information
and
cybercrime
security
Risk of losses or harm resulting from the
loss of information in electronic or hard
copy form held by Man Group and arising
as a result of sabotage, hacking, virus
attack or other malicious disruption causing
system failure.
Information
technology
and business
continuity
Risk of losses or harm incurred by IT
software and hardware failures resulting
in system downtime, severely degraded
performance or limited system functionality.
Business continuity risks may arise from
incidents such as a denial of access to a
key site or a data centre outage, which
could lead to business disruption.
Man Group has an established information
security and cyber security programme
with relevant policies and procedures,
that are aligned with industry expectations
and best practices. Man Group’s Chief
Information Security Officer, together
with the Information Security Steering
Committee, ensures that our control
environment is continuously reviewed
and adjusted to keep pace with the
evolving regulatory, legislative and cyber
threat landscapes.
Man Group continues to improve its
defence using state-of-the-art technologies,
enabling us to detect and prevent malicious
activities and complex cyber-attacks.
Although we have not experienced any
material issues in 2023, the increasing
cyber risk assessment is fuelled by a
multitude of factors including the rise of
AI-driven phishing attacks via models like
ChatGPT; the increasing risk of vulnerabilities
in the supply chain; and the increasing
impact and cost of cyber breaches.
Technology plays a fundamental role
in delivering our objectives. The single
Technology team of 500+ professionals
aligns with each business unit to ensure
work is correctly prioritised and financed.
The prioritisation process considers the
life cycle of both hardware and software
to ensure both are adequately supported
and sized. The firm’s operational processes
include mature risk, incident and problem
management procedures to minimise the
likelihood and impact of technology failures.
Business continuity risk mitigation includes
detailed planning and testing of remote
access and contingency/recovery operations,
and ongoing risk and threat assessments.
Man Group has an ongoing focus
on improving our technology offering,
capability and security. Particular
focus and investment have been on the
enrichment of the trading and operations
platform, including the centralisation of
order management.
Annual combined disaster recovery
exercises have been conducted across key
trading applications which were switched to
run from our back-up data centre.
Man Group plc | Annual Report 2023
Strategic report 33
Risk
Mitigants
Status and trend
Change
Operational risks continued
1
3
4
Criminal
activities
Legal,
compliance
and regulatory
Risk of losses or harm through wrongful,
unauthorised activities or criminal deception
intended to result in financial or personal
gain; or incurred through failure to comply
with (or have adequate procedures
to ensure compliance with) laws
and regulations relating to anti-money
laundering, counter-terrorist financing,
anti-bribery and corruption, breach of
economic sanctions, insider trading and
market abuse.
The breadth and complexity of the
regulations and legislative requirements
that Man Group and its funds are, or were
historically subject to, across multiple
jurisdictions, represent significant
operational risks, should the firm fail to
comply with them. Man Group supports
proportionate and thoughtful regulation
and initiatives that develop the regulatory
environment. However, change can also
result in increased operational complexity
and costs to Man Group or the sectors or
markets in which it operates.
Failure to comply with laws and regulations
may put Man Group at risk of fines, lawsuits
or reputational damage.
Man Group operates a framework
consisting of policies, procedures
and regular training to staff to support
compliance with applicable laws
and regulations.
Internal policies, processes and controls are
subject to regular review and consultation
internally and with external advisers
to ensure we remain well placed to
manage evolving requirements. Support,
independent oversight and challenge
is also being provided by Man Group’s
Compliance and Financial Crime teams.
Man Group operates a global legal and
compliance framework which underpins all
aspects of its business and is resourced
by experienced teams. These teams are
physically located in Man Group’s key
jurisdictions, helping them to understand
the context and impact of any requirements.
Emphasis is placed on proactively analysing
new legal and regulatory developments and
communications to assess likely impacts
and mitigate risks. The governance
framework includes ongoing proactive
reporting and management of potential
and actual legal and litigation risks.
Man Group continues to liaise directly and
indirectly with competent authorities e.g.
FCA, SEC, FINMA, CBI.
Man Group continues to strengthen and
adapt its control environment to monitor
and meet the challenges of an evolving
regulatory environment with heightened
sanctions and enforcement actions.
No material incidents were seen in 2023,
and the firm complies with all sanctions,
including those relating to the Russian
invasion of Ukraine.
Man Group continues to experience
new regulatory requirements. In 2023 this
included further embedding of requirements
of the FCA’s IFPR in relation to regulatory
capital and liquidity (including the ICARA),
governance and remuneration regime and
to the (UK Funds) Assessment of Value.
The SEC Private Fund Advisor Rules will
be a focus area for 2024.
Man Group maintained an open
dialogue with regulators throughout
2023 and work continues on a number of
regulatory initiatives.
Reputational risks
Negative
publicity
The risk that an incident or negative
publicity undermines our reputation as
a leading investment manager and place
to work. Reputational damage could result
in significant redemptions from our funds,
and could lead to difficulties with external
financing, credit ratings and relations
with core counterparties and
outsourcing providers.
Our reputation is dependent on our
operational and fund performance and the
conduct of our employees. Our governance
and control structure mitigates operational
concerns, and our attention to people and
investment processes are designed to
comply with accepted standards of
investment management practice.
We encourage a culture of openness,
inclusion and diversity.
1
2
3
4
Man Group enjoys a good reputation and
work continues to build Man Group’s profile
and protect its reputation across
stakeholder groups.
Emerging risks
Potential
future threats
Emerging risks are complementary to the
current principal risks and represent
potential future threats to Man Group’s
performance, development or viability. By
definition, these entail greater uncertainty
about if or when the risk or an event
may manifest.
The emerging risk categories include
natural disasters, pandemics, disruption
to financial markets and business
infrastructure, geopolitical risk and
changes in the competitive landscape.
1
2
3
4
The Board, Executive Committee and risk
teams monitor emerging risks, trends and
changes in the likelihood or impact following
discussions with subject matter experts.
This assessment informs the universe of
principal risks managed and mitigated by
the firm.
Emerging risks are now reviewed and
discussed by the Board on a six-month
cycle. The key themes this year were
heightened geopolitical tensions (Russia,
Israel/Gaza, China, the US and the UK), the
continued fragile state of financial markets
(volatility, liquidity, interest rates) and the
potential impact of AI models and their
misuse. No changes were made to
Man Group’s headline principal risks.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 34
Risk management continued
Risk
Mitigants
Status and trend
Change
Climate change risks
1
2
3
4
Physical risks
Physical risks, and specific event
uncertainties, of business disruption,
property damage or to employee well-being
due to a severe weather event.
Man Group has a small number
of employees, a relatively limited
physical footprint and can operate
completely remotely.
The firm will continue to monitor and
manage its risks through business-as-usual
reporting and management processes for
the relevant principal risk (see below).
Transition
risks
Transition risks, and timing uncertainties,
as the world moves towards a low-carbon
economy can be legal, regulatory,
technological, market or reputational.
This may impact the appetite for and
performance of some investment products.
Man Group has an agile business model, so
is well equipped to adjust to medium-term
transition risks and also capture any
opportunities. With a strong track record for
innovation, the firm continues to focus on
providing investors with products that
incorporate ESG analytics.
Man Group met its 2023 emissions
targets and work continues in line with our
pathway to net zero by 2030. This includes
a ‘Building Performance Optimisation
review’ of our London headquarters and
work to become ISO 14001 accredited by
the end of 2024.
We saw a significant reduction, compared
to our 2019 baseline, in the weighted
average carbon intensity (WACI) for our
AUM subject to Net Zero Asset Managers
initiative (NZAMI) interim targets. We
monitor progress against our NZAMI target
and report annually via the UN-backed
Principles for Responsible Investment.
Link to our
other principal
risks
Investment performance is exposed to
market disruption or volatility triggered by
severe weather events. Performance could
also be impacted by fundamental moves in
underlying asset prices or liquidity as the
world transitions to a low-carbon economy.
Man Group’s diversified range of products
and strategies limits the risk to any
particular strategy or market. While the
integrated portfolio and risk management
processes help managers understand their
risk profiles.
In 2023 we continued to expand our ESG
analytics toolkit including a Man Group
proprietary carbon dataset, integrating Paris
alignment data and the inclusion of green
bond funding. We now have 39 Article 8
and 9 products.
Business continuity risk manifests as
damage or disruption to Man Group’s
offices and data centres and the
transportation and supply systems that
support them. In particular our London
headquarters may be exposed to flooding
of the River Thames.
Legal and reputation risk currently comes
from any suggestion of greenwashing
if the ESG credentials of a fund or our
corporate behaviour does not meet client or
regulatory expectations. This could lead to
redemptions and regulatory fines as well as
damaging relations with core clients,
employees and the wider public.
Agile working is well established, and
employees can work remotely if offices
are inaccessible. We conduct detailed
planning for emerging scenarios along with
testing of remote access and contingency/
recovery operations.
Man Group has specific policies and
greenwashing controls which continue to
evolve and are subject to robust review.
We take a relatively low key and considered
approach in our external communications
with a focus on education and data as well
as highlighting the challenges inherent in
this area.
Our operations and ability to work
effectively was not materially impacted by
the summer heatwaves across the US
and Central and Southern Europe, with the
majority of employees working remotely.
Man Group climate change risk
management and strategy
Man Group recognises the urgent challenge
presented by climate change, and our
corporate responsibilities and ability to effect
positive change through our own behaviour,
responsible investment principles and fund
offerings. We address climate-related risks
and opportunities in the following ways:
1. Ensure that we are at the forefront of
delivering climate-focused investment
strategies.
2. Apply a rigorous, data-driven process to
ESG integration.
3. Focus on our stewardship efforts to drive
meaningful, positive outcomes.
4. Contribute to industry-wide initiatives and
thought leadership.
5. Manage our corporate operations in a
sustainable way.
The firm has articulated its climate change
risks using existing risk identification
processes: from the bottom-up the Risk and
Man Group plc | Annual Report 2023
Control Self-Assessment (updated at least
annually) has identified short-term risks by
business area, while the top-down (semi-
annual) emerging risks assessment identifies
medium- and long-term Group-wide risks.
Both of these processes assess risks in terms
of impact (such as business continuity,
financial, regulatory or reputational) and
likelihood (or time frame over which it may
manifest). By using the same risk assessment
framework we are able to calibrate the relative
significance of climate-related risks against
our other principal risks.
For short-term risks there are associated
controls and/or actions that help manage/
mitigate them. Climate change risks are
captured in Man Group’s risk governance
and reporting framework as a standalone risk
but also within the associated risk category
such as investment performance or business
continuity. The risk governance framework is
owned by the Board and implemented by the
senior management of Man Group, and it is
at this level that strategic decisions are made
to avoid, mitigate, transfer or accept risks,
including those related to climate change.
The impact of climate change on the
downside scenarios within our three-year
business planning horizon has been
considered – currently none of Man Group’s
plausible material downside scenarios, within
this time period, are materially driven by
specific adverse impacts of climate change.
We consider ‘material’ risks or downside
scenarios as being above a threshold of
importance to our investors, shareholders
and other stakeholders such that they should
be publicly reported. The threshold and
downside scenarios will evolve over time and
in line with the consensus path to a 1.5°C or
2°C scenario. Our senior management and
internal committees will continue to reassess
our risk profile in this context.
The key short-term risk (one to five-year time
horizon) and strategic opportunity for Man
Group relates to meeting and exceeding
client expectations for inclusion of meaningful
climate-related analysis into our investment
strategies. Failure, or taking too long, to deliver
genuinely suitable investment products could
lead to outflows or reduced inflows over time.
Strategic report 35
35% of Man Group AUM integrates ESG
analytics into the investment process, and
we now offer 39 Article 8 and 9 products.
A related reputational risk comes from any
suggestion of greenwashing if the ESG
credentials of a fund or Man Group’s corporate
commitments do not meet client, regulatory,
media or wider public expectations.
In the medium term (five to ten-year time
horizon), the key risks and uncertainties
to Man Group are from market disruption
or volatility triggered by weather events
and disruption to transport and working
arrangements. These could lead to increased
costs (e.g. procurement, insurance or taxes)
and restrictions on business practices such
as international travel to meet clients, however
they also present significant investment
opportunities. Some of these risks are already
being mitigated through ongoing investment
in collaboration technology and flexible
working, and others can be addressed
through agile working practices and having
a more local presence. Thoughtful new
regulatory requirements will be an important
tool in helping companies to consistently
effect genuinely positive change – we will
closely monitor emerging requirements and
have been, and will seek to be, early adopters
of new regulations.
As the world transitions towards a low-carbon
economy fund performance could be
impacted by fundamental moves in
underlying asset prices or liquidity. The firm
has continued to enhance its proprietary
ESG analytics tool to facilitate analysis of the
underlying exposures through an ESG lens.
Longer-term (ten to 30-year time horizon)
physical risks, with associated high
uncertainties, include major business or
market disruption following severe weather
events and long-term impacts on employee
health and well-being. For example, the
corporate headquarters in London could be
impacted by a failure of River Thames flood
defences. Such events, or even a heightened
risk, could cause the firm’s key business
locations to become less relevant. This is
mitigated through long-range monitoring and
our small physical footprint helps to reduce
our exposure.
We are committed to demonstrating
responsible conduct and leadership to all
of our stakeholders – clients, shareholders,
business partners, employees and our local
communities. Our strategic initiatives relating
to our direct environmental footprint and our
approach to corporate sustainability and
responsible investing are discussed on pages
46 to 61, This includes an outline of our
pathway to net zero for both our workplace
(page 48) and investment portfolios, aligned
with the NZAMI (page 53). Our support of the
Task Force on Climate-related Financial
Disclosures (TCFD) is outlined on pages 62 to
64 and our stewardship role in relation to
responsible investment is discussed on
pages 57 and 58.
As our understanding of climate-related
risks and opportunities evolves and we
develop a better understanding of the
interdependencies between climate factors
and their impact on our business, we will
continue to refine our strategy.
Viability statement
The directors of Man Group plc believe that
there continues to be robust global demand
for asset management firms, such as
Man Group, to provide fund management
services and make active investment
decisions on behalf of their clients in order
to manage their capital. Man Group’s ability
to deliver alpha and other value adding
client solutions, backed by technology,
efficiency and innovation, forms the basis of
a sustainable business model.
A failure to deliver superior performance
is the main risk to, and driver of uncertainty
for, Man Group’s ability to maintain
adequate capital and liquidity, given the
likely short-term impact on client
redemptions and longer-term one on talent
retention. This risk is mitigated through our
diversified fund offering. The directors
confirm that they have a reasonable
expectation that Man Group will continue to
operate and meet its liabilities, as they fall
due, for the next three years to
31 December 2026. A three-year period is
considered appropriate because it is
consistent with Man Group’s business
planning and forecasting horizon.
Man Group plc | Annual Report 2023
In accordance with the UK Corporate
Governance Code, the directors’
assessment has been made with reference
to Man Group’s current position, the firm’s
strategy, the Board’s risk appetite and Man
Group’s principal and emerging risks and
uncertainties and how these are managed
(described earlier in this section). The
principal risks are linked to each of Man
Group’s strategic priorities. The strategy
and associated principal risks form the
basis of Man Group’s medium-term plan.
This covers a three-year period and
includes downside scenario testing.
Man Group’s medium-term plan is
built by aggregating the expected
business performance across the
firm, and then stressing key business
assumptions, including:
• fund inflows from new business
versus redemptions;
• investment performance of the
key strategies and the impact on
management and performance fees;
• performance of the balance sheet
investment positions;
• management fee margin pressures;
• business mix and costs, including
compensation and investments in
business development; and
• FX rates for non-USD AUM and costs.
Severe but plausible stress scenarios are
applied using combinations of the above
factors, such as:
– Extreme underperformance and
associated outflows across Man
Group’s product range or for a
core investment product group as
a result of a single market stress; or
– the impact of a major operational
event that leads to irreparable
reputational damage and outflows.
Although the directors and management
have considered the impact of climate
change, currently none of Man Group’s
plausible downside scenarios (within the
three-year business planning horizon)
are materially driven by specific adverse
impacts as a result of climate change. We
continue to review this assumption on a
regular basis.
The medium-term plan assessment is
augmented throughout the year by regular
briefings at the ARCom on risk and controls,
as well as dashboards across financial risk,
non-financial risk, finance and Internal Audit.
The principal risks are considered within the
Board’s risk appetite framework.
Strategic report | Governance | Financial statements | Shareholder information 36
As a people business, our priority is to hire world-class
talent across the firm. Our culture of innovation, together
with our commitment to diversity, equity and inclusion,
allow us to create an environment where everyone has
the opportunity to reach their full potential.
The acquisition of Varagon Capital Partners has added
to our credit capabilities and the breadth of the talent we
have across the firm. By bringing together expertise from
multiple technical and investment disciplines, we are better
able to deliver solutions that address our clients’ most
complex problems.
Talent+
Solutions
¬ For more information, please visit:
www.man.com/careers
Man Group plc | Annual Report 2023
Strategic report 37
85+
Number of investment strategies
500+
Number of investment
professionals
$28.1bn
AUM in credit strategies
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 38
People and culture
A deep and diverse pool of talent
We seek to attract, develop and retain the best talent. Our
emphasis on inclusion, collaboration and engagement
enables us to drive performance through diversity of
thought, combining our range of expertise in unique ways.
We remain committed to an inclusive
workplace where our colleagues are
supported and equipped with the tools
they need to develop and thrive. Our culture
is strong and distinct within our industry;
it enables us to attract and retain talent,
to innovate and build our competitive
advantage, and to deliver better outcomes
for our clients and other stakeholders.
Man Group’s total headcount, including
contractors and consultants, has increased
from 1,682 at 31 December 2022 to 1,816 at
31 December 2023, a large increase this year
following the acquisition of Varagon Capital
Partners. We continue to operate an agile
working model that enables us to access
new pools of talent, support well-being and
maximise productivity.
Collaboration and engagement
Our culture of collaboration underscores our
ability to find answers to complex problems
and demonstrates the value of working
together. We pride ourselves on our
willingness and drive to learn from each
other every day. We monitor employee
engagement and retention actively to ensure
that we are holding ourselves to account to
deliver on our key objectives. Our annual
employee engagement survey, alongside our
employee engagement programme led by
the Man Group Board, ensures our people
can contribute their thoughts, ideas and
feedback regularly. In 2023, we achieved an
employee engagement score of 8.1 out of
10 and our voluntary attrition rate reduced
further (from 10.7% in 2022) to a low of 7%.
Talent acquisition and equal
opportunities
We remain committed to hiring the best talent
from around the world and have grown our
headcount by 26% over the last five years.
Following the in-sourcing of our global
recruitment efforts at the start of 2022, we
have seen a steady growth in direct hiring.
We also welcome candidate referrals from our
staff. Those interacting with the talent markets
on our behalf have a strong grasp of our
culture, support our ambition to continue to
diversify our talent pipeline and are well placed
to identify candidates who are likely to thrive at
Man Group.
We are committed to providing equal
employment opportunities, and do not tolerate
any discrimination, whether on the grounds of
age, disability, gender, gender identity, race,
religion, sexual orientation or educational
background. Full and fair consideration is given
to all employment applications, including from
disabled people, considering their aptitudes
and abilities, with candidates encouraged to
tell us if they require reasonable adjustments
to the process, for example due to disability or
neurodiversity. We ensure that disabled people
are fairly treated in respect of training and
career development. For those who become
disabled during their employment, reasonable
adjustments are made and the required
ongoing support is provided to enable the
individual to continue working.
We continue to prioritise building a junior
talent pipeline via entry-level programmes,
including work experience opportunities, our
apprentice programme, and our intern and
graduate programmes. This year, in the UK,
Nationalities
70+
Quants and technologists
675+
2nd most used language
Python
Discretionary investment professionals
110+
We know that junior talent
is incredibly important for
our business and we design
our internship and graduate
programmes to ensure they
challenge and inspire those
taking part, as well as ensuring
support for the various business
units in which they are placed.
Angus Jacobs | Head of Talent Development
Man Group plc | Annual Report 2023
Strategic report 39
+ Teaching
Q&A
Sharleen
Hussey
Engineer, Front Office Engineering
Q: What value has brought to
our people?
A: offers a wide range of courses for
staff at all levels and across all business units at
Man Group. The courses vary in duration from
half-day sessions through to multiple weeks.
They also range in complexity, starting with
‘Python 101’ for complete beginners, which
covers programming fundamentals and the
benefits of automation, all the way through
to ‘Quant Stats for Finance’ where Python
is used as a tool for simulations, risk analysis
and portfolio construction. Our experienced
developers teach these courses and we also
include subject matter experts from relevant
departments to cover more advanced topics.
is a flexible programme that can
be tailored to individuals’ needs and we are
always adding to the programme to ensure our
people stay up to date as technology evolves.
Staff who have ‘graduated’ from courses
have implemented significant operational
improvements across the business, which
include process automation and additional
data analytics.
Q: How can employees take part?
A: Anyone can register – from any location
or business unit. We also run courses for
departments and other groups; for example,
we ran a course for our BEAM network and
another tailored to our Central Trading team’s
requirements. A personal highlight, however,
was a course for our Middle Office Accounting
team, which was specifically designed to
cover automation of daily processes. We run
tech talks regularly which feature
use cases from teams or individuals across our
business, where automation has succeeded in
optimising workflow.
as well as visiting individual schools and
universities, we continued to work with City
Gateway, #10,000BlackInterns, IntoUniversity,
GAIN (Girls Are INvestors), and SEO London.
In New York, we have partnered with the
UNCF Lighted Pathways Program. We
also recognise the importance of enabling
experienced talent to return to work and
drive this initiative forward through our
Returners programme.
Talent development
Our talent development strategy is a fully
established, core part of our business. We
have the processes, technology, products
and services that enable us to maximise the
potential of our people. We provide career
development and performance support
to staff at all levels and in 2023, 91%
of employees voluntarily engaged in
this support.
Our talent development efforts are guided
by a globally adopted talent review process,
which seeks to assess the performance and
potential of each employee every six months.
The data and insights from this process are
part of our bi-annual talent and succession
planning reviews, which are shared with
and assessed by our Executive Committee.
These reviews, alongside targeted initiatives,
create equitable opportunities for talent
progression and ensure that we have a bench
of future leaders ready to take on broader
leadership roles across the firm. We continue
to invest in our in-house coaching capabilities
to provide top performers with the support
necessary to optimise their performance. In
2023, a significant portion of our identified top
talent benefited from structured coaching
in addition to other development initiatives
available to all staff.
We are committed to continuously enhancing
the learning and development offering
available to our staff. Our ‘Investment Insights’
series has shared the unique perspectives
and philosophies of our best discretionary
investors with other investment professionals.
Our in-house ‘Evolve’ programme equips
employees with an introduction to the hedge
fund industry, helping them to build a strong
foundational knowledge of hedge funds and
a better understanding of clients’ needs and
perspectives. Our programme
is Man Group’s response to the digital skills
gap and offers our staff the opportunity to
improve their technical competencies. Since
inception, it has taught 304 employees
to code in Python and has upskilled
477 employees in total through the more
advanced courses. In addition, at any one
time, around a third of our workforce is
actively engaged in mentoring.
This connected approach also allows us
to champion and facilitate internal mobility.
In 2023, more than 200 employees were
internally mobile due to robust succession
planning and notably we were able to internally
fill positions following the retirement of Man
Group’s CEO, as well as the subsequent
changes to our Executive Committee.
Remuneration and reward
We aspire to be competitive in the markets
in which we operate, and our remuneration
strategy and extensive benefits platform is an
integral way to retain and reward our people.
Remuneration includes a combination of
salary, annual performance bonus and
deferred awards, alongside a comprehensive
range of non-cash benefits. Our deferral
arrangements are a key mechanism to focus
our employees on long-term performance,
aligning their interests with those of our clients
and shareholders. During 2023, we once
again offered our UK-based employees the
opportunity to participate in the Man Group
Sharesave Scheme at the maximum limit and
discount allowed by HMRC.
See pages 100 to 123 for the Directors’
Remuneration report.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 40
People and culture continued
+ Encouraging talent
Q&A
Shyam
Mamtora
Analyst, Discretionary Middle Office,
Product and Client Operations
Q: Why is our school outreach programme
important?
A: I really enjoy my role at Man Group and I
am keen to spread the word far and wide about
the breadth of opportunities in the sector. By
informing students about these career paths,
we provide them with the opportunity to spark an
interest that could last a lifetime. I welcomed the
chance to run our workshop called the ‘Trading
Game’, which is one of the many programmes
we use with students. It makes them think about
investing: what they might buy and sell, and
when. I like working with students, asking them
how they arrived at their decisions and of course,
revealing the results!
Q: How do you use your volunteering days
with the school outreach programme?
A: All staff are given two ‘ManKind’ volunteering
days to support causes that are important to
them. The time can be broken into hours, if
needed, or used as a day. In 2023, I used one
of my ManKind days to run an ‘Insight Day’
for students from Warwick University’s Asian
Society. We had 30 students come into our
London office for a tour, to listen to presentations
on Man Group’s investment engines and to learn
more about career opportunities. I am grateful for
the opportunity to combine my passion of giving
back to the community, whilst also representing
the firm and what it has to offer.
Man Group plc | Annual Report 2023
Diversity, equity and inclusion
Our ‘Drive’ programme remains focused
on ‘grassroots’ initiatives and is run by our
employees and sponsored by members of
our Executive Committee. The programme
ensures that our people can feed back
thoughts and ideas and contribute to our
work, both internally and externally, helping
to drive change within our firm and across
the industry. Drive is overseen by our
diversity, equity and inclusion (DE&I) Steering
Committee, which ensures representation of
staff from across our business and around
the world. Our Drive umbrella includes the
following active staff networks:
• BEAM (our network for Black Employees
and Allies at Man)
• FAM (our network for Families at Man, of all
shapes and sizes)
• PRIDE@Man (our network for the LGBT+
community and allies)
• WAM Network (Women at Man, our
network promoting gender balance at
Man Group and allies)
• SANAM (South Asian Network at Man
Group)
• Amigos de Man (our network for our
Latin and Hispanic employees and allies
at Man Group)
During 2023, we launched a new Amigos
de Man network for our Latin and Hispanic
communities. We also launched a new
workstream for our Jewish employees and
allies, which joins existing workstreams
focused on our younger professionals
(NextGen), Social Mobility, Veterans,
Neurodiversity and Disability.
Inspiring the next generation
We are dedicated to promoting a career in
finance to young people from all backgrounds
and, as such, have expanded our school
outreach programme during 2023. The
programme offers career talks, workshops
on the ‘Art of Selling’ and the ‘Trading Game’
to introduce the concept of investing, and
Insights Days for school and university
students. This past year, we held our first
work experience week targeted at students
Board
5
Senior
Managers 31%
33%
Staff
Female
Male
3
69%
67%
1 Based on 1,790 FTEs and 106 senior managers.
aged 15, with a group visiting our office in
London to learn about careers in the financial
services industry. We have also welcomed to
our offices in the UK and US groups from
GAIN, the Women Societies Alliance (a group
of women’s societies from universities in the
UK and Europe) and Rock the Street, Wall
Street. Once again, we featured in the ‘Skills
Workshop’ run by #TalkAboutBlack, which
was broadcast across universities to highlight
internships and graduate programmes at
Man Group.
Several of our senior leaders participate in the
Speakers4Schools programme and we aim
to combine their visits with relevant activities
from our school outreach programme. We
continue to partner with the King’s Maths
School in London (a specialist state-funded
school for gifted mathematicians), providing
career talks and mentoring. During the year,
we held mentoring sessions with teachers
at the school, and expanded our offering to
others working for educational charities to
support their learning and development as
they inspire the next generation.
Championing gender equity
and equality
Man Group supports the requirement for
employers in the UK to calculate and publish
their gender pay gap, and we have published
our figures within our annual Diversity, Equity
and Inclusion report. The data demonstrates
the lower representation of women in
investment management and senior
management roles; we are committed
to addressing this and continue to make
significant efforts to do so. While we do not
see a gender pay gap across similar roles, we
continue to take action to foster better gender
diversity across the firm.
During 2023, we appointed our first female
CEO and the first female Chair of our Man
Group Board. More than half of our Board
is female, and we continue to have a female
Chair of both the Audit and Risk Committee
and the Remuneration Committee. Man
Group has been a signatory to the Women
in Finance Charter since 2018, pledging to
promote gender diversity, setting targets
and reporting on progress. We achieved our
target of 25% female representation in senior
management during 2020 and at the end
of 2023, we had 31% of women in senior
management roles. As a result, we have met
our target for 2024 a year early, and to ensure
we keep challenging ourselves to improve,
the Board approved a new, higher target of
32.5% of women in senior management roles
for the end of 2024.
Strategic report 41
+ Learning from each other
Q&A
Solomon
Kuckelman
General Counsel, Americas and APAC
Q: How do you learn from our
DE&I programme?
A: I have had the opportunity to take part in a
few events this year. I joined the panel for our
AccessAbility workstream’s celebration of
International Day of Persons with Disabilities
in December. The event was held to highlight
Man Group joining the #PositivelyPurple
campaign run by PurpleSpace (a corporate
network to champion disability in the workplace).
We sought to provide attendees with an
increased awareness of disability and
neurodiversity, both in the workplace and
for those who are parents or carers of family
members who are disabled or neurodiverse.
It was a great opportunity to share experiences
and learn from colleagues about the spectrum of
needs and requirements, and how Man Group’s
resources can provide hugely helpful support.
While we learn from speakers, I have learned
just as much – if not more – from talking
through shared and different experiences
with other members of our team, and applying
lessons learned in support of colleagues and my
family at home.
Q: How can employees take part?
A: In addition to attending events and taking
advantage of the firm’s many available resources,
I welcome the opportunity to contribute to the
careers of my colleagues. I was really pleased to
take part in the allyship programme for our WAM
Network and I am excited to be part of its next
stage as we approach Allyship Week in 2024.
We continue to focus on coaching and
mentoring our high performing female talent
at all levels, and particularly those on the
pathway to senior management. The number
of women in senior management roles is
one of our non-financial KPIs, and forms
part of our Executive Directors’ remuneration.
Further information on this can be found
on page 123.
2023, we have run training with Scope
on ‘Disability Inclusion and Accessibility’.
We work with external initiatives where it
complements our internal efforts and our
continued work with PurpleSpace and
Exceptional Individuals to provide subject
matter expertise for our disabled and
neurodiverse staff and their managers is
a great example of that.
We are committed to contributing to DE&I
within the industry and to championing
thought leadership and progress through
our people’s commitment and excellence.
Setting targets for ethnic
representation
As a listed company, we welcome the
Parker Review and its focus on improving
representation of ethnic minorities at board
and senior management level. During 2023,
the Board approved a new target to increase
ethnicity in senior management at Man Group
to 15% by the end of 2027 and reported
this to the Parker Review. As at the end of
November, 87% of our staff had completed
their ethnicity data (this percentage includes
those who have chosen ‘prefer not to say’
and excludes the countries where we are
unable to collect this data from our people
due to jurisdictional restrictions). This new
target works alongside our existing focus
on building a diverse workforce and
specifically, increasing the representation
of ethnic minorities.
We have signed the Race at Work Charter
and take part in initiatives run by Race
Equality Matters. Our staff networks BEAM,
SANAM and Amigos de Man champion
engagement and awareness of the support
that is available to their members to progress
in their careers. Our staff have taken part
in the Black Leaders Mentoring and
Reverse Mentoring Programme run by the
Investment Association in collaboration with
#TalkAboutBlack, designed to help equip
senior Black leaders with the tools and
networks needed to achieve their professional
goals. We have engaged with Black Women
in Asset Management, EnCircle and several
of our staff are ambassadors for the Race
and Ethnicity workstream run by the Diversity
Project. We have entered a second year
of our partnership with Barrington Hibbert
Associates, to champion our Black talent and
increase representation within the industry.
More information about Man Group’s
commitment to DE&I can be found in the
Diversity, Equity and Inclusion report and our
Corporate Sustainability brochure.
During 2023 we joined 100 Women in
Finance and continued our sponsorship
of GAIN. We also signed the Tech Talent
Charter, championing the representation
of diverse talent in technology roles. We
have continued to support and contribute
content to the Diversity Project’s Pathway
Programme, which has been set up to
increase the number of female investment
managers. We continued our partnership
with Women Returners to support those
returning to work following a career break.
We were proud to see our efforts recognised
through industry awards in 2023. Maria Isaza,
Head of Investment Operations at Man Group
and co-chair of our WAM Network, was
awarded Highly Commended in the
‘Unsung Hero’ category at Investment
Week’s Women in Investment Awards.
Similarly, Marina Ebrubah, Global Head of
KYC at Man Group and member of our DE&I
Steering Committee, featured on the top ten
list of the ‘Future Leader’ category at the
2023 Ethnicity Awards.
Focusing on allyship and inclusion
During 2023, our networks and workstreams
came together to hold our third Allyship
Week, which promotes the importance of
being more supportive to our colleagues. We
also came together in September to celebrate
Inclusion Week. Alongside these two weeks,
our networks and workstreams have held
celebrations for International Women’s Day,
Black History Month in the UK and US,
Diwali, Eid al Fitr, International Day of Persons
with Disabilities and Hanukkah, to name a
few. We have hosted events and shared
perspectives, experiences and photos to
educate each other and become better allies
at work.
Working with the industry is also important
to have a greater impact. We continue to be
members of the Diversity Project and the
DEI working group run by the Alternative
Investment Management Association (AIMA).
We are in the second year as a founding
member of Progress Together, underlining
our commitment to staff from lower
socioeconomic groups. We are committed to
our status as a Disability Confident registered
employer and are working to achieve Level 2,
as per the UK government scheme. During
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information Flexibility and workspace
We have now embedded agile working
globally and continue to follow the framework
launched in 2021. We have made further
updates to our office space in London during
2023, increasing the space in our wellness
room and our facilities for those who cycle
to work. We have added to our collaboration
areas with a ‘maker space’ and games room.
We continue to receive excellent feedback on
the amenities at our workplace, whether for
our mindfulness room, our music room, our
mothers’ room, or our campfire room (where
we host mindfulness classes). We continue
to adapt our workspaces and to prioritise
flexibility wherever possible. Employees are
appreciative of the flexibility provided by agile
working, citing their improved ability to
manage their time, be involved in family
commitments and to consider the optimal
work environment for different work activities.
We continue our longstanding commitment
to flexible working arrangements, which can
include adjusted hours or part-time working,
with no restrictions on the reasons for
requesting these.
Support in the moments that matter
We support our people throughout the
employee life cycle, recognising that they
manage more than just work, and sometimes
life can take unexpected turns or that certain
life events need to take priority. We have
worked hard to ensure our benefits and
well-being provisions are competitive and
regularly review and benchmark our platform.
Our gender-neutral parental leave, our long
tenure awards and the bespoke support we
provide through fertility treatment, pregnancy
loss and menopause are all examples of our
commitment to the well-being and work-life
balance of our employees.
We have the courage to ask
the difficult questions and listen
and learn – we continually want
to improve!
Lucy Bond | Global Head of Sustainability
Number of parental leaves taken in
2023
Male
Female
68
38
Number of tenure award leaves taken
in 2023
Male
Female
29
14
42
People and culture continued
+ Promoting well-being
Q&A
Kate Elliott
People Partner, APAC
Q: Why is R U OK? day important?
A: R U OK? Day is a national day of action in
Australia. It encourages everyone to start a
meaningful conversation with those we care
about and simply ask ‘are you okay?’.
It’s about encouraging everyone to reach out
whenever they spot the signs of struggle in a
colleague, friend or family member. By taking
the time to ask someone if they are okay, and
genuinely listening to the answer with an open
mind, we can all help people feel supported
and connected. It’s important to ask people
and encourage them to have an open
discussion, before things get worse, or they
approach crisis. The ethos behind the day is
that a conversation could change a life.
Q: How can we reinforce this in the
workplace?
A: In Australia, offices are often decorated and
we host a breakfast or afternoon tea in the office,
to come together with the subject at the top
of our minds. Coming together is important as
we know that when people have a sense of
belonging, they are more likely to reach out for
help when they are in need. In fact, I was lucky
enough to celebrate this in our Sydney office and
then again when I visited our Hong Kong office
the following week! It also provides us with
another opportunity to highlight our well-being
resources and let people know who they can go
to with questions or if they need to find help.
Man Group plc | Annual Report 2023
Strategic report 43
The ManKind programme
enables us to make a real
difference in our local
communities. We are given
two additional days’ leave to
donate our time but just one
hour can help enact real change
in someone’s life. I am proud of
how the programme continues
to evolve so we can make the
biggest impact possible with the
time we are given.
Abby King | Trustee, Man Charitable Trust
Donations to a local food bank
or homeless shelter offered to all
our employees
£250
Employees volunteering in 2023
400+
Community investment
Our people take pride in contributing to their
local communities and charities through our
ManKind programme.
The year concluded with our annual
festive fundraising events, including a
global festive clothing day on 14 December
with participation across all our offices.
Additionally, in the UK and the US, the
Last Hour Appeal, which offers staff the
opportunity to donate the last hour (or more)
of their salary for the year, was a success
yet again. In the UK, these activities raised
£18,600 for MammaKind – a charity voted for
by UK staff. In the US, we raised $2,840 for
Read to a Child. We also participated in the
UNCF Walk for Education in the US, where
we raised a combined total of $10,000 from
Man Group employees and the Man US
Charitable Foundation.
During December, every employee was
offered the opportunity to expense a £250
(or local currency equivalent) donation to a
local food bank or homelessness support
charity. UK employees at Man Group are
also able to support charitable programmes
via their Give As You Earn accounts, and
99 staff participated during the year. The
Man Charitable Trust also proudly matches
independent fundraising by employees
up to the value of £1,000.
ManKind, our global employee volunteering
programme, encourages each member of
staff to take two days’ paid leave per annum
to help in our communities. Our people have
the flexibility to volunteer with a registered
charity of their choice, a charity supported
by the Man Group plc Charitable Trust (Man
Charitable Trust) or the Man US Charitable
Foundation. They may also use opportunities
via local partners; in London, ELBA (the East
London Business Alliance) connects us with
opportunities and in the US, we work with
Boston Cares and NY Cares.
Many departments have chosen to volunteer
together, taking a day away from the office
to contribute to their community as a team.
For example, our Hong Kong SAR office
has worked with a local project, ‘Seeds’,
throughout the year, donating food parcels
to the elderly and others in need.
Our Drive (DE&I) programme also promotes
volunteering: in 2023, our work with Breaking
Barriers (a charity supporting refugees back
into the workplace) helped refugees with
interview training. We formed the Man Group
knitters (#the-knitwork) in 2023, who knitted
squares for a blanket that was donated to
The Nightingale Cancer Support Centre. The
range of volunteering undertaken at the firm
means our people from across the globe can
participate in initiatives spanning virtual as
well as in-person opportunities at Man
Group’s offices or in the community.
Established in 1978, the Man Charitable Trust
supports a diverse range of charities in the
UK, with a particular focus on improving
education, and approved grants to the
following charities during the year: Auditory
Verbal UK, City Gateway, Discover Children’s
Story Centre, First Story, Greenhouse Sports,
Hibiscus Initiatives, MyBnk, NSPCC, Read
Easy, RedSTART, Refugee Education UK,
Starlight Children’s Foundation, The Brilliant
Club, The Switch, and XLP. The Man US
Charitable Foundation, founded in 2019,
also provides funding to US charitable
organisations that include: Brain Health
Bootcamp, Junior Achievement, Publicolor,
Read to a Child, and Rosie’s Place.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 44
Our strength in technology and quantitative analysis means
that we are in a prime position to understand the nuances
and complexities that ESG datasets present. It helps us
identify innovative responsible investment solutions to
support the diverse investment objectives of our clients.
We also have a deep-seated culture of responsibility that
extends across our firm; our commitment to minimising our
climate-related impacts are core to our global ESG efforts
and we continually challenge ourselves to review our
standards to ensure we are the best that we can be.
Sustainability
+Responsibility
¬ For more information on responsible
¬ For more information on corporate
investment, please visit:
www.man.com/responsible-investment
sustainability, please visit:
www.man.com/corporate-sustainability
Man Group plc | Annual Report 2023
Strategic report 45
$59.3bn
of ESG-integrated AUM
3
proprietary
ESG technology tools
83%
of environmental shareholder
resolutions supported in 2023
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 46
Sustainability and responsibility
Introduction
We are committed to running our company in a
sustainable and responsible way as we seek to grow.
We also continued to pursue a diverse RI
research agenda and hosted our inaugural
RI Summit in November, bringing together
academics and investors to discuss how a
data-driven approach to responsible investing
can help to create a more sustainable
future. In December, we also announced
a partnership with the Columbia Center on
Sustainable Investment (CCSI) to conduct
research addressing how climate impact is
defined and measured in fixed income and
equity portfolios.
As a part of our firm-wide strategic objectives,
our goal is to be recognised as a leader
in providing climate-focused RI solutions
to investors globally. Researching and
developing innovative investment strategies
and solutions that are compatible with
supporting a transition to net zero is a key
area of focus for Man Group. As a signatory
of the Net Zero Asset Managers initiative
(NZAMI), we are committed to attaining
net zero emissions within our investment
portfolios by 2050, and in July 2022, the
initiative approved our first set of interim
targets. These targets are based on the
percentage of assets we manage in line with
net zero emissions and include an associated
emissions reduction target.
We continue to disclose the greenhouse
gas emissions (GHG) from our AUM and
the weighted average carbon intensity (WACI)
for our key investment strategies. Further
information can be found on pages 60 and 61
of this section, and we remain committed to
refining our analysis over time, as the quality
of data improves and industry best practices
evolve.
As a global business we are committed
to minimising our operational impact on
the environment and to being consistent
and transparent about the progress we are
making. We have outlined our pathway to
achieve net zero carbon emissions in our
workplaces by 2030, which we review
regularly, and our people engage actively on
this topic. All staff complete training modules
on Man Group’s environmental objectives
and policy, participate in environmental
awareness campaigns and engage in
volunteering activities. We also host regular
seminars to educate employees from
across the firm on topical ESG subjects and
showcase our thought leadership to promote
and embed a culture of responsibility across
our entire business.
We will uphold, promote and
advance the highest standards
of responsible investment and
corporate sustainability.
Steven Desmyter | Man Group President
At Man Group, the responsibility to deliver
for our clients is at the heart of everything we
do. As we seek to implement our firm-wide
strategic objectives, our overarching goal is to
maximise long-term, risk-adjusted investment
returns for our clients and the millions of
individual savers and pensioners that they
represent. We recognise that there is no
single approach to sustainability. We
understand that each of our clients has
their own views on environment, social and
governance (ESG) matters. Our commitment
to Responsible Investment (RI) and Corporate
Sustainability (CS) is fundamental to our
corporate strategy, both as a listed company
and in the services we offer to our clients
around the world.
During the year, we continued to build our
responsible investment capabilities; we
launched a number of innovative ESG-
integrated investment strategies and
implemented new RI technological
capabilities to provide our investment
teams with additional support and to
ensure compliance with the evolving
ESG regulatory landscape.
Last year provided a challenging market
backdrop for sustainable investors. Higher
rates and poor performance of widely-held
ESG stocks all contributed to a mixed year
for ESG assets, in terms of fund performance
and flows. Despite this, our ESG-integrated
AUM grew to $59.3 billion as at the end of
2023, a 19% increase compared with 2022.
We base our calculation of ESG-integrated
AUM on the Global Sustainable Investment
Alliance’s ‘ESG Integration’ sustainable
investment approach and further details of
our methodology can be found on page 54.
This metric is a non-financial KPI (see page
21) and is also one of the ESG-aligned
metrics linked to executive remuneration
(see page 119), reflecting our commitment
to make continuous progress in this area.
Man Group plc | Annual Report 2023
We are a signatory to the United Nations-
supported Principles for Responsible
Investment (PRI) as well as active signatories
of the United Nations Global Compact
(UNGC), showing our support for the United
Nations’ (UN) ten principles on human rights,
labour, the environment and anti-corruption.
The UN’s Sustainable Development Goals
(SDGs) guide our ESG initiatives and
ambitions, and more detail on our broad
approach to CS, and alignment with the
SDGs, can be found in our Corporate
Sustainability brochure.
We are also a registered supporter of the
Task Force on Climate-related Financial
Disclosures (TCFD) and have included
disclosures aligned to its recommendations in
this report, providing more information on our
approach to managing climate-related risks
and opportunities across our business.
Further details can be found on pages 62 to
64. During 2023, we were pleased to have
been admitted as a member of the strategic
forum of the Task Force on Nature-related
Financial Disclosures (TNFD).
Our leadership in quantitative
investing and cutting-edge
technology allows us
to create data-driven RI
solutions across long-only
and alternative strategies.
Robert Furdak | Chief Investment Officer of RI
Strategic report 47
Governance is key
Strong governance underpins our entire
operation at Man Group, and we have
developed an overarching ESG governance
framework to oversee and control all
elements of RI and CS. This framework
ensures that we have strong oversight and
controls, up to and including the Man Group
Board, and that we have dedicated resources
to deliver on our ESG commitments and
to ensure that any associated risks are
identified, assessed and properly mitigated.
The RI Leadership team and CS Committee,
in conjunction with Man Group’s CEO and
Board, sets the overarching ESG vision and
strategy for the firm, seeking to embed RI
and CS within Man Group’s investment and
operational activities while identifying new
opportunities across the firm and promoting a
culture that holds us to the highest standards
of responsibility.
The RI Leadership team includes Man
Group’s President (Steven Desmyter), CIO
of RI (Robert Furdak) and Head of Solutions
(Carol Ward). They are supported by four
dedicated committees and a growing team
of RI professionals; each team has assigned
responsibilities and established processes
to identify, assess and monitor risks and
opportunities. The committees regularly
inform and report on RI-related matters to the
RI Leadership team, the Executive Committee
and the Man Group Board. Similarly, the CS
Committee reports on risks and governance,
as well as opportunities to the Executive
Committee and the Man Group Board.
Our broader team of RI professionals,
working closely with our investment teams,
drives the integration of ESG into investment
strategies across the firm and promotes
engagement with investee companies. The
team also ensures that the firm remains up to
date with new developments, opportunities,
evolving regulations and risks related to ESG.
We added to the strength of the team during
the year, hiring a dedicated climate scientist,
research experts, RI specialists and business
management support.
The CS Committee consists of representatives
from the Corporate Sustainability and
Responsible Investing teams, alongside Legal,
Finance, Financial Crime, Corporate Real
Estate and Services (CRES), Communications
and People. Their focus is to identify, review,
manage and monitor sustainability and
corporate social responsibility risks and
opportunities across Man Group, and report
these to the CEO and the Man Group Board.
Risk management framework
Strategic and/or operational ESG risks to
our business, including climate change risks,
are managed in the same way and with the
same level of rigour as other business risks.
For further detail on our firm-wide risk
management processes, refer to pages
34 and 35.
The firm’s control environment manages risks
to investment teams and the organisation as
a whole, in accordance with the Board’s risk
appetite. If there is a breach of risk appetite,
risks will be resolved promptly, in line with the
firm’s procedures and processes.
We dedicate significant time and resource to
ensure we are abreast of regulatory changes,
and we engage regularly with regulatory
bodies. Responsible investing is a complex,
evolving landscape and our dedicated
committees, comprising senior staff from
across the firm, work to address the impact
of changes in ESG regulation on our business
and our investment strategies.
To ensure that we are consistent and credible
in our approach to RI, we have formalised
a monitoring procedure for strategies that
have a defined ESG approach. We monitor
portfolio managers’ compliance with our RI
policies and fund framework (see page 53) on
an annual basis. Additionally, dedicated
investment risk and compliance professionals
monitor ongoing adherence to our RI
exclusions list and other ESG-related
investment restrictions.
Man Group has a public, firm-wide
Environmental Sustainability Policy Statement
to account for our corporate environmental
impact. This policy outlines our commitment
to minimise the environmental impact of our
activities, through responsible use of natural
resources, maximising energy efficiency,
reducing greenhouse gas emissions,
implementing zero waste to landfill wherever
possible, and minimising or recycling waste.
ESG governance structure
Man Group Board
ARCom
RAF
ESG Systems
& Governance
Committee Q
Man Group plc | Annual Report 2023
RI Leadership
Man Group CEO
Responsible Investment Committee1 M
Corporate Sustainability Committee Q
RI Exclusions
Sub-Committee
B
RI Oversight Committee M
Adjudication
Sub-Committee
Stewardship
Committee
A
Q
Meeting frequency
Q Quarterly
M Monthly or more
B Bi-annually
A Ad-hoc
1 Supported by the RI team, including ESG Data Science,
ESG Alpha Tech, RI Research, Stewardship, RI Specialist,
RI Portfolio Oversight and Business Management and
Strategy expertise.
Strategic report | Governance | Financial statements | Shareholder information 48
Sustainability and responsibility continued
Our operations
At Man Group, we seek to act responsibly and sustainably
through our operations.
Carbon net zero commitment
Man Group has committed to achieve net
zero carbon emissions across its operations
by 20301. As such, in 2019 we set firm-wide
targets in line with the Science Based Targets
initiative (SBTi) to limit the global temperature
increase to a maximum of 1.5°C2 above
pre-industrial levels.
To reach net zero, we will reduce the
carbon emissions included within our ‘totals’,
which encompass:
Scope 1
Direct emissions from fuel e.g. gas, oil.
Scope 2
Indirect, market and location-based
emissions from purchased electricity, heat,
steam or cooling for our own use.
Scope 3
Upstream leased assets and business travel.
Wherever possible, we will also take action
to reduce the consumption across all other
indirect Scope 3 emissions categories, as
per the GHG Protocol Technical Guidance for
Calculating Scope 3 Emissions.
Further to our emissions reduction activities,
we maintain carbon neutrality across our
core operations, defined as the market-based
total on page 49, through the use of certified
carbon offsets. We are focused on, and
committed to, reducing emissions but
acknowledge there will be a residual amount
that we cannot eliminate. We support several
carbon removal projects and seek to maintain
a diverse portfolio across different locations.
The projects include: working with indigenous
communities to reduce deforestation from
Eastern Panama to the Colombian Pacific
coast; rainforest protection in Malawi, working
to reduce fuelwood use through providing
fuel-efficient cookstoves thereby helping
Our strategic pathway to net zero
¬ See page 51 for an overview of how we are progressing against our short-term targets.
develop sustainable livelihoods and
increasing community resilience, as well
as promoting biodiversity; and preserving
grassland in Colorado and Montana to
leverage carbon capture as a ‘below the
ground’ carbon sink.
Man Group is a registered supporter of the
TCFD; we include metrics and targets for
the firm in line with the guidance provided
for asset managers (see pages 60 and 61).
During 2023, we were also admitted as a
member of the strategic forum of the TNFD.
As outlined earlier in this section, our
baseline year is 2019, with subsequent
targets measured relative to these baseline
emissions. We review our targets regularly
to remain aligned with the Science Based
Targets initiative methodology in limiting the
global temperature increase to a maximum
of 1.5°C above pre-industrial revolution levels.
2020
2022
2024
2026
2028
2030
All Scopes
Review targets at least bi-annually to ensure we remain aligned with the latest climate science
Move to biomethane and renewable energy supplies where available
Scope 1
Scope
1 & 2
Scope 2 & 3
– upstream
leased assets
Scope 3
– upstream
leased assets
Scope 3
– business
travel
Scope 3
– other
Reduce natural gas and fuel emissions by 30%
Certify our London headquarters to ISO 14001 Environmental
Management System standards
Install and upgrade equipment to ensure efficiency and reduce wastage
Comply with UK ESOS Phase 3 (UK Energy Savings Opportunity Scheme)
Certify our London headquarters to NABERS UK energy efficiency standard
Reduce global energy usage by 20%
Reduce aggregate Scope 2 market-based and Scope 3 (upstream)
leased assets market-based emissions by 50%
Install and upgrade equipment to ensure efficiency, data capture and reduce wastage
Increase the adoption of 100% renewable
(certified) supplies by 25%
Improve the efficiency of our data centres
Non-renewable
energy to supply
<10% of operations
Non-renewable
energy to supply <5%
of operations
Continue to prioritise environmental credentials in the selection of new leased assets
Work with business units in managing their carbon budgets
Further deploy remote working tools to reduce the need for business travel
Join the NZAMI, setting interim portfolio
decarbonisation targets for 2030 across our
investments
Include environmental expectations within our
Supplier Code of Conduct
Prioritise carbon net zero strategies when refurbishing or relocating offices
1 This refers to Scope 1 and 2 emissions; elements of Scope 3 are considered where we have the data e.g. business travel and upstream leased assets.
2 We set firm-wide targets considering the Paris Agreement, an international treaty on climate change adopted in December 2015. The goal of the agreement is to limit global warming to well below
2°C, and pursue efforts to limit the temperature increase to 1.5°C above pre-industrial levels.
Adopt agile working strategies to reduce the need for commuting and overall office space
Man Group plc | Annual Report 2023
Strategic report 49
Greenhouse gas emissions and energy use
Scope 1
Scope 2 location-based
Scope 2 market-based
Scope 3 (upstream) leased assets, location-based
Scope 3 (upstream) leased assets, market-based
Scope 3 business travel
Total (location-based)
Total (market-based)
Energy consumption (kWh, ‘000s)
UK and
offshore
444
914
–
1,304
0
3,331
5,993
3,775
13,011
Global
(excluding UK
and offshore)
3
4
2
322
306
2,468
2,797
2,779
1,197
2023
Total
447*
918*
2*
1,626*
306*
5,799*
8,790*
6,554*
14,208
UK and
offshore
826
803
–
717
0
1,714
4,060
2,540
7,863
Global
(excluding UK
and offshore)
6
8
–
469
446
1,357
1,840
1,809
1,448
2022
Total
832*
811*
–*
1,186*
446*
3,071*
5,900*
4,349*
9,311
* These items are included in the scope of our 20233 and 2022 limited assurance reports4.
The above figures include metrics for the Varagon business that joined Man Group on 7 September 2023. These are not stated separately as they are not considered material.
We retained our Carbon
Disclosure Project (CDP) Climate
Change questionnaire score of B
underlining our commitment to
transparent disclosure and active
management of climate issues.
Our offices
Minimising our environmental impact is a
core component of our real estate strategy
as, given the nature of our business, a large
part of the direct environmental impact of
our operations stems from our real estate
footprint. Across our global office portfolio,
we currently occupy eight buildings certified
by LEED (Leadership in Energy Efficiency
and Design), one by Energy Star and one
by NABERS (National Australian Built
Environment Rating System), accounting
for 86.3% of our global headcount.
Man Group’s largest office, Riverbank House
in London, also has a Building Research
Establishment Environmental Assessment
Method (BREEAM) ‘Excellent’ rating.
Our Energy Performance Certificate (EPC)
rating in our London headquarters continues
at B and during 2023 we engaged in a
‘Building Performance Optimisation review’
of Riverbank House. We are subsequently
implementing various recommendations
which will help reduce our emissions.
We are focused on procuring renewable
energy in jurisdictions in which we have
operational control, and where such supplies
are available. We operate a zero waste
to landfill policy in all jurisdictions where
possible, equating to 90.9% of our operations
(based on headcount).
3 www.man.com/kpmg-carbon-2023.
4 www.man.com/kpmg-carbon-2022.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 50
Sustainability and responsibility continued
Our operations continued
Our systems and projects
We have engaged specialist software to track
and monitor our emissions and environmental
impacts. We engage actively with an energy
services consultancy to help us to mitigate
risk, maximise opportunities and reduce
our carbon footprint. We are focused on
delivering clear and transparent reporting that
monitors the measurable carbon emissions
within our control. As set out in our pathway
to net zero, we are currently working towards
becoming ISO 14001 accredited.
Emissions from operations
The carbon emissions calculations disclosed
in this report are carried out according to
our public Environmental Reporting and
Methodology Guidelines document1 and are
subject to internal checks and controls. Once
again, we have engaged KPMG to provide an
independent limited assurance opinion over
our corporate Scope 1, Scope 2 and Scope
3 (upstream leased assets and business
travel) emissions, in accordance with ISAE
(UK) 3000 and ISAE 3410, and as accepted
by the CDP. The limited assurance report is
available online2, and we recommend that it is
read in full.
Our mandatory global annual greenhouse
gas emissions and energy use reporting is
detailed here pursuant to the Large and
Medium-sized Companies and Groups
(Accounts and Reports) Regulations 2008
as amended by the Companies Act 2006
(Strategic Report and Directors’ Report)
Regulations 2013 and the Companies
(Directors’ Report) and Limited Liability
Partnerships (Energy and Carbon Report)
Regulations 20183.
We include the emissions under the
categories of Scope 1, Scope 2, Scope 3
(upstream leased assets and business travel)
within our total emissions split by our UK and
offshore and global footprints. It is this total
that, in turn, relates to our non-financial
KPI (see page 21) and our executive
remuneration (see page 119).
Our total emissions in 2023 have increased
from 2022, predominantly owing to an
increase in business travel, compounded
by an increase in carbon emission factors.
As we grow our operations and distribution
network, as well as welcome new business
lines and teams to Man Group, we
acknowledge that our staff will need to
travel to our new offices in order to build
relationships with new staff and embed our
culture in those locations. We continue to
focus on reducing travel emissions, and
Man Group plc | Annual Report 2023
carbon travel budgets for each department
are in place. Our annual energy consumption,
measured in kWh, which encompasses
Scopes 2 and 3 (upstream) leased assets
irrespective of source (renewable or non-
renewable), has also increased by 53%.
Our headcount increased by 9% in the
year, which has played a significant part in
the increase in energy consumption.
Our Scope 1 emissions decreased by
46% from 2022, owing to improvements
to the operation of the boiler plant at our
Switzerland offices, which led to a 49%
reduction in natural gas consumption. Our
London HQ also contributed to the overall
Scope 1 reduction in emissions, with a 29%
reduction in diesel usage from our stand-by
generators and a 91% reduction in refrigerant
(F-Gas) loss. Our Scope 1 consumption
continues to track downwards in line with our
targets, as we continue to implement
optimisation control strategies across our
managed portfolio.
Emissions from our Scope 3 upstream
location-based leased assets have increased
by 37% from 2022, owing to a significant
increase in our data centre energy
consumption (69% on 2022), driven by
updating the data collection method in
2023 to capture the energy use of shared
infrastructure at our UK data centres.
Market-based emissions stemming from
upstream leased assets have decreased by
31%, owing to a combined reduction of 21%
in energy consumption, which is mainly due
to relocation of offices with better energy
credentials and improved office operation.
We also disclose our reporting emissions
as an intensity metric, which enables us to
monitor emissions independently of changes
in the scale of our business activities. We do
this because Man Group is a people-centric
business; as noted above, changes to
headcount impact the real estate we occupy,
and the level of business travel we conduct.
Intensity metrics
tCO2e
Total FTE4
Scope 1
Scope 2
location-based
Scope 2
market-based
Scope 3 (upstream) leased
assets location-based
Scope 3 (upstream) leased
assets market-based
Scope 3 business travel
Total (location-based)
Total (market-based)
2023
1,704
0.26*
2022
1,558
0.54*
0.54*
0.52*
0*
–*
0.95*
0.76*
0.18*
3.41*
5.16*
3.85*
0.28*
1.97*
3.79*
2.79*
* These items are included in the scope of our 2023 and 2022
limited assurance reports.
As we source more data to actively manage
our total emissions, we continue to make best
efforts to address the breadth of those within
Scope 3. We have obtained emissions data
for our corporate investments, downstream
leased assets, waste and water. We continue
to explore using estimated and implied data,
for example for procurement activities, staff
commuting patterns and their teleworking
footprint, but are committed to using actual
data for reporting.
Further Scope 3 estimates
tCO2e
Emissions from
investments
Downstream leased
assets,
location-based
Downstream leased
assets,
market-based
Waste and water
Methodology
2023
2022
51,014
61,056
179
111
385
2
267
6
Approach
At all locations where Man Group is
responsible for the utility costs, our Scope 1,
2 and 3 leased assets emissions data is
gathered, validated and reported on using the
GHG Protocol – A Corporate Accounting and
Reporting Standard (2015), as our framework.
Throughout our disclosures we use
the operational control approach to our
greenhouse gas inventory and reporting
boundary, excluding consultants, outsourced
service providers and joint ventures.
We apply the latest UK Government’s
Greenhouse Gas Conversion Factors, the
Department for Environment, Food and Rural
Affairs (DEFRA) and IEA (International Energy
Agency) emission factors. Based on the
nature of our emissions and the consistency
month-on-month, we believe this is an
appropriate representation of Man Group’s
global annual emissions.
For the purpose of GHG reporting, we use a
hierarchy of data sources that starts with an
actual invoice, metered or reported data
sources. If these sources are not available,
we consider using estimates, prior year or
extrapolated data in a stepped process that
considers seasonality to provide the most
accurate results.
1 www.man.com/environmental-guidelines.
2 www.man.com/kpmg-carbon-2023.
3 Man Group plc (as Jersey incorporated) is not itself
subject to these regulations but is reporting in accordance
with them as it has UK subsidiaries that fall within the
regulatory scope.
4 For the purposes of our environmental reporting we have
only included permanent or fixed-term contractors (we
exclude consultants and third-parties).
Strategic report Short-term targets and actuals
tCO2e
Scope 1: Reduce Scope 1 natural gas and fuel emissions by 30%
Scope 2 & 3 (upstream) leased assets location-based:
Reduce global energy usage by 10% per year
Scope 2 & 3 (upstream) leased assets market-based:
Reduce emissions by 50%
2019
Baseline
1,136
4,253
464
2023
Target
772
2,896
386
2023
Result
447
Met
2,544
Met
308
Met
51
2024
Target
749
2,809
367
We define materiality as the magnitude
of triviality for misstatement in our carbon
emissions reporting. The materiality threshold
we use is 5% of the total of each emissions
Scope. We will report corrections to
emissions differences of more than 5% of the
total of each emissions Scope, if they occur,
as well as differences below that threshold
that, in our view, warrant restating to ensure
transparency and accuracy of our emissions
reporting and strategic pathway to net zero
targets within our Annual Report.
Scope 1 and 2
Emissions under the Scope 1 category
include the direct emissions stemming from
the combustion of gas and oil, for example
through the use of back-up generators during
power failures and testing scenarios.
Scope 2 emissions encompass the indirect
emissions stemming from purchased
electricity. As the buildings over which we
have operational control use 100% renewable
energy, the emissions are considered
location-based and our market-based
emissions in this category are negligible.
We do not include emissions relevant to
locations that are out of our reporting
boundary, such as the offices of third-party
contractors.
Scope 3
We intend to account for and minimise
the carbon footprint of our entire business,
including our direct emissions, as well
as upstream and downstream Scope 3
emissions as defined by the GHG Protocol
Corporate Value Chain (Scope 3) Accounting
and Reporting Standard. Emissions
stemming from business travel such as
flights, rail, taxis and hotel stays have been
ascertained through our third-party preferred
travel partners.
We disclose emissions relating to our
Riverbank House sub-tenants under the
downstream leased assets category. In some
instances, the environmental improvements
we make also impact the emissions for our
sub-tenants. Environmental considerations
from our global office operations, over which
we do not have operational control, are
reported under the upstream leased assets
category. All procurement and leasing
negotiations across our global real estate
have a focus on steps that can be taken to
reduce the associated environmental impact.
Water for air conditioning, data centre cooling
systems, kitchens, cafés, indoor plants,
sanitary installations and external grounds/
gardens is measured in cubic metres and is
converted into tCO2e using UK Government
GHG conversion factors.
Waste consumption from business activities,
which includes paper/cardboard, residual
waste/domestic-type waste, electronic scrap,
cafeteria (food) waste, etc., is measured in
tonnes and is converted into tCO2e using UK
Government GHG conversion factors.
In 2021, for the first time, we disclosed the
emissions stemming from our corporate
investments under the ‘Emissions from
investments’ category. In 2023, this
disclosure encompasses 50% of our seed
capital and 98% of our fund investments held
for deferred compensation awards. This is
calculated using the same methodology as
the carbon disclosure of our AUM, which is
aligned with the TCFD recommendations, as
described on page 60.
Performance against targets
We strive to embed environment-related
commitments throughout our organisation,
and as such these targets feed into our two
carbon-related non-financial KPIs (see page
21). These metrics are also linked to executive
compensation.
We met all of our targets in 2023, as shown in
the table above. In 2022, we only achieved our
Scope 2 and Scope 3 (upstream) location-
based leased assets target, due largely to the
unforeseen mechanical issues we experienced
with some of the chiller units at our London
headquarters. Subsequently, we did not
achieve our Scope 1 emissions reduction
target in 2022; however, with the controls put
in place to reduce the risk of this reoccurring
in 2023, we were able to more than meet this
target in the year.
Although our average global headcount
increased in 2023, including the headcount
growth from the acquisition of Varagon
Capital Partners in September 2023, we
were still able to achieve our emissions
targets through a focus on improvements
to the plant operation at our London HQ and
Switzerland offices and the continued drive
to transition more of our global offices to
renewable energy where possible. In 2023,
for example, we commissioned a Building
Performance Optimisation Audit, where
several opportunities for energy reduction
were identified. To date, 60% of these
suggestions have been actioned. We
anticipate further improvements resulting
from our current ISO 14001 gap analysis
and work towards accreditation in 2024.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 52
Sustainability and responsibility continued
Investing responsibly
Our mission is to apply a data-driven approach to
meet the sustainable investment goals of our clients.
As an asset manager and investor, our
overarching goal is to maximise long-term,
risk-adjusted investment returns for
our clients.
We recognise that there is no single
approach to responsible investing and
that each of our clients has different ESG
needs. Accordingly, we seek to leverage the
breadth of skills and experience at the firm,
in particular our quant, research and data
science expertise, to deliver better outcomes
for our clients. Our multifaceted approach
allows us to see things differently and
our vision is to be a recognised leader in
providing RI solutions to investors globally.
We understand the importance of sound
stewardship in managing investors’ capital,
and our approach to RI ensures that our
interests and values are closely aligned
with those of our clients and shareholders.
Our commitment to RI spans five core areas:
1. Integrating ESG concepts in our
investment strategies.
2. Conducting cutting-edge quant,
academic and thematic RI research
to source alpha for our clients.
3. Using our data science expertise to
analyse, innovate and apply ESG
datasets.
4. Stewardship of our client assets.
5. Education and advocacy to advance
the science of responsible investing.
Across these five spheres, we aim to lead
the way in advancing the science behind
responsible investing.
We will always respond to the
needs of our clients. We recognise
that our clients may have different
investment priorities, and we
deploy robust, high-quality RI
techniques to support investment
objectives where clients have
sustainable investment goals.
Carol Ward | Head of Solutions
ESG integration and strategies
We view ESG as a natural complement to traditional financial analysis resulting
in a more comprehensive view of a company’s long-term prospects.
RI Research
Quant, academic and
thematic research
underpins our approach to
RI. We specialise in climate,
decarbonisation and impact
research, internally and
through collaboration
with academic and
scientific institutions.
Data
We approach the
implementation of ESG
factors with scientific rigour,
staying true to the data and
ensuring robust methodology.
Stewardship
As stewards of our clients’
capital, we actively and
responsibly manage their
assets to unlock long-term
and sustained value.
Education and
advocacy
We are committed to
promoting and raising
awareness of RI within the
firm and more widely across
the investment industry.
¬ See page 54
¬ See page 55
¬ See page 57
¬ See page 59
Man Group plc | Annual Report 2023
Strategic report 53
Our
commitment
to net zero:
a) As a NZAMI signatory, we have set a
portfolio decarbonisation reduction
target of 50% reduction in emissions
intensity by 2030, compared with a
baseline WACI as at 2019, on 41% of
our AUM (as at 31 March 2022).
b) We monitor progress against our
NZAMI target and report annually via
the UN-backed PRI.
c) We are reviewing our interim target
with a view to updating the portion
of our AUM in line with the NZAMI
recommendations and the evolving
requirements of our clients. Any
changes to our interim target will
be available in our 2024 PRI report.
We are pleased to report a significant
reduction in the WACI for our AUM
subject to NZAMI interim targets,
compared with our 2019 baseline and
we will continue to focus on this in the
years ahead.
Managing climate-related risk
in our portfolios
We recognise that our clients have
different investment priorities and, in
fulfilling our duty, we consider ESG
factors that support their unique
investment objectives.
Where it is consistent with our client’s
mandate, we seek to manage climate
integration risks alongside other
financially material ESG factors, just
as we manage all other relevant
investment risks. Within our broader
climate framework, we focus on four
key areas: the physical cost of climate
change, the transition cost of moving
to a decarbonised global economy, the
stranded fossil assets left behind, and
the opportunities of a greener world.
We disclose the WACI for a number of
our key strategies on page 61.
ESG integration and
strategies
At Man Group, we believe that material
ESG-related risks and opportunities can
impact long-term value creation for the
companies in which our funds and
mandates invest. In our approach to RI,
we seek to manage financially material ESG
factors alongside other investment risks.
We believe that ESG complements
traditional financial analysis, resulting in a
more comprehensive assessment of a
company’s long-term prospects.
In the past, ESG investing has lacked a clear
definition; at times, it has been perceived as
a qualitative process as opposed to a true
investment factor and we believe that is
changing. We have taken a quantitative
approach to building our understanding of RI
and we have used this knowledge to develop
an uncorrelated ESG factor to determine real
ESG performance attribution.
As a diversified asset manager, we strive to
be a leader in RI across all asset classes
and investment styles. The breadth of Man
Group’s investment engines means that
the firm represents a unique intersection of
perspectives – quantitative and discretionary,
macro and multi-strategy, liquid or private
markets – where competing expectations
and applications of ESG are actively debated.
We actively work to cultivate a range of
approaches to identify and address ESG-
related risks and opportunities.
We continue to be thought leaders in the
application of RI to less explored areas. For
example, within financial instruments (such as
commodity futures) or within non-traditional
asset classes (such as private credit, or real
estate). This enables us to add meaningfully
to the development of RI, in particular on the
quantitative side but across our discretionary
strategies too.
Our diversified range of alternative and
long-only strategies seeks to apply the best
practices of RI in the way that is most relevant
to their fields of research, and we expect our
investment engines to apply the norms and
best practices of RI that are most appropriate
for their strategy and asset class. We
believe that RI is best addressed through a
combination of top-down and bottom-up
approaches. Although we have a unified
approach to RI across our firm with respect to
organisation, policy frameworks, stewardship,
analytics platforms and participation in
industry activities, we do not impose a single
house view. We actively and intentionally
cultivate a decentralised approach when
it comes to ESG integration across our
investment teams and strategies.
Man Group’s culture of innovation means
that we are always exploring opportunities to
improve processes across our business. Our
unique combination of extensive quant and
discretionary experience in the fundamental
analysis of E, S and G issues allows us to
integrate RI concepts across a range of asset
classes and investment strategies we offer.
Our firm-wide RI Fund Framework is a
proprietary ESG classification system,
separate to regulatory classifications, which
is used to establish a baseline requirement of
ESG standards across all Man Group’s funds.
The RI Fund Framework aims to establish
coherent ESG categorisation across our
offering, as shown below:
Increasing
levels of ESG
integration
Man Group Sustainable Range
Strategies that were developed
with an ESG-specific mandate
Man Group RI Informed
Strategies that incorporate some
degree of ESG analysis into
investment decision making
Man Group Base Standard
Strategies that apply Man Group’s
firm-wide exclusions and support
our stewardship activities
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 54
Sustainability and responsibility continued
Investing responsibly continued
ESG-integrated AUM
More specifically:
As at 31 December 2023, $59.3 billion of Man
Group’s total AUM incorporates ongoing
consideration of ESG factors within the
investment analysis and decision-making
process with the aim to improve risk-adjusted
returns.
To provide a consistent framework for
our calculation of ESG-integrated AUM,
we use the latest Global Sustainable
Investment Alliance (GSIA) investment
approach and definitions. Our ESG-integrated
AUM metric is based on the GSIA’s current
‘ESG Integration’ investment approach,
which, following an update in 2023, is defined
as the ‘ongoing consideration of ESG factors
within an investment analysis and decision-
making process with the aim to improve
risk-adjusted returns’. In this context, the
use of ESG factors for ESG integration
may be less significant than other factors
in the investment selection process. The
ESG integration investment approach
is relevant and applicable to Man Group’s
investment process and its use has been
approved by our Responsible Investment
Committee (RIC).
Under this approach, our calculation
methodology identifies all relevant funds
and mandates for which explicit ESG
criteria are used in asset selection
(for discretionary investment strategies)
or where a dedicated ESG model is
incorporated in the investment process
(for systematic investment strategies).
• For single manager/strategy funds: if ESG
factors are materially integrated into the
investment strategy (e.g. ESG factors
impact security selection1), then the entire
assets of the fund will be accounted for as
ESG AUM. In the case of Man Numeric, it
will be relevant to the integration of Man
Numeric’s proprietary ESG factor model2.
• For ESG multi-strategy funds and/or
mandates (e.g. strategies which are
marketed as ESG strategies): we include
all the relevant AUM.
• For non-ESG multi-strategy funds and/or
mandates: currently only the portion of a
fund or mandate for which ESG is factored
into the investment process is included3.
• For third-party multi-strategy managers:
we will seek to assess at the sub-strategy
level for ESG-integrated AUM on the same
basis. If we are unable to get transparency
or single sleeve allocation is not disclosed,
those strategies will be assumed to not
include ESG content.
The calculation of Man Group’s ESG-
integrated AUM is undertaken by our RI team,
reviewed by the relevant investment teams,
and subject to formal oversight by multiple
control functions. This rigorous process
and the resulting ESG-integrated AUM figure
are governed by the RIC. We have used
this approach consistently since we started
publishing Man Group’s ESG-integrated
AUM and while we believe we have
a prudent framework for the calculation,
we continue to monitor the development
of best practice methodologies.
RI research
Our commitment to high-quality research
extends to ESG. Our RI team has dedicated
specialists who provide insight into specific
ESG topics and pursue a diverse agenda of
thematic research in collaboration with our
investment teams, with a specific focus on
climate, decarbonisation and impact. Our
goal is ultimately to find practical research
outcomes that lead to improved ESG
integration in our investment strategies
and stewardship practices.
In recent years, we have advanced
our understanding of climate risks and
opportunities through ongoing efforts and
initiatives in this space. We are investing
significantly to enhance our approach to
managing climate change risks and believe
that our data-driven research culture puts
us in a prime position to assist our clients
in reducing the systemic risk of climate
change whilst identifying opportunities in the
transition towards a low-carbon economy.
For example, Man Numeric, in
collaboration with the RI team and our
two dedicated climate scientists, has
leveraged its climate expertise and
quant research capabilities to develop
a multifaceted climate alpha model that
explicitly incorporates views of the potential
risks and opportunities related to climate
change into their investment processes.
November RI Summit
A data-driven approach to a
sustainable future
We were excited to hold our first
Responsible Investment Summit at
Riverbank House in London in November,
where we discussed how a data-driven
approach can help investors to help
create a more sustainable future. The
day included a series of presentations on
topics including: a data-driven approach
to biodiversity considerations, sustainable
housing in the UK, the relationship between
climate news and investment opportunities,
and how to build a systematic, sustainable,
climate-focused, multi-strategy portfolio.
The summit also included an engaging
panel discussion led by Robert Furdak
on how to address some of the hardest
questions in responsible investment and
concluded with a live recording of the
podcast ‘A Sustainable Future’ featuring
our Head of RI Research, Jason Mitchell,
and Tom Gosling, Executive Fellow of
Finance at London Business School.
Man Group plc | Annual Report 2023
1 For example: Article 8 and Article 9 Funds under the
Sustainable Finance Disclosure Regulation or where the
ESG factor is considered for every single security selection.
2 Which may be as low as 5% in terms of weight compared to
the other models.
3 For example, some of our multi-strategy/multi-asset
portfolios may only incorporate ESG factors in certain
sleeves or asset classes. For such strategies/portfolios,
we only include the portion of the strategies/portfolios for
which we integrate ESG factors into the investment process.
Strategic report 55
We have spent considerable time reviewing
and understanding the processes of leading
ESG data vendors, and believe that creating
a better measure of ESG relies on four
key ideas:
1. Using a principles-based approach
that focuses on economic intuition
and academic literature.
2. Spending time to understand vendors
and their processes so we can present
the most appropriate combinations to
our clients.
3. Applying careful normalisations
and adjustments to regions, sectors
and industries.
4. Understanding what unintended factor
exposure existing ESG signals contain,
in order to make our ESG factor as
orthogonal as possible.
The result is an approach that identifies
companies making thoughtful long-term
decisions. The scores we calculate are
available to all our investment managers as
part of our proprietary ESG analytics tool.
By looking at disparate sets of ESG data
using this approach, we can turn the
off-the-shelf variables into more useful and
informative signals. Our efforts have given us
a strong understanding of our data providers
and provide a strong platform from which to
monitor changes to their methodology.
Man Group
Carbon Dataset
The Man Group Carbon Dataset is an
internally curated dataset created to unify
carbon data from multiple data providers
into one single source. This centralised
dataset contains all licensed carbon data,
with the latest versions of the data from the
underlying vendors. This offers a number of
advantages, including:
• Centralised monitoring and quality control.
• Higher coverage than any
individual vendor.
• Standardisation to aid comparability
between vendors.
• A proprietary overlay that aims
to reduce vendor errors and estimation
model outliers.
We are also exploring how to enhance
our existing environmental efforts by
incorporating biodiversity and nature-related
considerations, specifically corporate
impacts and dependencies on nature, into
our investment processes and stewardship
practices. We are evaluating biodiversity
frameworks, datasets and methodologies,
and engaging actively with data providers
to trial data with the aim of licensing data
to assist with managing biodiversity risks,
providing transparency to investors and
informing engagements with companies.
Further, Man Group’s Stewardship team
has joined the FAIRR Initiative’s biodiversity
engagement (focusing on waste and pollution
management) and is looking to enhance our
stewardship work on nature considerations.
In 2023, Man Group was admitted to the
strategic forum for the TNFD. The TNFD
Forum is a global and multi-disciplinary
consultative group of institutional supporters
who share the vision and mission of the TNFD
and have indicated a willingness to make
themselves available to contribute to the
work and mission of the Taskforce.
At Man Group, we recognise that
collaboration with academic and industry
experts is key to our research initiatives.
We have recently partnered with Columbia
University to conduct research on
frameworks for decarbonisation and
reporting. Our joint research with the
academic experts at Columbia will aim to
produce a more refined decarbonisation
framework, bringing rigour and greater
standardisation when calculating the climate
impact of public market securities. We
plan to hold our first on-campus research
symposium in 2024, to discuss and refine
the proposed decarbonisation framework.
Data
A quantitative approach
to ESG data
We believe our quantitative capabilities
provide a unique position with which
to interpret, analyse and apply ESG
datasets. We have used this knowledge
to develop an uncorrelated, orthogonal
ESG factor for real ESG performance
attribution, applying this to a number of
investment strategies at Man Group.
As a data-driven firm, we believe in providing
our teams with as much high-quality ESG
data as possible. Thus, we subscribe to
leading ESG data providers as well as
conducting our own proprietary research.
Processing ESG data is a complex and
nuanced exercise; it requires applying data
science techniques to clean, analyse and
gain insights from multiple data sources.
With over 675 quants and technologists
at the firm and more than 35 years of
experience in quantitative investing, including
several years spent interrogating ESG
datasets, we believe we are in a prime
position to leverage our skills to understand
nuanced and non-standard ESG datasets.
Truly understanding ESG data
We approach the implementation of ESG
factors with the same scientific rigour and
caution we would apply to any investment
risk or opportunity, staying true to the data
and ensuring that we have a robust
methodology in place.
ESG data has matured over the last decade,
and we are entering a phase where the
data has both a long-enough history and
broad-enough coverage to make it valuable
to quantitative investment firms. However,
unlike traditional quantitative factors sourced
from financial statements and exchange data,
ESG data is often qualitative, discretionary
and unregulated. Some datasets have a short
history, many are collected retroactively, and
each vendor’s approach has inherent biases.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 56
Sustainability and responsibility continued
Investing responsibly continued
Our proprietary ESG tools
In recent years, we have leveraged our quant
expertise to build a number of proprietary
ESG tools that power our data-driven
approach to responsible investment. In 2023,
we continued investing in our ESG tools to
expand and refine them.
Our ESG tools have been developed internally
under the direction of our RI specialists and
Stewardship team, with extensive input
from our investment engines and close
collaboration with our technology and
investment analytics teams. The
sophisticated design and capabilities of
each tool highlights the firm’s collaborative,
technology-driven culture, and helps us to
achieve our purpose: to assist our clients in
meeting their investment objectives.
ESG analytics tool
The Man Group ESG analytics tool embeds
our proprietary ESG scores alongside
multiple datasets and standardises ESG
reporting for our investment teams and
our clients.
This tool provides an innovative, standardised
approach to managing ESG risks and
opportunities. It is a proprietary, dashboard-
style tool enabling the firm’s investment
teams and clients to monitor non-financial
risks and analyse ESG factors on a single-
stock, portfolio and index level. In addition
to the issuer-level dashboard, the tool also
features a carbon dashboard (showing
key carbon metrics) and a stewardship
dashboard (providing an overview of a
portfolio’s stewardship activity).
GAIA (Global Active Issuer Assessment)
tool
GAIA is a proprietary, firm-wide tool to view
issuer-level ESG-related data and identify
sustainable investments. GAIA provides a
systematic ‘one stop shop’ for a range of
ESG data points. It supports ESG integration
into the investment process and in meeting
certain ESG regulatory requirements, such as
SFDR and the EU Taxonomy. GAIA provides
ESG insights into over 26,000 companies
(significantly more than any individual ESG
data vendor), allowing our investment teams
to access a real-time view of the ESG ratings
for portfolio holdings.
Engagement tool
We have developed an internal engagement
platform that allows our investment and
stewardship teams to review, record and
monitor company engagements on ESG-
related matters.
Man Group plc | Annual Report 2023
There is also a significant data challenge. Vast
quantities of data are available, but the real challenge
is being able to meaningfully link corporate and
nature data to identify both risks and opportunities.
The nature data we receive from vendors tends to
be estimated and is subject to the inherent biases of
each vendor’s approach, and we need to analyse,
innovate and apply the nature datasets effectively.
Lastly, it’s clear that many investors are still getting to
grips with other key themes within ESG, such as the
impact of climate transition on their portfolios, making
it hard for them to also prioritise nature given
resource constraints and competing priorities.
Q: What is Man Group doing to address
these challenges?
A: At Man Group, given our years of experience in
interrogating datasets, we are very well placed and
resourced to analyse and understand the nuanced
and non-standard nature-related datasets available.
We are leveraging our expertise in data science
to trial and critically compare multiple datasets to
identify the highest quality, most insightful data. We
can also apply our approach to climate modelling to
nature (for example, by applying our geospatial work
for climate, to nature). There is considerable overlap
between the themes of climate and nature and
with dedicated climate scientists, we have strong
in-house expertise.
However, we know we don’t have all the answers, so
we work extensively with leading academic experts
(for example, through our partnership with Columbia
University’s Department of Ecology, Evolution and
Environmental Biology). We cannot address complex
global challenges such as biodiversity loss without
cross-collaboration and working with scientists to
ensure a credible approach. Third-party collaboration
is a key part of our approach.
Q: What is the future for biodiversity/nature
from an investment perspective?
A: We are only at the start of the journey to
understand the intersection of asset management
and nature. The more we can understand how
our investments interact with nature, the better
positioned we will be to manage the risks and
identify the opportunities on behalf of our clients.
For example, understanding the repercussions
for companies of depleted ecosystems, such as
decreased flood and storm protection that nature
will provide, will be critical as the frequency and
magnitude of extreme weather events continue to
rise. In addition, as investors we should be seeking
to identify the future ‘leaders’, the companies that
are actively trying to provide innovative solutions to
protect and restore nature.
In terms of reporting and transparency, asset
managers need to understand the impacts of our
investments on nature and be able to report that
to investors. Finally, it is critical that, through active
engagement, investors have the capability to
collectively influence issues such deforestation,
land-use change, pollution and other drivers of
biodiversity loss.
Q&A
Jess Henry
RI Specialist, Man Group
Q: Please tell us about your area of expertise
in the RI team at Man Group.
A: As a Responsible Investment Specialist at
Man Group, my role is to act as an adviser to three
constituencies: our investment teams, our sales
professionals, and our clients. In practice, this
includes research and thought leadership on key
ESG topics, to further ESG integration into our
investment strategies in line with our clients’
mandates. Over the last 18 months, one of my
key research areas has been biodiversity loss and
broader nature considerations – particularly how
investors can quantify and monitor the corporate
impacts of, and dependencies on, nature.
Q: Why is biodiversity (and nature more broadly)
an area of focus for Man Group and its clients?
A: In recent years one of the areas of research that
we have specialised in is climate modelling. There
is now a growing awareness that we cannot solve
climate change without also addressing nature loss
– they really are ‘twin crises’. This realisation has
led to increasing global focus on the nature theme,
including (i) the adoption of a Global Biodiversity
Framework during COP15 in 2022; (ii) the launch
of the Task Force on Nature-related Financial
Disclosures in 2023; and (iii) the emergence of
nature-related stewardship initiatives, such as
Nature Action 100+. Over time, we think that nature
depletion will be an increasingly material risk that can
impact long-term value creation for the organisations
in which our funds and mandates invest. As we
continue to deplete nature, companies will be
more exposed to physical risks arising from their
dependence on ecosystem services (the goods
and services provided by ecosystems to humans).
Companies will also be increasingly exposed to
non-physical risks as nature-related policies and
regulations develop.
Q: What are the challenges for investors trying
to integrate nature considerations in their
investment portfolios?
A: The sheer complexity of the issue is the first
challenge. Significant knowledge and resources
are required, and we cannot simply rely on a
single metric to capture either corporate impacts
or dependencies on nature. As an industry,
we need to work collaboratively to address this
complex challenge and find ways to effectively
manage nature-related risks and identify
investment opportunities for our clients.
Strategic report 57
Stewardship
At Man Group, we understand the
importance of sound stewardship in
managing investors’ capital.
The template for stewardship across
alternative asset classes and investment
styles remains poorly defined in the asset
management industry. We are addressing
this by adopting a top-down approach to
stewardship, so that initiatives undertaken
at the firm level filter down to individual
investment engines. Our firm-wide approach
to stewardship recognises some of the
challenges inherent in quantitative strategies
and seeks to create a structure where best
practice at a fund-level is centralised and
then adopted firm-wide.
Our stewardship activity is further guided
by our commitment to the UK Stewardship
Code and our Engagement Policy, which is
set by our Stewardship team and outlines our
approach to shareholder engagement and
proxy voting.
In 2023, we advanced our stewardship
efforts further. We have made continued
and significant progress in the collaborative
engagement space, with Man Group’s
Stewardship team winning Environmental
Finance’s ESG Engagement Initiative of the
Year (Asia) for the first institutional investor-led
climate resolution in Japan. Man Group
worked as part of an investor group alongside
the Australasian Centre for Corporate
Responsibility (ACCR), which co-filed three
resolutions at a Japanese electric utility
company. This represented the first climate
shareholder proposals ever filed in Japan
by an investor group and was the result of
several months of collaboration with the
co-filing group and engagement with the
company. The engagement continued at the
second successive annual general meeting
(AGM) in 2023, again receiving significant
shareholder support, sending a clear
message to the investor community about
concerns over the company’s
decarbonisation strategy. Other significant
collaboration projects include our climate-
related shareholder resolution for the AGM
of a European oil major, which we co-filed
alongside 16 other investors.
As a result of our voting record, our efforts
were ranked by ShareAction in its report
‘Voting Matters 2023’. We ranked ninth out
of 69 asset managers supporting resolutions
on environmental and social matters; this
recognition reflects the strength of our
stewardship approach and how we
consider our voting action an important
factor in driving change.
Man Group plc | Annual Report 2023
Our centralised Stewardship team undertake
the firm-level voting and engagement,
both directly with investee companies and
collaboratively with other investors. Direct
engagement is driven by the Stewardship
team’s focus themes and in response to
company-specific events; collaborative
engagement is dependent on opportunities
arising from the wider investor community.
Engagement at the fund-level is discharged
to the relevant investment team to undertake
at their discretion. The approach specifically
extends across three distinct dimensions:
1. Firm-level voting and engagement
Firm-level voting and engagement is led
by Man Group’s Stewardship team, which
oversees all proxy voting and engagement
activities at the firm level. By engaging with
the companies we invest in on behalf of our
clients, we can improve our understanding
and aim to protect and enhance the value of
the investments we make.
We believe that maintaining high standards
of corporate responsibility has the potential to
protect and enhance investment returns. Our
investment process therefore seeks to assess
this on an initial and ongoing basis and
monitor and engage with investee companies
over time to promote good governance. To
leverage Man Group’s scale and aggregate
ownership in securities, our engagement
activity is consolidated at the firm level.
Progress during 2023:
• Active engagement using quantitative and
qualitative analysis.
Progress during 2023:
• We have made significant progress
on our collaborative engagement
initiatives including:
− UN PRI’s Advance, which looks to
advance human rights and positive
outcomes for people through
investor stewardship;
− Ceres’ Valuing Water Finance Initiative,
an investor-led effort to engage
companies with a high-water footprint
with the goal of helping protect water
systems; and
− ShareAction’s Long-term Investors in
People’s Health (LIPH), a collaborative
engagement initiative with the goal of
addressing elevated and preventable
financial risk linked with worker,
consumer, and community health.
• We continue to work with additional
engagement groups such as the Investor
Forum, which we have been a member of
since 2019. The Investor Forum seeks to
position stewardship at the heart of
investment decision-making by facilitating
dialogue between investors and UK listed
companies, working to create long-term
solutions and enhancing value. Examples
of companies engaged include the UK
listed water utilities companies and several
FTSE 100 companies.
• We are proud to have expanded our work
to encourage the decarbonisation of the
Japanese steel sector through several
engagement groups coordinated
by ACCR.
• UK Stewardship Code signatory, for the
3. Fund-level engagement
third successive year.
• ShareAction Voting Matters Report –
ranked ninth out of 69 asset managers.
2. Collaborative engagement
The second dimension is collaborative
engagement with other institutional investors
and organisations to engage with companies
on ESG-specific issues. We see merit
in collaborating on RI and ESG-related
standardisation through investor groups
and initiatives, and in working with other
investors to address collective concerns and
achieve positive outcomes. We believe that
engagement activities should go beyond
company-specific meetings to address
some of the broader themes relevant to the
markets in which we invest. From combining
shareholder power and maximising influence,
to sharing resources and expertise, we
recognise the benefits of different forms
of engagement and the advantages of
working collaboratively.
Fund-level engagement is a focus for the
firm’s discretionary investment strategies.
In this area, Man Group discharges its
stewardship responsibilities primarily through
company interactions and active engagement
undertaken by our discretionary investment
teams who perform fundamental investment
research. This allows us to build close
working relationships with corporate
management teams to drive change.
Other investment engines at Man Group
also leverage these efforts.
Progress during 2023:
• Following the development of our
proprietary engagement tool in 2022,
this year our investment and stewardship
teams were able to review, record and
monitor ESG engagements with portfolio
companies. Further, we continue to
enhance the framework that defines our
fund-level engagement work, and seek
to undertake long-term, issue-specific
engagements with fund holdings.
Strategic report | Governance | Financial statements | Shareholder information 58
Sustainability and responsibility continued
Investing responsibly continued
Proxy voting
We recognise the importance of using our
voting rights to encourage sound corporate
governance practices at our investee
companies, voting in line with outcomes that
are aligned with the best long-term interests
of our clients. We update our voting policy
and guidelines annually to ensure they
meet evolving best practice and investor
expectations. Man Group’s dedicated
Stewardship team oversees all proxy voting
activity at the firm level. The team works
with a third-party proxy adviser that provides
research and recommendations based on
the firm’s voting policy. We use this as the
basis for our decision and complement the
adviser’s custom recommendations with our
own research.
In 2023, we strengthened our Proxy Voting
Policy in three key areas: climate (including
say-on-climate resolutions to encourage
companies to consult shareholders about
their climate strategies and net zero action
plans), diversity, and human rights.
Our aim is to vote at all meetings for our
holdings where we have the legal right to
do so. Man Group generally actively votes
on every holding in client portfolios unless
otherwise restricted within separately
managed client accounts, there is a situation
where the client retains voting rights or we
are limited because of exposure to synthetic
instruments. Where a separately managed
account exists, or where voting rights have
been retained by the client, we also refrain
from engaging on these positions.
We are seeing heightened
shareholder scrutiny of
climate transition plans and
the Man Group Voting Policy
reflects this. In addition, we
welcome our clients holding
us increasingly accountable
for stewardship activities.
Lewis Naylor | Investment Stewardship Analyst
Man Group plc | Annual Report 2023
Most common topic of engagement
Human
rights
Number of companies engaged
77
Engagement by ESG category
Direct engagement
Number of companies engaged
51
Number of countries covered
17
Collaborative engagement
Number of companies engaged
27
Environment
Social
Governance
31%
31%
38%
Firm-level engagement conducted by
Man Group’s Stewardship team. Excludes
selective and active company engagement at
the sub-group level. For more information
on our proxy voting please refer to our
Global Proxy Voting Summary Report
available on our website.
Meetings voted
6,656
Proposals voted
68,453
approx. 98% of votable shareholder meetings
approx. 97% of votable items
Engagement case study
Region:
Asia and Pacific
Sector:
Materials
Summary
Topic:
Climate change
Objective
To secure a commitment from the
company to strengthen its emissions
reduction target.
An investor group comprised of
Man Group, Storebrand, Corporate Action
Japan and coordinated by ACCR engaged
with the company ahead of its AGM.
After months of engagement, the
shareholder group welcomed the
company’s announcement of enhanced
climate commitments. The company
worked constructively to improve its
ambition in relation to building knowledge
internally for the shift from a blast furnace
to an electric arc furnace steelmaking
process. Further, a company statement
that a stable supply of green hydrogen and
green power (renewable energy) is needed
as a key input to achieve its target of
carbon neutrality was welcomed.
Strategic report 59
Q&A
Jason Mitchell
Host of Man Group’s ‘A Sustainable
Future’ podcast
Q: 2023 was the sixth year of Man Group
hosting the ‘A Sustainable Future’ podcast
series – what purpose does it serve and
what do you think has kept the podcast
so popular?
A: The podcast is an open, educational
resource for everyone interested in discovering
approaches to sustainability and responsible
investment; it explores the work we are doing
across society today to build a more sustainable
future. Within that, we ensure a wide discourse
across all dimensions of sustainability and are
ranked globally in the top 2% of all podcasts.
The combination of reach and diversity of
thought has meant our audience is a real mix
of institutional investors, policymakers and
multilateral organisations, as well as academics
and students.
Q: What are the core themes of the series?
A: Some of the key themes include sustainable
finance regulatory and policy change, the energy
transition and climate security, and academic
examinations of sustainable investing. Over 2023,
we have also had some incredibly interesting
conversations on topics including the linkage
between AI and Labour Productivity, as well
as Planetary Boundaries. ‘A Sustainable Future’
acts as an important tool in Man Group’s
approach to RI education and advocacy;
discussing both the things we, as a society, are
doing to build a more sustainable future and also
the challenges we face.
Q: What is next for 2024?
A: We have produced over 80 episodes over
the last five years. In 2024, we want to continue
growing the podcast audience, delving further
into topics within sustainability and RI, whilst
maintaining the high-quality discussions and
guests that the podcast is recognised for.
Education and advocacy
We are committed to promoting and
raising awareness of RI within the firm
and across the investment industry; this
involves promoting education and setting
standards through participation in industry-
wide initiatives.
Man Group is proud to continue its
active involvement with a number of
industry groups that promote responsible
investment practices. We are a signatory
to the Institutional Investors Group on
Climate Change (IIGCC), the UK Sustainable
Investment and Finance Association (UKSIF),
and the Standards Board for Alternative
Investments (SBAI), as well as being an active
member of the International Sustainability
Standards Board (ISSB). These organisations
aim to develop and reinforce frameworks
for better implementation and adherence of
ESG, as well as governance for the alternative
asset management industry.
In addition to our active participation
in industry initiatives, we also seek to produce
thought leadership around pressing ESG
issues and high-quality research through
the Man Institute. Further, we have hosted
fortnightly ESG seminars internally to
Man Group staff throughout the year.
Highlights of our industry involvement during
2023 include:
• Producing a number of proprietary
research papers, including The Path Less
Travelled series of investing responsibly
in multi-asset portfolios, focused on
non-corporate assets like government
bonds and commodities. In addition, we
recently released ‘Effective Carbon Price:
The Missing Link for Carbon as Alpha’
which highlights a missing link in the use
of carbon emissions intensity as an alpha
signal and underscores the importance
of considering the effective carbon price.
• Publication of Jason Mitchell’s paper, ‘To
Net or Not to Net, That is the Question: A
Regulatory Review for Calculating the ESG
Impact for Hedge Fund Portfolios’ in The
Journal of Impact and ESG Investing. The
paper examines the role of short selling
through the arc of regulatory greenwashing
concerns and safeguards.
• Active participation in industry events and
forums, in which our teams share insights
and learn from other leaders in responsible
investment practices. This year, the team’s
notable participation included: the ‘Going
Beyond Climate Finance’ panel at COP28,
an Academic Network Panel at the UNPRI
conference in Tokyo, and a ‘Green Steel in
Japan’ webinar by Transition Asia.
• The continuation of our podcast series, ‘A
Sustainable Future’, featuring commentary
from asset owners, managers, consultants,
academics and policymakers on pressing
ESG issues. The podcast serves as an
educational tool, sparking conversation
and debate around the intersection of ESG,
regulation and public policy.
Our joint research with the
academic experts at CCSI will
aim to produce a more refined
decarbonisation framework,
and will bring rigour and greater
standardisation when calculating
the climate impact of public
market securities.
Robert Furdak | CIO of RI
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 60
Sustainability and responsibility continued
Emissions from our investments
As stewards of capital, we acknowledge the responsibility, on behalf of our investors and
in accordance with their wishes, to monitor the climate impact of our portfolios, address
climate change risks and opportunities through our investment decisions, and exert
influence on our investee companies to create lasting positive impact.
While there are different views within the
industry as to the application of short
positions in the emissions context, we believe
long exposures through both physical and
derivative securities are the most direct
representation of ownership; however,
engagement rights with companies would
only be through physical long positions (not
long derivative exposure). Our findings are
therefore presented showing coverage as
a percentage of total exposure of all long
positions weighted by the proportion of
total AUM they represent, without netting
off exposure from short positions, or
decomposing indices into their underlying
constituents. The data is, however, calculated
on an issuer basis, therefore long securities
are netted by short securities within the
same fund.
We have updated our calculation of absolute
emissions in line with the GHG Protocol and
the PCAF guidance to use Enterprise Value
including Cash (EVIC), rather than market
capitalisation, which was used in previous
years in line with the rest of the industry. In
this case, we have also restated our historical
analysis to allow for greater comparability.
We acknowledge that a consensus around
methodologies will develop over time, and we
will seek to incorporate any further changes
into our analysis in the future.
In line with the TCFD’s recommendations,
we have disclosed the GHG emissions
associated with our AUM and the WACI
for our key investment strategies. WACI
measures an investment portfolio’s exposure
to carbon-intensive companies, expressed as
tonnes of CO2 emissions per million dollars of
revenue from companies in the portfolio. As a
result, and in contrast to total GHG emissions
for our AUM, WACI is not impacted by
changes in AUM.
We acknowledge that determining the
methodology used to calculate emissions
metrics is an area that is evolving rapidly.
We are focused on refining our analysis,
and accordingly our climate-related
disclosures, on an ongoing basis as the
availability and quality of data improves and
as best practice emerges. To that effect, our
disclosures this year reflect the onboarding of
new data sources and a change to our total
emissions calculation methodology in line
with industry guidance.
Details of our updated methodology and
metrics are set out below.
Methodology
Datasets
For the analysis presented in our 2022 Annual
Report, the sole source of external data used
for the purpose of this exercise was obtained
from S&P Trucost. The dataset provided
carbon emissions data (Scope 1 and
Scope 2 GHG emissions) by issuer,
reported annually by companies or in
some cases, estimated by S&P Trucost. We
acknowledged the limitations of using that
dataset: for example, it covered primarily
single name corporate instruments, which
made it relevant to only a portion of our AUM,
and consequently meant overall coverage for
instruments held in our portfolios was low.
At the time, we also highlighted our efforts to
incorporate additional vendor datasets into
our calculations and to overlay proprietary
analytics to increase the accuracy of the data
that we use. We are pleased to have curated
the Man Group Carbon Dataset during 2023,
which includes data from S&P Trucost,
Sustainalytics and MSCI, combined with an
internally developed tool to cleanse the data
and perform quality checks. Further details
can be found on page 55. Using multiple data
sources has increased the level of coverage,
and therefore related carbon emissions,
Man Group plc | Annual Report 2023
across our AUM and we have restated our
historical analysis to allow for greater
comparability.
Although this development has significantly
improved data quality, it is important to note
that limitations remain. By relying on externally
sourced data, we do not have full control
over its quality. All three providers prioritise
data related to corporate equity, whereas
corporate credit coverage is generally lower.
Certain markets, such as small and mid-cap
issuers, continue to have incomplete
disclosures or limited coverage. As we
have observed previously, there is often
a lag in the data available, driven by the
timing of company reporting or the provider’s
collection, which presents a lack of continuity.
We recommend that our metrics are read
with these limitations in mind.
We continue to utilise internal data for AUM
and underlying exposures.
AUM in scope
The firm’s total AUM as at 31 December
2023 was $167.5 billion. We exclude our
investments in private assets and CLOs
from the analysis due to limited data
availability. We also exclude AUM where the
investment decision is ultimately made by a
third-party (e.g. multi-manager solutions and
emulation mandates).
The AUM in scope for the purposes of
calculating GHG emissions and WACI is
$114.7 billion, or 68% of the firm’s total.
Our approach
We use the total exposure of all long positions
related to the $114.7 billion of AUM in scope
for our WACI calculation. We believe total
exposure is most appropriate as it captures
any leverage used in the investment strategy
or, conversely, any under investment of
capital. This is particularly relevant to capture
the underlying exposures of several of
our alternative investment strategies more
accurately. Any financial instruments (e.g.
derivatives) are also included where possible,
based on their underlying exposure; this is a
departure from the Partnership for Carbon
Accounting Financials (PCAF) definition
of ‘financed emissions’, which are
only calculated on physical shares and
physical corporate bonds. We believe
this is appropriate given the significant
use of derivatives in some of our
investment strategies.
Strategic report 61
Metrics
We have used carbon emissions data by issuer for total exposure of all long positions at the strategy level at 31 December 2023, 31 December
2022 and 31 December 2021 to measure total emissions from our AUM and calculate WACI by strategy, as well as to show a year-on-year trend
in line with the TCFD’s recommendations. As discussed above, the historical figures have been restated to allow for greater comparability given
the changes to our methodology.
Our findings show that total emissions from AUM in scope have decreased during 2023. Our long exposure coverage has increased marginally,
while our long emissions (absolute) have decreased from 5.9 million tCO2e to 5.7 million tCO2e. Despite the data improvements discussed
previously, coverage remains relatively low considering the broad range of instruments we trade and is also influenced by other factors (e.g. total
underlying exposure, which can vary significantly and change frequently).
Absolute emissions (million tCO2e)
Total assets under management in scope
Data
Scope 1 & 2
Coverage
56%
December
2023
5.7
Coverage
54%
December
2022
5.9
Coverage
55%
December
2021
7.7
The table provides a WACI for the key strategies from across our business, aligned to the strategies for which we disclose performance data in
our 2023 year-end press release1.
As illustrated in the table, coverage is significantly higher for long-only strategies, particularly for those where the holdings are in single name
equities. Conversely, coverage for alternative strategies, in particular quantitative strategies, is lower as allocations to corporate instruments are
typically small or via index exposures. FRM Diversified II is part of our multi-manager offering and, as the ultimate investment decision lies with a
third-party manager, these are excluded from this analysis.
WACI (tCO2e/$m revenue)
AHL Alpha
AHL Dimension
AHL Evolution
AHL Diversified
GLG Alpha Select
GLG Event Driven
GLG Global Credit Multi Strategy
AHL TargetRisk
Alternative Risk Premia
GLG Global EM Debt Total Return
FRM Diversified II
Numeric Global Core
Numeric Europe Core
Numeric EM Core
GLG Continental European Growth
GLG Japan CoreAlpha
GLG Undervalued Assets
GLG High Yield Opportunities
GLG Sterling Corporate Bond
Data
Scope 1 & 2
Scope 1 & 2
Scope 1 & 2
Scope 1 & 2
Scope 1 & 2
Scope 1 & 2
Scope 1 & 2
Scope 1 & 2
Scope 1 & 2
Scope 1 & 2
n/a
Scope 1 & 2
Scope 1 & 2
Scope 1 & 2
Scope 1 & 2
Scope 1 & 2
Scope 1 & 2
Scope 1 & 2
Scope 1 & 2
Coverage
<10%
13%
<10%
<10%
56%
94%
82%
<10%
70%
<10%
n/a
100%
99%
99%
99%
100%
94%
49%
58%
December
2023
5
150
30
8
209
145
220
0
156
0
n/a
48
96
252
201
82
103
20
18
Coverage
<10%
15%
<10%
<10%
45%
95%
80%
<10%
80%
<10%
n/a
100%
100%
99%
100%
100%
97%
49%
65%
December
2022
28
184
77
42
155
63
276
0
214
0
n/a
78
94
147
107
122
181
83
94
Coverage
<10%
<10%
<10%
<10%
70%
79%
73%
<10%
76%
<10%
n/a
99%
100%
99%
100%
100%
99%
44%
62%
December
2021
29
94
92
43
348
19
231
0
240
0
n/a
74
155
336
124
104
228
183
159
1 The analysis has been completed for the lead share class of each strategy.
Although our analysis is focused on WACI, we continue to consider on an ongoing basis other carbon footprinting and exposure metrics that
may be useful for decision-making. Outside of carbon emissions and intensity metrics, we are also able to monitor and report on a range of
carbon-only metrics, subject to data availability, for our clients. These include more esoteric metrics, including forward-looking temperature
alignment assessments. We continue to monitor evolving industry standards around GHG emissions accounting and reporting. Our ultimate
aim is to support our clients’ and shareholders’ transition to a low-carbon economy by incorporating best practices into our carbon reporting
as they emerge.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 62
TCFD
Key:
Compliant
In progress
We have included disclosures against the TCFD’s recommendations, providing further
transparency on our approach to managing climate-related risks and opportunities across
our business in 2023, in line with Listing Rules 9.8.6R and 14.3.27R.
We have provided information on all four pillars and 11
recommendations in our Annual Report, incorporating the
supplemental guidance provided for asset managers by the TCFD.
According to our own assessment, we comply with the majority of
the recommendations; when we don’t, we have explained the reasons
why we believe they are not applicable or material to our business,
or why improvements are still required.
Disclosure
recommendation
Man Group assessment/
2023 Annual Report reference
Governance
Compliance
The Board’s oversight
of climate-related risks
and opportunities.
Our ESG governance structure encompasses all elements of Man Group’s RI and Corporate Sustainability
mandates, including all climate-related risk and opportunities, and ensures oversight, controls and reporting lines
are in place up to and including the Man Group Board.
The Board has collective responsibility for climate-related risks and opportunities and for overseeing the firm’s
ambitions in-relation to climate matters. The Board has decided that responsibility for ESG should remain with the
Board as a collective and has not introduced an ESG or Governance Committee or nominated a designated ESG
non-executive director. The Board keeps these arrangements under review. The Board monitors climate-related
risks and opportunities through its receipt of reporting from the RI Leadership team and the Corporate
Sustainability Committee, and considers, where appropriate, the impact of climate when conducting its oversight
and decision-making role against a range of matters, including strategic planning, budget planning, resource
allocation, setting performance objectives and overseeing capital expenditure.
The Audit and Risk Committee, specifically, has delegated authority to monitor compliance with regulations and
disclosures related to climate, sustainability and other ESG considerations.
An outline of our ESG governance structure, including the frequency of meetings, can be found on page 47 of the
Sustainability and responsibility section.
Management’s role
in assessing and
managing climate-
related risks and
opportunities.
Man Group management has a key role in assessing and managing climate-related risks and opportunities.
Our RI Leadership team, comprised of members of our senior management, in conjunction with the Man Group
CEO and Board, set the overarching ESG vision and strategy for the firm.
There are several dedicated and distinct sub-committees that each have established processes to identify,
assess, and monitor risks and opportunities; they regularly inform and report on climate-related risks and
opportunities to both senior management and the Board.
We outline more details on management’s role in assessing climate-related matters and our governance structure
in the Sustainability and responsibility section (page 47) and the Non-financial and sustainability information
section (page 65).
Strategy
Climate-related risks
and opportunities
the organisation has
identified over the short,
medium and long term.
We assess climate-related risks and opportunities on a short-term (one to five-year time horizon), medium-term
(five to ten-year time horizon) and long-term (ten to 30-year time horizon) basis.
The key short-term risks and strategic opportunities for Man Group relate to our ability to integrate meaningful
climate-related analysis into our investment strategies to meet and exceed our client expectations. Associated
reputational risk arises from any suggestion of greenwashing if the ESG credentials of a strategy or product do
not meet client, regulatory or wider public expectations.
Medium-term risks and opportunities include market disruption or volatility triggered by weather events and
disruption to transport and working arrangements, which could lead to increased costs (e.g. procurement,
insurance or taxes) and restrictions on business practices (e.g. limitations on international travel to meet clients).
Longer-term physical risks include major business or market disruption following severe weather events and
long-term impacts on employee well-being.
We have described our climate change risks using the Risk and Control Self-Assessment (RCSA) for the
short-term risks and by conducting an emerging risks assessment for the medium- and long-term risks.
Both processes assess risks by likelihood and impact.
We expand on the above climate-related risks and opportunities, how we determine materiality, and how we
mitigate these risks in the Risk management section (pages 34 and 35).
Man Group plc | Annual Report 2023
Strategic report 63
Compliance
Disclosure
recommendation
Man Group assessment/
2023 Annual Report reference
Strategy continued
The resilience of the
organisation’s strategy
taking into consideration
different climate-related
scenarios, including a
2°C or lower scenario1.
As the world transitions towards a low-carbon economy, our investment performance could be impacted by
fundamental moves in underlying asset prices or liquidity. We have created a proprietary ESG analytics tool to
facilitate analysis of the underlying exposures through a dedicated ESG lens.
We outline the resilience of our business, including our range of products and strategies, to future climate shifts
in the Risk management section (pages 34 and 35) and in the Sustainability and responsibility section (page 51)
under Performance against targets. We have also assessed the resilience of our balance sheet.
The impact of
climate-related risks
and opportunities
on the organisation’s
business, strategy
and financial planning.
Additional
recommendations
included in the
supplemental guidance
for asset managers.
Although the directors and management have considered the impact of climate change, currently none of
Man Group’s plausible downside scenarios are materially driven by specific adverse impacts as a result of
climate change.
We view the climate transition as not only a risk, but also an important driver of opportunity in our business. The
impact on our business, strategy and financial planning is discussed throughout this report, with our firm-wide
strategy for managing and addressing climate-related risks and opportunities, alongside the risk mitigants, in the
Risk management section on pages 34 and 35.
We describe our plans as an organisation for transitioning to a low-carbon economy as well as discuss specific
activities intended to reduce GHG emissions in our operations within the Sustainability and responsibility section
on pages 48 to 50 and lay out our targets as well as how we are progressing against them on page 51.
Climate change has not had a financially material impact on our financial performance and position to date. While
we actively seek to minimise the impact on the transition to a low-carbon economy, senior management does
not currently expect the impact of climate-related risks and opportunities on the Group financial statements to be
material. Further discussion on the impact of climate on our financial statements, and the steps we have taken to
incorporate climate-related issues into our financial planning process can be found in the CFO review (page 27)
and Note 3 to the Group financial statements.
We have endeavoured to reflect a holistic picture of the interdependencies among the factors that affect our ability
to create value over time, however recognise that further progress is still required in this area. We aim to comply
with this requirement in the medium term, as climate-related risks and opportunities to our business become
better understood and measurable.
We believe that the asset management industry has a role to play in fighting climate change and 2023 has marked
another milestone in our commitment to this cause. We must consider how climate-related risks and opportunities
are factored into relevant products or investment strategies, and we believe that we are particularly well placed to
do this because of our technical capabilities across the firm.
We believe we have a competitive advantage from our 35+ years of working with data to be able to solve complex
ESG problems for our clients and their portfolios (pages 53 and 55). More detail on how we utilise our technology
to factor climate-related risks and opportunities into our products and investment strategies can be found on
pages 54 to 56. We also address industry-specific considerations related to these risks and opportunities within
the Risk management section (pages 34 and 35).
We address how climate-related risks and opportunities have been considered in the financial statements in the
CFO review (page 27) and Note 3 to the Group financial statements.
Risk management
The organisation’s
process for identifying
and assessing
climate-related risks.
Man Group considers climate risks to the firm over several time horizons, through multi-disciplinary firm-wide
risk identification, assessment and management processes. The types of risks considered include current and
emerging regulation, technological changes and upgrades, market risks, reputational risks, acute and chronic
physical operational impacts as well as upstream and downstream risks.
Strategic and/or operational climate change risks, are managed in the same way as other business risks and are
covered by our firm-wide risk management systems. By using the same risk assessment framework, we are able
to calibrate the relative significance of climate-related risks against our other principal risks, further detail of which
can be found on page 34.
The organisation’s
process for managing
climate-related risks.
Climate change risks are captured in Man Group’s risk governance and reporting framework within the associated
risk category such as investment performance or business continuity. The risk governance framework is owned
by the Board and implemented by the senior management of Man Group, and it is at this level that strategic
decisions are made to avoid, mitigate, reduce or accept risks, including those related to climate change.
We outline our processes for managing climate-related risks in the Risk management section (page 34 and 35).
1 We set firm-wide targets considering the Paris Agreement, an international treaty on climate change adopted in December 2015. The goal of the agreement is to limit global warming to well below
2°C, and pursue efforts to limit the temperature increase to 1.5°C above pre-industrial levels.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 64
TCFD continued
Disclosure
recommendation
Man Group assessment/
2023 Annual Report reference
Risk management continued
Key:
Compliant
In progress
Compliance
How processes for
identifying, assessing
and managing
climate-related risks
are integrated into the
organisation’s overall
risk management.
We monitor and manage climate-related risks through regular reporting and management information processes
for the relevant principal risk the climate-related risk falls within (see risks 1, 7, 11 and 12 of the risk framework),
as well as for the specific climate-related risk (see page 34).
We outline how our climate-related risk management framework processes are integrated into our overall risk
management in the Risk management section (pages 34 and 35).
Additional
recommendations
included in the
supplemental guidance
for asset managers.
We address further the industry-specific considerations in relation to climate change risks in the Sustainability and
responsibility section. We are investing to enhance our approach to managing climate change risks and believe
that our data-driven culture puts us in a prime position to assist our clients in the transition towards a low-carbon
economy. We discuss how we identify and assess material climate-related risks in our investment strategies on
page 56.
We have also made substantial progress in our climate stewardship activities during 2023, and we expand on
these efforts on pages 58 to 60.
We also discuss our continued commitment to the Net Zero Asset Managers initiative and acknowledge the
importance of managing climate-related risks in our portfolios (page 53).
Metrics and targets
The metrics used by the
organisation to assess
climate-related risks and
opportunities in line with
its strategy and risk
management process.
The targets used by
the organisation to
manage climate-related
risks and opportunities
and performance
against targets.
The metrics and targets we use to assess climate-related risks and opportunities related to our operations
are shown in the Sustainability and responsibility section; we provide our total carbon emissions and carbon
emissions per FTE, as well as how these metrics have changed over time (pages 49 to 51).
We monitor our carbon emissions from travel and incorporate these as part of our annual budgeting process,
embedding Scope 3 carbon emissions reduction targets across the business this year. We will continue to
monitor the developments made in this area and refine our approach on an ongoing basis.
Man Group is committed to reaching net zero corporate carbon emissions across our global workplaces by 2030,
in line with the NZAMI (page 48). We set firm-wide targets in line with the Paris Agreement. In 2022, we set an
additional SBTi-aligned strategy for a 1.5°C scenario by 2030 and created shorter-term carbon emission targets
on our path to net zero by 2030 (page 53).
In order to continue to manage climate-related risks and opportunities against our targets, we introduced
carbon emissions targets into our directors’ long-term incentive plans from 2022, as set out in the Directors’
Remuneration report on pages 109 and 119 and incorporated carbon considerations in our budget process
this year. This is aligned with our emissions targets for business travel through 2030.
We have also prioritised carbon net zero strategies when refurbishing or relocating offices in addition to continuing
to adopt agile working strategies to reduce our office carbon footprint.
The targets we use to manage climate-related risks and opportunities related to our operations, and our
performance against these targets, are shown in the Sustainability and responsibility section (page 51).
Scope 1, 2 and 3
greenhouse gas
(GHG) emissions
and related risks.
The emissions metrics related to our operations are shown in the Sustainability and responsibility section
(pages 49 and 50). These calculations are in line with the GHG Protocol and have been provided for historical
periods in order to allow for accurate comparability and greater transparency.
We have included details on the specific methodology utilised for this calculation on page 50.
Additional
recommendations
included in the
supplemental guidance
for asset managers.
We describe the metrics used to assess climate-related risks and opportunities within our investment strategies
on pages 60 and 61, using GHG emissions from our assets under management and the weighted average carbon
intensity for a number of our largest strategies. This year, we onboarded new data sources and developed a
proprietary carbon dataset to increase the data coverage for our calculations. We have also updated our
calculations in line with industry best practice. Our ambition remains to refine these calculations as better data
becomes available and a consensus around methodologies develops.
We have also set targets to reduce emissions within our investment strategies, in line with the NZAMI, which are
outlined on page 53 of the Sustainability and responsibility section.
We have disclosed the metrics we consider meaningful at this time. Outside of carbon emissions and intensity
metrics, we also report on a range of carbon-only metrics, subject to data availability, for our clients. We continue
to monitor industry developments and aim to incorporate best practices into our carbon reporting as they emerge.
Man Group plc | Annual Report 2023
Strategic report Non-financial and sustainability information statement
65
Man Group has chosen to comply with sections 414C, 414CA and 414CB
of the UK Companies Act 2006, although we are not required to do so
as a Jersey incorporated company.
The table below constitutes our non-financial and sustainability information statement. Information contained herein is incorporated by
cross reference. For a description of our business model please refer to pages 10 and 11.
Our policies
and standards
Due diligence
and governance
Impact and outcomes of
our policies and standards
Related
principal risks
Environment
Environmental
Sustainability Policy
Statement
Describes our commitment
to conducting our business
responsibly, minimising
the environmental and
climate-related impact of
our activities.
Climate-Related Financial
Disclosures
Our climate related financial
disclosures can be found
within the TCFD disclosures
on pages 62 to 64.
Social Matters
RI Policy and processes
Outlines our recognition and
support for the development
and integration of RI
modalities across the firm.
Engagement Policy
Outlines our approach to
shareholder engagement and
proxy voting, as stewards of
our clients’ capital.
We track our progress through environmental data
compilation systems, which ensure accurate reporting
of measures. Our climate change strategy is set by the
Board. For further information please see page 34.
Our strategy, targets and performance metrics in
relation to our impact on the environment can be
found on pages 48 to 51. Our metrics in relation to
our investment strategies can be found on page 61.
On behalf of the Board, the Corporate Sustainability
Committee oversees the policies, processes and
operational controls of sustainability risks and
opportunities as a corporate.
Our greenhouse gas emissions data can be found
on page 49.
We maintain carbon neutrality across our direct
corporate operations through the purchase of
verified carbon units (VCUs).
Climate change
risk management
and strategy is
discussed on
pages 34 and 35
and as a principal
risk on page 34.
The Board has collective responsibility for providing
climate-related oversight and setting the firm’s
climate-related strategy. The Board oversees progress
on the development of our climate-related financial
disclosures and is kept apprised of climate-related
risk via the Audit and Risk Committee.
Senior management are responsible for implementing
the climate strategy as set by the Board.
Further information on our ESG governance structure
and risk management strategy can be found in the
Sustainability and responsibility section on page 47.
Our Responsible Investment Committee oversees the
implementation of the Man Group RI Policy, and other
RI-related policies and processes. The Board receives
regular updates from the RI Leadership team. We review
and update our RI policies on an annual basis.
Man Group now has five dedicated ESG committees,
which regularly inform and report on ESG-related
matters to senior management, the RI leadership team
and the Man Group Board.
Man Group has established an ESG Centre of Expertise
(RI Team), responsible for driving the integration of RI
and engagement across the firm. Man Group’s RI team
is responsible for the day-to-day implementation of the
Man Group RI Policy.
The diversified nature of our multi-strategy businesses
means that no RI framework is universally applied.
Accordingly, we apply the norms and best practices of
RI that are most appropriate for the strategies and asset
classes we manage.
Our Stewardship team oversees proxy voting and
engagement activity at the firm level, including the
application and maintenance of our Engagement Policy.
Fund-level engagement is delegated to the investment
teams. The Engagement Policy was formalised by a
cross-section of business units, including investment
managers and RI and stewardship personnel. The
Stewardship Committee is responsible for monitoring
compliance with the policy and overseeing amendments
to the policy.
We report in line with the TCFD recommendations
Further information on our climate-related financial
disclosures, can be found on pages 62 to 64.
Man Group remains a signatory to the Net Zero Asset
Managers initiative. We have committed to reducing
greenhouse gas emissions to net zero in investment
portfolios by 2050. In 2022, we set an interim
decarbonisation target for 2030.
Climate change
risk management
and strategy is
discussed on
page 34 and 35
and as a principal
risk on page 34.
We integrate ESG considerations in our investment
decision-making and monitoring across strategies,
in line with the RI-related policies and processes
overseen by the Responsible Investment Committee.
Our ESG integrated AUM is $59.3 billion and we
continue to leverage our technology and data
capabilities to drive ESG integration across the firm
and have developed a suite of proprietary ESG tools to
support investment decision-making and management.
For further information on our RI efforts, please see
pages 52 to 56.
Man Group is a signatory to the UN-supported PRI and
reports annually on our RI work to the PRI.
RI is linked to
our investment
performance
and reputational
principal risks
on page 30
and page 33.
Not linked to our
principal risks.
The Engagement Policy sits alongside our Voting
Policy Framework. It describes how the firm integrates
shareholder engagement in the investment strategies,
monitors investee companies on a regular basis,
conducts dialogues with investee companies on relevant
matters, exercises voting rights, cooperates with other
shareholders, communicates with relevant stakeholders
of the investee companies, and manages actual and
potential conflicts of interest to the firm’s engagements.
Our stewardship activities can be found on pages 57
to 59.
Man Group is a signatory to the UK Stewardship Code
and the UN-supported Principles for RI.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information ManKind Initiative
The Company’s volunteering
programme which aims to
encourage employee
volunteering.
Global Banned Weapons
Policy
Sets out our approach
to Global Banned Weapons
investments.
66
Non-financial and sustainability information statement continued
Our policies
and standards
Due diligence
and governance
Social Matters continued
Impact and outcomes of
our policies and standards
Related
principal risks
We prioritise giving back to our communities and this
takes place through various initiatives, partnerships and
channels. For further information on our initiatives see
page 43.
Senior management actively promotes the ManKind
initiative across the firm to encourage employee
participation in volunteering activities. We are pleased
that over 400+ employees volunteered in 2023.
Not linked to our
principal risks.
The Financial Crime Compliance team maintains and
oversees this policy and we have developed internal
systems and controls to assist the firm in complying
with the restrictions.
Man Group has established a firm-wide zero
tolerance threshold to limit the firm’s exposure
to Banned Weapons. The funds we manage are
not permitted to directly invest in or finance companies,
which our independent third-party specialist screening
provider believes are involved in the manufacture,
supply or distribution of weapons banned by
international convention.
RI is linked to
our investment
performance
and reputational
principal risks on
page 30 and page
33. Legal,
compliance and
regulatory risk is
a principal risk on
page 33.
Not linked to our
principal risks.
Well-being and inclusion
– Global Inclusion
Statement
We are committed to looking after our people and have
a global well-being programme in place. This includes
guidance given by newsletters, webinars and events
(onsite and virtual).
We have a number of policies and offerings including
Gender Neutral Parental Leave, Employee Assistance
Programme, Tenure Award Leave, and Flexible Working
options. For further information see the People and
Culture section on pages 36 to 43.
Anti-Bribery and Corruption
Anti-Bribery and
Corruption Policy
& Financial Crime
Compliance Statement
of Principles
Sit alongside other policies
covering political and
charitable donations, gifts
and entertainment, fraud,
tax evasion, sanctions,
anti-money laundering and
counter-terrorism financing.
Employees
Global Code of Ethics
and Code of Conduct
and Whistleblowing
Policy
Describes our commitment
to high standards and
professional conduct
Ongoing oversight is provided by senior
management.
Annual reports from the Money Laundering
Reporting Officer are submitted to the Audit and
Risk Committee and processes and procedures are
further reviewed by Man Group’s Internal Audit team.
Annual training is provided to employees to ensure
they understand their responsibilities and duties.
Our approach to anti-bribery and corruption is
designed to comply with all applicable laws and
regulations and is overseen by a dedicated team
who work to ensure our policies and practices are
implemented and designed to prevent, detect and
report suspicious activity and red flags.
In addition, risk-based due diligence procedures
have been designed to identify and verify the owners
and controllers of relationships to ensure we know
our partners in business, suppliers and clients
and that we are compliant with all applicable
laws and regulations.
Failure to
implement
effective controls
in relation to
anti-bribery
and corruption
is a principal
operational risk
under ‘criminal
activities’ on page
33.
The Company has a monitoring framework which
ensures these codes are regularly reviewed and
remain fit for purpose. Regular training is provided
to employees to ensure they are informed of our
expected standards.
Our whistleblowing policy allows staff to raise
concerns anonymously and is subject to
independent oversight by the Audit and
Risk Committee.
Employees contribute to our success by adhering
to our core business principles: acting ethically
and with integrity, putting clients’ interests first,
monitoring conflicts of interest, retaining and
disclosing information appropriately and
observing high standards of business conduct.
Employee
conduct is linked
to our operational
and reputational
principal risks on
pages 32 to 33.
Employees are able to raise concerns to an
independent external agency (Safecall), and
governmental, regulatory, self-regulatory, or law
enforcement authority, as well as to nominated
individuals internally. Disclosures are reported, on an
anonymised basis) to the Audit and Risk Committee.
Health and Safety Policy/
Statement
Describes our commitment
to ensuring the health,
safety and welfare of our
employees by providing safe
working environments and
ensuring Man Group’s
statutory duties in respect of
health and safety are met at
all times.
We track progress through a number of health
and safety systems ensuring accurate reporting
of accidents, incidents and near misses and
prevention measures.
We aim to minimise health and safety risks and we
have an ongoing programme of health and safety
risk assessments and undertake improvements
throughout the year.
On behalf of the Board, the Health and Safety
Committee (HSC) oversees the development and
implementation of our health and safety processes
and procedures. Our Board maintains overall
responsibility for the health and safety and welfare
of employees.
We evaluate the safety training needs of employees
and ensure that they receive appropriate training
including induction safety training.
Statutory and regulatory risk assessments are
carried out annually and observations actioned
and closed out in a timely manner.
Employee
well-being is
linked to our
operational
principal risks
on page 32.
Man Group plc | Annual Report 2023
Strategic report 67
Our policies
and standards
Due diligence
and governance
Employees continued
Impact and outcomes of
our policies and standards
Related
principal risks
Diversity, Equity and
Inclusion Initiatives,
Global Inclusion
Statement and diversity
focused recruitment
policy
Governs our approach
to diversity.
‘Paving the Way’
Initiative
Our initiatives focus on
attracting diverse talent
into the Company and
the industry.
Human Rights
Human Rights Statement
and Modern Slavery
Transparency Statement
Sets out our high standards
and how these define and
inform our operations and
prevent modern slavery
from occurring within
the business and
supply chain.
Other
Service Provider
Management Policy
Ensures our fund
service providers are
appropriately selected,
managed and overseen and
that any issues are identified
and escalated.
Supplier Code
of Conduct
Sets out our business
conduct expectations
of our suppliers.
Non-financial KPIs
Our diversity, equity and inclusion initiatives support
Man Group’s commitment to improving diversity
across the Company and within the finance industry
more generally. The initiatives are supported at a
senior level by the Executive Committee and our
Drive (DE&I) Steering Committee (see pages 40
to 41).
Our Board meets the diversity targets set by the
FTSE Women Leaders Review, Parker Review and
Listing Rules and we continue to be cognisant of
diversity when reviewing the composition of our
Board in line with our Board Diversity, Equity and
Inclusion Policy. See pages 98 to 99 for further
information.
Not linked to our
principal risks.
Further information on our diversity, equity and
inclusion initiatives can be found within our DE&I
report on the Man Group website.
We actively encourage, support and progress
initiatives that help assist in addressing social
barriers that have historically prevented access to
our industry. Our initiatives are overseen by the Drive
(DE&I) Steering Committee, and the Board and
senior management are updated on progress.
As part of the ‘Paving the Way’ initiative we have
partnered with various organisations to address
pipeline recruitment issues. For more information see
the Corporate Social Responsibility booklet on the
Man Group website.
Not linked to our
principal risks.
Man Group is committed to high standards
of business conduct and this extends to the
commitment to the protection of human rights
throughout the business.
The Board reviews and agrees the Modern Slavery
and Transparency Statement on an annual basis.
Our Human Rights Statement sits alongside our
Global Inclusion Statement and our Modern Slavery
Transparency Statement, showing our commitment
to the promotion of human rights within the
workplace, our operations and how we operate
our business. For more information see the
Corporate Social Responsibility booklet on the
Man Group website.
Negative publicity
is a principal
reputational risk
on page 33.
Legal, compliance
and regulatory
risk is a principal
risk on page 33.
There are no known instances of modern slavery
within our business.
An ongoing programme of due diligence is
conducted, and guidance is provided on our
expectations of their conduct and operation.
Through our current programme we are able to
partner closely with our fund service providers
and ensure that we have detailed oversight of their
service provision and that any issues are promptly
identified, escalated and resolved.
External
process failure
by one of our
service providers
is a principal
operational risk
on page 32.
The Supplier Code of Conduct was finalised in 2021
and outlines the minimum standards we expect of
our suppliers, as pertaining to considerations around
any economic activities, impact to the environment,
as well as engagement with the wider community.
We endeavour to work closely with our suppliers to
address global social and environmental challenges.
Vendor management including performance
reviews are used to monitor the KPIs/service-level
agreements put in place to monitor our suppliers.
Negative publicity
is a principal
reputational risk
on page 33.
The Board and senior management review
the appropriateness and progress against non-
financial KPIs.
Further information on our non-financial KPIs can be
found on page 21.
Negative publicity
is a principal
reputational risk
on page 33.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 68
Governance overview
Overview for 2023
Our purpose and strategic priorities are
outlined on pages 2 to 3 and 14 to 15.
This section outlines the role of the Board in
overseeing the delivery of strategy and the
governance framework in place to support
it. It also explains who our stakeholders are
and how the Board considers their views
when making key decisions.
Statement of compliance
The Company is subject to the 2018 UK Corporate Governance
Code (the Code), which is publicly available at www.frc.org.uk.
The Company has, throughout the year ended 31 December
2023, applied the principles of, and complied with the provisions
of, the Code except in relation to the following:
Provision 15 of the Code recommends that additional external
appointments for directors should not be undertaken without
the prior approval of the Board. The Board has established
an effective process for approving such appointments. The
process requires directors to inform the Chair of any proposed
external appointment. The Chair then assesses the proposed
appointment and either approves it, or, refers the matter to the
full Board for consideration, for example in a situation where
there may be a potential conflict with the director’s role on the
Man Group Board. A description of the process is on page 84.
Provision 33 of the Code requires that the Remuneration
Committee (the RemCom) should have delegated responsibility
for setting the remuneration of the Chair. The terms of reference
of the RemCom provide that the RemCom has authority to
recommend to the Board but not to approve the remuneration
of the Chair. This is because the Board believes that in order
to provide transparency and allow the views of all directors,
executive and non-executive, to be taken into account,
it is appropriate for all Board members to provide input into
determining the Chair’s remuneration. The Chair does not
participate in this decision.
The new UK Corporate Governance Code published in January
2024 will apply to Man Group in the financial year beginning
1 January 2025 (other than provision 29 which will apply the
following financial year). We are considering the changes in the
new Code and will report on progress at the appropriate time.
Section 172(1) statement (including principal decisions
and engagement with stakeholders)
The Board of directors confirms that during the year ended
31 December 2023, it has acted in a way that it believes promotes
the long-term success of the Company for the benefit of its members
as a whole, whilst having due regard to the matters set out in section
172(1)(a) to (f) of the UK Companies Act 2006.
Details of how this has been achieved and the way in which the Board
has engaged with our identified stakeholders, the outcomes of this
engagement and the consideration of stakeholder interests in principal
decisions are set out on pages 78 to 83.
Man Group plc | Annual Report 2023
Corporate Governance Code Index
1. Board leadership and Company purpose
We have a diverse and effective Board which leads the Group to achieve our
purpose and safeguard our stakeholder focused culture.
Effective Board
Value creation and preservation
Workforce policies and practices
Governance framework
Purpose, values and culture
Stakeholder engagement
Key activities of the Board in 2023
2. Division of responsibilities
Page(s)
84-87
70
80
70
2-3
78-83
76-77
Our Board is comprised of 75% independent non-executive directors, including
the Chair. We monitor external commitments and conflicts of interest.
Board roles
Independence
Conflicts of interest
External appointments
71
84
84
84
3. Composition, succession and evaluation
The composition of the Board and its succession plans are kept under regular
review by the Nomination and Governance Committee. We have an ongoing
training programme and follow a three-year cycle of undertaking external
Board evaluations.
Board skills, experience and knowledge
Training
Board evaluation
Board and committee composition
Succession planning
Board diversity, equity and inclusion
4. Audit, risk and internal control
85
85
86
72-73
97
84
Man Group’s risk management framework and internal control systems aim to
safeguard assets, maintain proper accounting records, and provide assurance
that the financial information used internally and published externally is robust
and reliable.
Financial reporting
Significant financial judgements
Internal financial controls
Assurance over external reporting
Internal and external audit
Internal controls and risk management
Business continuity and disaster recovery
Cyber security
Viability
5. Remuneration
We are transparent about our pay practices which aim to incentivise our
executive team to achieve our strategy and generate sustainable value.
Executive Director policy table
Alignment with strategy and performance
Shareholder voting and engagement
Remuneration decisions in context
Executive Director remuneration in 2023
92
90
92
94
94
92
92
93
35
104
101
122
108
104
Governance Chair’s governance overview
69
Anne Wade
Chair
I am delighted to have taken on the role of
Chair and look forward to continuing to work
closely with the Board and the executive team
to guide Man Group through the next phase
of its journey.
Dear Stakeholder
I am pleased to present the Governance report for the year-ended
31 December 2023, my first as Chair of Man Group. This section
will enable you to gain an understanding of Man Group’s governance
framework and responsibilities, as well as the areas of focus and
performance of the Board over the past year. We recognise the
importance of corporate governance across the organisation and
report under the 2018 UK Corporate Governance Code (the Code).
This year, we have introduced an index on the opposite page to help
stakeholders understand how the Company has complied with, and
reported against, the principles and provisions of the Code.
Board changes
There have been several changes to our Board this year as I
highlighted in my introductory statement. Jackie Hunt and Kate Barker
stepped down in March and April respectively and we thank them for
their valuable contributions whilst on the Board.
In May, Luke Ellis informed the Board of his intention to retire as CEO,
following which we implemented our agreed succession plan and
were very pleased to appoint Robyn Grew as Luke’s successor.
Robyn took over from Luke and joined the Board on 1 September.
Robyn brings a wealth of knowledge and experience to the role;
she has a clear vision and ambition for Man Group as a global,
active investment firm, as well as undeniable passion for creating a
collaborative and diverse culture at the firm. We thank Luke for his
outstanding leadership of Man Group since 2016 and wish him all
the best for his retirement.
In August, we welcomed Laurie Fitch to the Board. Laurie took over
from me as Remuneration Committee Chair in October.
At the end of September, John Cryan stepped down as Chair after
almost nine years on the Board, at which time I took over the role.
I’d like to thank John for his enormous contribution to the Board over
the years and wish him all the best for the future.
In early 2024, Alberto Musalem informed the Board that he had been
selected as the next President and Chief Executive Officer of the St.
Louis Federal Reserve Bank and, as a result, it would be necessary for
him to step down from the Board. Alberto will leave us at the end of
February and we wish him every success in this new appointment.
Man Group plc | Annual Report 2023
Strategy
Following the announcement of Robyn’s appointment as CEO, the
Board has devoted significant time to focusing on the firm’s strategy,
holding strategy sessions in June and September. Robyn and the
executive management team presented and discussed with the Board
potential options for the future strategic direction of the firm. These
plans were finalised at a further strategy session in January 2024 and
with key themes to be communicated to the market formally approved
by the Board in February.
Diversity, equity & inclusion
We remain committed to promoting diversity, equity and inclusion
across the organisation. We are proud to maintain a Board that
exceeds the gender and ethnicity targets set out in the FTSE Women
Leaders Review and Parker Review, and the Listing Rules, with two of
the four senior Board positions (Chair, CEO, SID and CFO) now held
by women. Our Board Diversity, Equity & Inclusion Policy, which was
updated and approved by the Board in early 2024, is set out on
pages 98 to 100.
Board activities and effectiveness
2023 has been a year of transition for Man Group and the Board,
and a summary of our key activities is set out on pages 76 and 77.
In addition to the Board changes mentioned above, we also approved
the acquisition of Varagon, a leading U.S. middle-market private credit
manager which completed in early September 2023 (further details
are on pages 15 and 78). We were very pleased to be able to meet the
Varagon team during the Board visit to New York this year.
In mid-2023, we commissioned external consultants (Clare Chalmers
and A&O Consulting) to undertake a review of our Board culture and
governance arrangements. The review indicated that the Board was
high quality and well run, with a rigorous and disciplined approach.
Areas for potential improvement were also suggested which we
agreed and implemented during 2023 and early 2024. Further details
are set out on page 86. Following on from this, we also conducted
an internal Board effectiveness review in respect of 2023. We are
pleased with the results, summarised on page 87, which echoed the
independent review findings and demonstrate that we continue to be
an effective and collaborative Board.
Board priorities for 2024
2024 is likely to be another busy year as we look to implement the
strategy that the Board has approved. We intend to focus much of our
time monitoring progress on delivery of the strategy to ensure that the
firm continues to deliver outperformance for clients and excellent value
to shareholders.
We will also look to continue to build on our Board skills and experience
in 2024 through the appointment of additional non-executive directors
with deep markets and extensive accounting experience.
Thank you
Finally, I’d like to thank all of our people for their hard work and
commitment during 2023 and for continuing to demonstrate the
strong and positive culture that makes Man Group so unique. I am
delighted to have taken on the role of Chair and look forward to
continuing to work closely with the Board and the executive team
to guide Man Group through the next phase of its journey.
Anne Wade
Chair
Strategic report | Governance | Financial statements | Shareholder information 70
Governance structure
Key:
Flow of information to the Board
Delegated authority from the Board
Board
Role of the Board
The Board’s core role is to act in the best
interests and promote the long-term success of
the Company for the benefit of its members, with
due regard to the interests of other stakeholders.
This requires it to:
• Determine and review business strategy;
• Monitor management performance in delivering
against the firm’s strategy;
• Ensure that risk management measures and
internal controls (including those related to
climate) are appropriate and effective;
• Oversee and monitor the embedding of
and adherence to the Company’s business
values; and
• Ensure that the Company’s financial structure,
resources, talent and culture supports
long-term growth.
In discharging this role, the Board also has regard
to the interests of a wide range of stakeholders,
including clients, shareholders, employees,
broader communities and the environment,
business partners and suppliers and regulators,
in order to build mutual trust and support the
long-term sustainability of the business.
Matters reserved for the Board
To discharge its role, the Board has reserved
certain key areas of decision-making, including
business strategy, risk appetite, material
acquisitions and disposals, capital structure
and funding, financial reporting and dividend
policy. A full list of the Board’s reserved
matters is available on our website at
www.man.com/corporate-governance.
Board Committees1
Audit and Risk Committee
• Reviews the integrity of the
Remuneration Committee
• Determines and
Company’s financial reports
and statements, and
recommends their approval
to the Board
• Recommends to the Board
the appointment of the
external auditor and reviews
their effectiveness and
independence
• Approves the Internal
Audit plan and reviews
the effectiveness of the
Internal Audit function and
management’s response to
their findings
• Reviews and reports to the
Board on the effectiveness
of Man Group’s risk
management and internal
controls framework
¬ See page 88
recommends to the
Board the principles and
structure of the Directors’
Remuneration Policy
• Approves the total annual
compensation for individual
executive directors
• Approves the quantum
of the Company’s annual
variable compensation pool
and deferral policies
• Considers and reviews the
remuneration of the wider
workforce
• Approves the total annual
compensation for Executive
Committee members,
Company Secretary and
Remuneration Code staff
• Oversees the Company’s
engagement on directors’
remuneration and reporting
¬ See page 100
Board Committees1
Nomination and Governance
Committee
• Keeps the Board’s size,
structure, composition and
diversity under review in
response to business
needs and opportunities
• Considers the skills,
experience and knowledge
required for Board
appointments
• Conducts the search and
selection process for new
directors, taking advice
from independent
search consultants
• Recommends to the Board
preferred candidates for
Board appointment
• Reviews Board and senior
management development
and succession planning to
ensure continuity of resource
• Monitors and reviews the
Company’s corporate
governance arrangements
• Considers the output of
Board performance reviews
and is responsible for the
implementation of any
resulting recommendations
¬ See page 96
1 Committee terms of reference, which are reviewed and approved by the Board on an annual basis, can be found
on our website. Details of the work of the Committees during the year are given in the separate Committee reports
in this Annual Report.
Executive Committee (ExCo)
Following the appointment of Robyn Grew as CEO of the Company, a new, streamlined ExCo was
established. Details of the membership of the ExCo and its function can be found on pages 74-75.
The ExCo assists the CEO in the day-to-day management of the firm and is responsible for the
implementation of the Company’s global business strategy, ensuring that it is disseminated and
actioned accordingly within the Company’s two distinct geographically-aligned sub-groups in line
with the delegated authorities framework.
Man Group plc | Annual Report 2023
Board delegation
to the CEO
All significant business
decisions and activities
which are not reserved for
the Board and its
Committees are delegated
to the CEO.
CEO
CEO’s operating
authorities and
procedures
To help manage and
control the business on
a day-to-day basis, the
CEO has implemented a
framework of delegated
authorities and procedures
which applies throughout
the firm. This framework
sets out authority levels
and controls in respect of
material business change,
the development of Man
Group’s product range,
non-budgeted expenditure,
recruitment and
compensation, legal
agreements, financial
guarantees and use of the
Company’s balance sheet.
Governance 71
Board responsibilities
Chair
CEO
• Leads the Board, sets its agenda and ensures it discharges its
role effectively.
• Supports and constructively challenges the CEO, promotes effective
relationships between executive and non-executive Board members,
and maintains a culture of open debate.
• Leads, with the support of the Nomination and Governance Committee,
effective Board succession planning and the search for and appointment
of new directors, taking account of the need for the development of Board
skills, experience and diversity.
• Ensures that the Board maintains effective engagement with
shareholders and takes account of the interests of all stakeholders in
its decision-making.
• Has responsibility for the day-to-day management of the business
subject to appropriate delegated authorities, risk management and
internal controls.
• Develops, for Board consideration and approval, business strategy,
and reports on management’s delivery against it.
• Leads the ExCo (see pages 74 and 75), which is responsible for
implementing the firm’s strategy.
• Communicates a shared purpose and set of business principles and
builds management talent.
• Works closely with the Chair and leverages the knowledge of
non-executive Board members.
• Maintains an effective dialogue with shareholders on the firm’s strategy
and performance.
CFO
Senior Independent Director
• Manages the allocation and maintenance of the firm’s capital, funding and
liquidity in accordance with regulatory requirements.
• Maintains a broad overview of the work of the Board and its Committees.
• Provides a sounding board for, and advice to, the Chair on Board matters
• Has responsibility for the preparation and integrity of the firm’s financial
information and its reporting, in accordance with the Board governance
framework.
• Leads the development of annual budgets and medium-term plans for
Board approval.
• Has responsibility for the firm’s financial risk management within the
Board’s risk appetite statements.
• Maintains an effective dialogue with shareholders and stakeholders on the
performance and financial structure of the firm.
• Has responsibility for and leads the firm’s corporate development strategy,
including merger and acquisition activity.
including development and succession planning.
• Acts as a point of contact for communications with the non-executive
directors as required.
• Leads the annual performance evaluation of the Chair.
• Leads the search for the appointment of a new Chair.
• Engages with shareholders.
Non-executive directors
Company Secretary
• Determine and review business strategy and oversee management’s
delivery against it.
• Supports the Board and Committees in discharging their respective roles.
• Advises the Board on corporate governance matters, ensuring good
• Monitor and challenge management performance in delivering business
governance practices.
strategy and objectives.
• Maintains the books and records of the Company and prepares minutes
• Contribute to the identification of principal business risks and the
of Board and Committee meetings.
determination of risk appetite.
• Monitor and challenge the effectiveness of the internal control and risk
management framework.
• Monitor compliance with the regulatory principles and requirements
impacting asset management and distribution.
• Review and challenge the Company’s financial statements and
announcements.
• Keep Board composition and succession planning under review in light of
changing business needs and recommend any changes to be considered.
Board and Committee Attendance 2023
• Facilitates the induction, and ongoing training and professional
development, of non-executive directors to support them in carrying
out their responsibilities.
• Monitors and ensures compliance with company law, Listing Rules,
Disclosure Guidance and Transparency Rules and the UK Market
Abuse Regulation.
• Organises the Company’s AGM and other shareholder meetings.
• Acts as the main point of contact for retail shareholders.
Kate Barker
Lucinda Bell
Richard Berliand
John Cryan
Luke Ellis
Laurie Fitch
Audit & Risk
Committee
1/1
5/5
5/5
N/A
N/A
2/2
Nomination &
Governance
Committee3
N/A
10/112
11/11
10/10
N/A
1/1
Remuneration
Committee
2/2
N/A
7/7
5/5
N/A
2/2
Board1
3/3
10/112
10/112
9/9
7/82
3/3
Antoine Forterre
Robyn Grew
Jacqueline Hunt
Ceci Kurzman
Alberto G. Musalem
Anne Wade
Audit & Risk
Committee
N/A
N/A
1/1
N/A
5/5
N/A
Nomination &
Governance
Committee3
N/A
N/A
N/A
1/1
1/1
11/11
Remuneration
Committee
N/A
N/A
2/2
2/2
7/7
7/7
Board1
11/11
3/3
2/2
11/11
11/11
11/11
Includes two strategy sessions which were attended by all Board members and three ad-hoc Board meetings which were held to consider and approve specific matters.
1
2 Due to conflicting commitments, Lucinda Bell, Richard Berliand and Luke Ellis were each unable to attend one Board meeting and Lucinda Bell was unable to attend one Nomination & Governance
Committee meeting during 2023. These meetings were held at short notice to consider and approve specific matters. Each director received the meeting packs in advance of the meetings for review
and provided their comments to the Chair or Committee Chair, which were addressed at the meeting as appropriate.
Includes nine ad-hoc meetings which were scheduled to consider and approve specific matters.
3
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 72
Board of Directors and Company Secretary
A balanced and effective team
Our directors bring diversity of skill, experience and outlook which we believe leads
to better decision-making, creates greater value and promotes the long-term success
of the Company.
N
R
Anne Wade
Chair
Robyn Grew
Chief Executive Officer (CEO)
Antoine Forterre
Chief Financial Officer (CFO)
Appointed
April 2020. Chair: October 2023.
Appointed
September 2023.
Appointed
October 2021.
Background and career
Anne held senior roles in research and equity
investment during her 17-year career at Capital
International, including Senior Vice President and
director. She also served as a non-executive director
and Chair of the Remuneration Committee of
John Laing Group plc from 2015 to 2021 and as a
non-executive director of Holcim Limited from 2013
to 2015.
Areas of expertise and contribution
Significant experience in investment management,
from fund management to social finance, ESG and
impact investment.
Material external positions
Non-executive director of Summit Materials, Inc.*
Background and career
Prior to joining the Board, Robyn served as President
of Man Group with responsibility for managing the
Solutions business and overseeing trading and
execution. Robyn’s previous roles at Man Group
have included Group COO, Head of ESG and General
Counsel. Before joining Man Group, Robyn held senior
positions at Barclays Capital, Lehman Brothers and
LIFFE (since renamed ICE Futures Europe), the largest
futures and options exchange in London.
Areas of expertise and contribution
Robyn has significant operational and financial
services experience as well as a strong track
record of demonstrating strategic vision and
collaborative leadership.
Material external positions
Trustee, Standards Board for Alternative Investments.
Background and career
Prior to his appointment to the Board, Antoine
served as Co-CEO of Man AHL from 2017 and COO
of Man AHL from 2015, before which he was Head of
Corporate Development and Group Treasurer of Man
Group. Before joining Man Group in 2011, Antoine
worked at Goldman Sachs in London and Paris.
Areas of expertise and contribution
Strong background in finance, technology, strategy
and corporate development and comprehensive
understanding of the key drivers of the business as
a result of his previous leadership positions within
Man Group.
Material external positions
None.
A N
R
R N
A
A N
Richard Berliand
Senior Independent Director (SID)
Laurie Fitch
Independent Non-executive Director.
Lucinda Bell
Independent Non-executive Director
Appointed
January 2016. SID: May 2017.
Background and career
Richard held senior positions at J.P. Morgan for over
23 years, including Global Head of Prime Services,
Global Head of Cash Equities and Chair of the firm’s
Market Structure practice. Richard was a non-
executive director of Rothesay Life plc and Deputy
Chair of Deutsche Börse AG until 2019.
Areas of expertise and contribution
Deep understanding of financial markets, the
regulatory environment, risk management and
technology, gained through senior executive roles in
the financial services sector and a diverse range of
international non-executive positions.
Material external positions
Chair of TP ICAP Group plc*.
Man Group plc | Annual Report 2023
Appointed
August 2023. Remuneration Committee Chair:
October 2023.
Appointed
February 2020. Audit and Risk Committee Chair:
May 2020.
Background and career
Laurie’s background spans asset management and
investment banking, with extensive experience in both
capital markets and M&A. Laurie was a Partner at PJT
Partners until she retired in January 2024 and became
a Senior Advisor. Prior to that, she co-headed Morgan
Stanley’s Global Industrials Group. Before that, she
spent the majority of her career as an Analyst and
Portfolio Manager at Artisan Partners and TIAA-CREF.
Laurie was a non-executive director of EnQuest plc
from 2018 to 2021 where she chaired the
Remuneration Committee.
Areas of expertise and contribution
Extensive experience as an equity investor and banker,
and strong strategic and international perspective.
Material external positions
Senior Advisor at PJT Partners. Non-executive director
of EDP, Energias de Portugal*.
Background and career
Lucinda is a chartered accountant and served as CFO
of The British Land Company plc from 2011 to 2018,
where she also led on sustainability. She was a
non-executive director and Chair of the Audit
Committee at Rotork plc (2014-2020) and a
non-executive director of Crest Nicholson Holdings plc
(2017-2023).
Areas of expertise and contribution
Extensive financial and listed company expertise as
well as valuable experience in ESG matters. Solid
experience as an Audit Committee member and Chair.
Material external positions
Non-executive director and Chair of the Audit
Committee at Derwent London plc*.
Governance Key:
Executive director
Non-executive director
* Quoted on a regulated market
N Nomination and Governance (Chair)
N Nomination and Governance
R Remuneration (Chair)
A Audit and Risk (Chair)
R Remuneration
A Audit and Risk
A N R
N R
73
Alberto G. Musalem
Independent Non-executive Director
Cecelia (Ceci) Kurzman
Independent Non-executive Director
Elizabeth Woods
Company Secretary
Appointed
November 2022. Alberto will step down from the
Board on 29 February 2024.
Appointed
February 2020. Designated employee engagement
non-executive director: March 2022.
Background and career
Alberto founded Evince Asset Management LP and
served as CEO and Co-CIO from 2018 to 2022. Prior
to this, he served as Executive Vice President and
Senior Advisor to the President at the Federal
Reserve Bank of New York. He held a number of
senior positions, including Global Head of Research,
Managing Director and Partner, at Tudor Investment
Corporation and served as an economist at the
International Monetary Fund.
Areas of expertise and contribution
Extensive investment management expertise,
economic and public policy and broad knowledge
of capital markets and regulation.
Material external positions
Non-executive director of Freddie Mac*, a US federal
home loan mortgage corporation founded by the
US Congress.
Background and career
Ceci was Vice President of Global Marketing for Epic
Records at Sony Music Entertainment and prior to this,
held various positions at Arista Records where she led
marketing and artist development functions.
Areas of expertise and contribution
Deep knowledge of marketing, brand management
and technology, specifically digital media and
digital endorsement, and significant experience
with company launches and funding growth
stage businesses.
Material external positions
Non-executive director of Warner Music Group* and
Lanvin Group* and Founder and President of Nexus
Management Group.
Elizabeth joined Man Group in February 2014
as Senior Assistant Company Secretary. She
was appointed Deputy Company Secretary in
March 2017 and became Company Secretary
in August 2019.
Before joining Man Group, Elizabeth held company
secretarial roles at PwC Legal and Capita, where
she was responsible for delivering support and
corporate governance advice to a portfolio of
clients including FTSE and AIM listed companies,
and at Mobeus Equity Partners where she was
Company Secretary of a number of Venture
Capital Trusts.
Diversity of the Board and executive management by gender and ethnicity as at 31 December 2023
Under LR 9.8.6R(10), the Company is required to disclose numerical data on the ethnic background and the gender identity of the
Company’s Board and its executive management. Please refer to page 84 for the Company’s statement on its Board diversity targets
as specified under LR 9.8.6R(9).
Following Robyn Grew’s appointment as CEO, our Executive Committee was restructured and streamlined. This is reflected in the data
below. For the purposes of this reporting, executive management has been defined as all members of the Executive Committee and the
Company Secretary.
The data in the tables below has been collected and compiled in accordance with the UK Listing Rules. This is done annually via voluntary
disclosure and is recorded in our HR platform (Workday).
Reporting table on sex/gender representation
Men
Women
Other categories
Not specified/prefer not to say
Reporting table on ethnicity representation
White British or other White (including minority-White groups)
Mixed/Multiple Ethnic Groups
Asian/Asian British
Black/African/Caribbean/Black British
Other ethnic group, including Arab
Not specified/prefer not to say
Number of
Board members
3
5
0
0
Percentage of
the Board1
37.5%
62.5%
0%
0%
Number of senior
positions on
the Board
(CEO, CFO, SID
and Chair)
2
2
0
0
Number in
executive
management1
8
4
0
0
Percentage of
executive
management
66.7%
33.3%
0%
0%
5
0
0
0
3
0
62.5%
0%
0%
0%
37.5%
0%
4
0
0
0
0
0
10
1
0
0
0
1
83.3%
8.3%
0%
0%
0%
8.3%
1 Robyn Grew and Antoine Forterre are considered both Board and executive management for the purposes of this reporting.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
74
Executive Committee
Implementing our strategy
Executive Committee
Following the announcement in May that Robyn Grew would be taking
over from Luke Ellis as CEO in September, Robyn took the opportunity
to review the structure of the senior leadership team and formed a
new Executive Committee (ExCo), with membership set out opposite.
The ExCo is responsible for implementing the firm’s strategy at a
Group level and communicating the strategy to the Group’s UK/EEA
and Rest of World (RoW) Holding Company (HoldCo) boards for
onward implementation in their respective sub-groups.
The ExCo meets on a frequent basis to maintain its broad operational
oversight of the business, discuss top-level strategic and risk issues
and develop proposals for Board consideration. These meetings
are supplemented by formal quarterly governance meetings held to
provide a forum for the ExCo to review progress on strategy through
various business updates and business spotlight sessions, agree any
matters that should be escalated to the Man Group plc Board and
any matters that need to be communicated to the UK/EEA and RoW
HoldCo boards.
Key decisions and areas of focus during 2023
Key decisions
• Approved multi-year open-source technology development and
product integration agreement with Bloomberg for database
product, ArcticDB1.
• Reviewed 2023 Budget and 2023-25 Medium Term Plan prior to
their submission to the Man Group plc Board for consideration
and approval1.
• Approved funding from Man Group plc to the Charitable Trust1.
• Monitored and assessed acquisition opportunities and considered
the acquisition of Varagon Capital Partners prior to its submission
to the Board for approval. Further information can be found on
page 781.
• Considered and approved the acquisition of a 51% stake in Asteria,
a Geneva-based investment firm and the creation of a strategic
partnership with Fideuram1.
• Discussed and agreed the firm’s future workplace strategy.
Areas of focus
• Debated items to be presented to the Man Group plc Board at
the strategy sessions held during the year.
• Assessed and monitored the financial performance of the firm.
• Agreed actions arising from business unit presentations.
• Considered matters relating to the firm’s people and culture.
• Agreed any actions arising from the Man Group plc Board and
Committee meetings and considered regular reporting from the
UK/EEA and RoW HoldCo boards.
• Discussed the firm’s global strategy to support Board consideration
and decision-making at dedicated ExCo strategy sessions in
November 2023 and January 2024.
1 Approved by Senior ExCo prior to creation of new ExCo.
Man Group plc | Annual Report 2023
Q&A with
Robyn Grew, CEO
Q1. Can you outline the changes you made to the senior management
team following the announcement that you would be taking over from
Luke as CEO?
We have an excellent pool of talent at Man Group and following the
announcement of my appointment as CEO it made sense to review the roles
and responsibilities of the senior management of the firm. This led to the
creation of a new, streamlined Executive Committee (ExCo), with its members
representing the core functions from across the business who will support me
in delivering the firm’s strategic priorities.
As part of my review of the structure, I also made a number of changes to the
roles and responsibilities of several ExCo members:
• Steven Desmyter was appointed as President with his responsibilities
extending to Man Solutions and Responsible Investment in addition to Sales
and Marketing;
• Michael Kasper was appointed Head of Strategy;
• Doug Hamilton has assumed the title of Chief Operating Officer;
• Greg Bond was appointed as Head of Americas in addition to his
responsibilities for Man Numeric;
• Kate Squire was appointed as Head of Non-financial Risk; and
• Gary Collier was appointed as Chief Technology Officer.
The roles and responsibilities of each ExCo member can be found on the
opposite page.
Q2. What is the mandate for the new ExCo?
The ExCo is responsible for the effective management and operation of
the firm as well as fulfilling the key role of developing the firm’s strategy for
Board approval and overseeing its implementation and progress against key
objectives. In my first few months as CEO, my work with the ExCo has been
largely focused on the firm’s strategy as I look to create a clear vision and
roadmap for the firm’s future direction. We held an ExCo offsite in November
and a follow-up session in January 2024, both of which reinforced for me
what a great leadership team we have. Each member of the ExCo has a
deep understanding of the asset management industry and is an expert in
their respective areas. I believe their leadership, support and contribution,
together with their long-standing experience at the firm will be invaluable as
we strive to achieve future successes for the firm.
Q3. Will there be any change in strategy or focus and what role do you
envisage the ExCo having in achieving your vision for the firm?
Man Group has a strong reputation for delivering value to our clients and
this will continue to remain at the heart of everything we do. I have spent
considerable time in my first few months as CEO engaging with our clients to
ensure that their priorities are reflected in the future direction of the firm. We will
also continue to invest in the business, ensuring that we have both the talent
and technology to support our ambitions. We made significant progress on
our key priorities in 2023, and as I undertake my first full year as CEO, I intend
to define and implement, with the help of the ExCo, a clear vision for us to
deliver risk-adjusted returns and differentiated solutions for our clients, to build
our competitive advantage in the industry and to achieve sustainable growth in
the future.
Governance Our Executive Committee
75
Robyn Grew
CEO
Antoine Forterre
CFO
Doug Hamilton
Chief Operating Officer
Key areas of responsibility
Robyn Grew is CEO of Man Group, and an executive
director on the Man Group plc Board. As CEO, she
leads the firm’s Executive Committee and is central to
the delivery of the firm’s strategic ambitions. Robyn
spearheads the firm’s diversity programme, Drive.
Key areas of responsibility
Antoine Forterre is Chief Financial Officer for
Man Group, and an executive director on the
Man Group plc Board.
Key areas of responsibility
Doug Hamilton is the COO for Man Group. In this role,
Doug has oversight of Man Group’s Central Trading
and Execution, Operations, Fund Treasury, Rest of
World Office and Corporate Real Estate teams.
Eric Burl
Head of Discretionary
Gary Collier
Chief Technology Officer
Key areas of responsibility
Eric Burl is Head of Discretionary at Man Group,
responsible for Man’s discretionary division.
Key areas of responsibility
Gary Collier is CTO of Man Group, with responsibility
for all technology and data science across the firm.
Greg Bond
Man Numeric CEO and Head of the
Americas
Key areas of responsibility
Greg Bond is CEO of Man Numeric, Head of the
Americas for Man Group, and a special advisor
to Man Group’s multi-strategy funds. He is also a
member of the Man Numeric Investment Committee.
Kate Squire
Head of Non-Financial Risk
Michael Kasper
Head of Strategy
Key areas of responsibility
Kate Squire is Head of Non-Financial Risk at
Man Group. Her role includes oversight of Global
Compliance, Financial Crime, Operational Risk and
Resilience, Information Security and ESG Infrastructure
at Man Group.
Key areas of responsibility
Michael Kasper is Head of Strategy with responsibility
to define and oversee Man Group’s strategic priorities.
Russell Korgaonkar
Man AHL Chief Investment Officer
Key areas of responsibility
Russell Korgaonkar is Chief Investment Officer of
Man AHL, with overall responsibility for investment
and research. He is also a member of Man AHL’s
management and investment committees.
Steven Desmyter
President
Tania Cruickshank
General Counsel
Key areas of responsibility
Steven Desmyter is the President of Man Group and
the Chair of the Man Charitable Trust. Steven oversees
Man Solutions and leads Man Group’s approach
to responsible investment and research. Steven
also manages the global sales and marketing
distribution strategy.
Key areas of responsibility
Tania Cruickshank is General Counsel at Man Group.
Tania leads the legal teams working in Man Group’s
offices in London, New York, Hong Kong and
Pfäffikon, Switzerland.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 76
Board activities
Key activities of the Board during 2023
Strategy and business development
Risk management
Conducted strategy review
Assessed the strategic position of the firm, including industry trends, the
geopolitical environment, long-term objectives, and required capabilities
to achieve ambitions.
Assessed impact of US banking crisis
Assessed impact of market moves and US banking crisis on Man Group
performance and considered Man Group’s risk positioning.
1
2
3
4 C S E C E B R
1
2
3
4 C S E R
Assessed progress against strategic plans
Assessed progress against the strategic objectives of the firm, including
reviews of the investment engines and business functions. CEO and CFO
reports presented at each meeting, alongside topic specific deep dives to
assist with the ongoing assessment.
1
2
3
4 C S E C E B R
Considered external perspectives on the market environment
Considered current industry trends, including industry performance,
investor sentiment and long-term market evolution.
1
2
3
4 C S
Reviewed M&A strategy and opportunities
Determined M&A strategy and considered opportunities.
1
2
3
4 C S E
Approved Varagon acquisition
Reviewed and approved acquisition of Varagon and received update on
integration objectives and supporting governance framework.
1
3 C S E R
Considered Group Operations update
Received updates on the department’s 2022 achievements and 2023
objectives. Areas of focus included service excellence, efficiency and
departmental talent attraction and retention.
1
2
3 C S E C E B R
Considered Investor Relations update
Reviewed Man Group in the context of the UK equity market, the broader
market positioning, and the firm’s key IR priorities.
1
2
3
4
C S
Reviewed Man Group’s principal and emerging risks
For further information see pages 28 to 35.
Examined the potential impact of emerging risks and discussed and
challenged the firm’s principal risks.
1
2
3
4 C S E C E B R
Assessed effectiveness of risk management and
internal controls
For further information see page 28.
Reviewed Man Group’s systems of risk management and internal controls
and concluded that these continued to be effective.
1
2
3
4 C S E C E B R
Reviewed risk appetite and governance framework
Approved revised risk appetite and governance framework.
1
2
3
4 C S E C E B R
Financial performance
Approved 2023 Budget and 2023 – 25 Medium Term Plan
(MTP)
Approved the 2023 Budget and 2023-25 MTP having reviewed the
underlying assumptions for net flows, performance, revenue margins and
costs.
3
4 C S E C E B
Approved FY 2022 year-end results and 2023 interim results
Reviewed, challenged and approved the 2022 Annual Report and the
2023 interim results.
Evaluated ESG and RI strategies and initiatives
For further information see pages 44 to 67.
4 C S E
Received updates on the firm’s ESG and RI strategies, considered key
trends and Man Group’s ESG ratings. Evaluated the firm’s ESG ambitions,
performance and opportunities.
1
2
3
4 C S E C E B R
Recommended and approved final and interim dividends
Recommended the 2022 final dividend to shareholders which was
approved at the 2023 AGM. Approved payment of the 2023 interim
dividend.
4 S
Reviewed balance sheet deployment
Reviewed Man Group’s seed book, balance sheet, investments and
funding in the context of the firm’s growth strategy, and agreed an
appropriate approach.
1
2
3
4 C S
Approved revolving credit facility (RCF) extension
For further information see page 78.
Reviewed and approved increased RCF of up to $800 million.
1
2
3
4 C S E C E B R
Man Group plc | Annual Report 2023
Governance 77
People and culture
Approved appointment of Chair
Noted the retirement of John Cryan and approved the appointment of
Anne Wade as Chair of the Board.
1
2
3
4 C S E C E B R
Approved appointment of CEO
For further information see page 5.
Noted the retirement of Luke Ellis and approved the appointment of
Robyn Grew as CEO of Man Group.
1
2
3
4 C S E C E B R
Considered findings of independent Board review
For further information see page 86.
Key to strategy:
1 Innovative investment strategies
2 Strong client relationships
3 Efficient and effective operations
4 Returns to shareholders
Key to stakeholders:
C Clients
S Shareholders
E Employees
C Communities
E Environment
Discussed findings of independent review of the Board’s culture and
governance arrangements, agreed actions and monitored progress on
achieving actions.
B Business partners and suppliers
R Regulators
1
2
3
4 C S E C E B R
Approved appointment of non-executive director
Discussed and approved the appointment of Laurie Fitch as a non-
executive director, recognising the skill set she brings to the Board to
support the delivery of the firm’s strategy.
1
2
3
4 C S E C E B R
Reviewed firm culture
Reviewed Man Group’s culture, with a focus on diversity, equity and
inclusion. Considered various initiatives aimed at listening to and
supporting employees.
3 E C
Reviewed employee engagement model and key themes
arising from employee engagement feedback
For further information see page 80.
Discussed key themes identified from the Board’s engagement
with employees around the world. Considered the current engagement
model in the context of broader market practice. Agreed actions to
address feedback.
3 E
Approved executive directors’ objectives
Discussed, challenged and approved the executive directors’ objectives.
3
4 C E
Approved employee Sharesave Offer 2023
Approved the offer of the 2023 Sharesave scheme to all
eligible employees.
3
4 E
Board activities
Innovative investment strategies
Strong client relationships
Efficient and effective operations
Returns to shareholders
Governance and other
24%
22%
21%
20%
13%
¬ For more information on our strategy see pages 2 and 3.
¬ For more information on our stakeholder groups see pages 78 to 83.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 78
Stakeholder engagement
Our key stakeholders
The Board believes that engaging with stakeholders is crucial to Man Group’s
business, enabling better decision-making for the long-term benefit of the Company
and its stakeholders.
Consequences of decisions in the long term
The Board has demonstrated its awareness of the likely
consequences of its decisions over the long term as part of
its consideration of Man Group’s strategy and business model
as set out on pages 10 to 11 and 14 to 15. The Board held
designated strategy days in June and September 2023 to
consider the long-term strategic direction of the firm. As part
of these strategic discussions, the Board considered market
and industry trends and potential impact on stakeholders. These
were reflected in the strategic priorities agreed by the Board.
Details of how the Board has had regard to the following
matters as set out in section 172(1)(a)-(f) of the UK Companies
Act 2006 can be found on the following pages:
Consequences of decisions in the long term – 78.
Interests of employees – 80.
Fostering business relationships – 79.
Impact on the community and environment – 81.
High standards of business conduct – 82.
Need to act fairly between shareholders – 80.
Our section 172(1) statement is integrated across these pages 78 to
83 and sets out who our stakeholders are, how the Board has
engaged with each stakeholder group and any key outcomes. We
have also identified below the principal decisions made by the Board
during the year, and how the Board considered the interests of our
stakeholders when making long-term strategic decisions.
Key to stakeholders:
C Clients
S Shareholders
E Employees
C Communities
E Environment
B Business partners and suppliers
R Regulators
Engagement in action – Principal decisions of the Board
CEO appointment
In May, Luke Ellis notified the Board of his intention to retire as CEO.
The Board implemented its succession plans and approved the
appointment of Robyn Grew, Man Group’s President, as the next
CEO. Robyn took over from Luke on 1 September 2023.
C S E C E B R
Given the CEO’s role in leading the organisation and setting the firm’s
strategy, the Board was aware of the importance of this appointment
to all stakeholders and took this into account during succession
planning discussions, when formalising the role specification and as
part of the appointment process. Particular consideration was given
to the impact on clients, shareholders and employees.
The Board was pleased to approve Robyn’s appointment, given
her previous wide-ranging experience and strong track record of
demonstrating strategic vision and leadership, and will continue to
work closely with Robyn to approve and oversee delivery of the firm’s
strategy during 2024.
Acquisition of Varagon
In July, the Board agreed to acquire a controlling interest in Varagon
Capital Partners, a leading US middle-market private credit manager.
The acquisition was intended to support Man Group’s growth in
US private credit and enhance its investment capabilities with a
complementary US-focused direct lending strategy.
C S E R
Given the strategic importance of the acquisition, the Board
considered the potential impact of the transaction on Man Group’s
key stakeholders. Particular focus was given to the opportunities
that the acquisition and diversified fund range could offer to Man
Group’s existing client base and the extent to which Man Group’s
extensive distribution network and operational expertise could
support Varagon with its continued growth and delivery for clients.
The transaction completed in September with the creation of
Man Varagon, a new investment engine within Man Group’s
existing infrastructure.
C S E C E B R
RCF extension
In December 2023, the Board approved a new Revolving
Credit Facility of up to $800 million. The increase in size reflects
the growth of the business since the previous $500 million
facility was put in place in 2019. As part of the Board’s discussions,
consideration was given to the Company’s balance sheet as a
result of the increased facility and the potential impact to the
Company’s shareholders.
Consideration was also given to the impact of the decision on
employees and the environment. The Board noted that the facility
would become a sustainability linked loan once ESG-related tests
had been specified and agreed. These are expected to align with
the metrics contained in the Executive Director LTIP ESG scorecard.
C S R
Share buyback programme
The Board approved a share buyback programme of up to
$125 million during the year, which commenced in March 2023
and concluded in May 2023. Prior to its approval, the Board
considered the views of the firm’s stakeholders, particularly
those of its shareholders, and deliberated whether the buyback
programme would be considered an appropriate use of capital for
delivering long-term success. Alternative uses of capital were also
discussed, and the Board concluded that the buyback was the
most appropriate option for the firm and reflected the Board’s
confidence in the performance of the firm.
Man Group plc | Annual Report 2023
Governance 79
Outcomes
• The Board continues to have a deep knowledge of the firm’s client
base and client relationships, and how these continue to link to the
firm’s ambitions and strategic goals.
• The Board remains aware of key areas of client focus such as
liquidity, investment risk and ESG. A presentation on ESG and
RI matters held during the year included considerable discussion
by the Board on the differing client views around ESG issues.
• The Board considered possible client impact as part of the CEO
succession and transition process.
• The Board approved the acquisition of Varagon, noting the benefits
of the acquisition on the firm from a client perspective.
Fostering business relationships
Clients are fundamental to our business and represent our most
significant business relationships. The executive directors and
senior management undertake frequent client engagement and
this feedback is considered as part of strategy setting and
long-term decision-making.
The Board also works to foster strong business relationships
with its business partners and suppliers. More information on
our work with business partners and suppliers can be found on
page 82.
The Board considers Man Group’s impact on its supply chain as
part of its annual approval of the Modern Slavery Transparency
Statement.
Clients
Why?
Delivering outperformance for our clients is fundamental to our
corporate purpose. To achieve this, an understanding of our clients’
own investment goals is critical to ensure decisions relating to the
strategic direction of the firm are aligned to those of our clients.
How?
The Board considered the impact of challenging and unpredictable
markets, with frequent changes in sentiment and sharp reversals
during 2023. The Board received regular updates on how the firm
engaged with its clients during these periods of volatility and how
it continued to meet clients’ investment goals, build strong client
relationships and deliver market outperformance.
The acquisition of Varagon during the year has further diversified the
firm’s client offering, by adding a US-focused direct lending strategy.
Further information on the Board’s consideration of the acquisition of
Varagon is set out on page 78.
Client relationships and priorities were a key focus during the Board’s
strategy sessions, recognising the importance of the firm’s long-lasting
and strategic partnerships with its clients and supporting client needs.
The Board delegates most direct engagement with clients to executive
directors and the senior management team. Regular updates on client
interaction and engagement are presented at Board meetings via the
CEO report. During the year, the Board received a detailed
presentation on the firm’s sales activity, which focused on client
sentiment and priorities.
Since her appointment as CEO, Robyn has spent considerable time
engaging with clients to ensure that their priorities are in alignment
with the future direction of the firm.
The Board sought advice and perspectives on current and future
industry and market trends, including the competitive landscape,
in order to anticipate client needs, develop the firm’s strategy and
set objectives accordingly.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 80
Stakeholder engagement continued
Shareholders
Employees
Why?
Why?
As a listed company, the Board is aware of the importance of
institutional and individual shareholders. Central to this is considering
the effective use of capital to deliver long-term success.
We are committed to proactive engagement with our shareholders
and mindful that with a varied shareholder base, it is important to act
fairly between shareholders and consider a variety of needs. Market
trends demonstrate that shareholders are increasingly interested in the
mechanics of decision-making as well as the decision itself, and the
firm is committed to providing shareholders with reliable, timely and
transparent information.
How?
The Board actively engages with Man Group’s largest shareholders
and encourages feedback as part of this engagement process.
Executive directors attend investor roadshows and other investor
events throughout the year. Key topics in 2023 included investment
performance and risk management in challenging financial markets,
the growth of our Solutions offering, the acquisition of Varagon, the
impact of artificial intelligence on our business model, our capital
allocation policy and management changes.
The Board receives regular reports from the Investor Relations
function on the Company’s shareholder base, including key themes
on shareholder sentiment. The Board also held an Investor Relations
deep-dive session during 2023.
Although shareholders are updated via engagement meetings,
electronic communication (including the website), as well as written
correspondence where necessary, the Board recognises that the
AGM is the primary form of formal interaction with shareholders. We
have carefully considered the 2024 Notice of Annual General Meeting,
taking into consideration shareholder views on the resolutions that are
proposed.
Outcomes
• Board received metrics on shareholders as part of monthly
reporting to inform discussion and decision-making.
• Continued proactive engagement with shareholders, led by the firm’s
Investor Relations function, CEO and CFO. 100+ meetings took place
during the year.
• CEO and CFO hosted a dinner with eight long-standing shareholders.
• Introductory meeting with Anne Wade as incoming Chair offered to
top shareholders. Anne met with all shareholders who requested
a meeting.
• Board approved a share buyback programme during the year in
line with the firm’s approach to capital management.
• Board considered shareholder views when discussing the
Pre-Emption Group’s updated Statement of Principles and agreed
not to seek approval for an increase to the non-pre-emptive limits at
the 2023 AGM.
• All resolutions passed at the 2023 AGM receiving over 90%
in favour.
• Board considered shareholder views as part of its deliberations
with respect to the increase of the firm’s revolving credit facility.
Man Group plc | Annual Report 2023
Our employees are integral to the success of the firm. Maintaining
and developing an engaged and motivated workforce, and strong
corporate culture allows us to continue to deliver excellent service
to our clients and maintain high standards of business conduct
throughout the organisation. Listening to and acting upon employees’
views contributes to our ability to attract and retain the best talent and
support long-term success.
How?
In line with our workforce engagement model, Ceci Kurzman was the
non-executive director responsible for leading employee engagement
throughout 2023. Ceci conducted a series of sessions with employees
during the year and shared her feedback from these sessions with
the Board. Further information is provided on page 83. Employees
are also encouraged to share their thoughts and feedback on working
at Man Group with Ceci via email, with the creation of a dedicated
email address. The workforce engagement model was reviewed and
the Board agreed that it continued to be effective way to engage
with employees.
The Board received updates on how the CEO transition and senior
management updates were communicated to employees and
discussed Robyn’s approach to engaging with employees, including
Q&A style townhall meetings and a ‘Robyn’s take’ Slack channel
which contains updates on the firm and the industry more generally.
Townhall sessions were held during the year which focused on the
CEO transition and the firm’s discretionary strategy. Minds at Man
sessions were also held throughout the year which provided a
strategic overview of each of the firm’s investment engines as well
as ESG, Generative AI and investment risk. These sessions enabled
employees to ask questions and share their views with directors and
senior management.
The Board held an in-person breakfast session at the firm’s New York
office in September 2023 where employees were invited to join them
for a coffee and conversation, and were encouraged to ask Board
members questions.
The Board also undertook a review of Man Group’s culture in the latter
part of the year, which supplemented the regular people and culture
updates throughout the year. We also considered and discussed the
results of the staff survey undertaken during the year and the actions
proposed to address the feedback received.
Outcomes
• The Board continues to champion the firm’s diversity, equity and
inclusion initiatives and schedules regular updates from relevant
teams across the firm.
• The Board discussed the outcomes of the 2023 staff survey,
noting the areas of focus for 2024 and agreed actions to
address them.
• The Board considered feedback from Ceci’s employee engagement
sessions. Key themes included positive feedback on the agile
working model, the ability to progress within the organisation
and the positive culture that exists within the firm.
Governance 81
Communities
Environment
Why?
Why?
Charitable efforts are central to Man Group’s ethos and culture. We
have a responsibility to contribute to the local communities in which
we work and have multiple initiatives in place to support this aim.
Man Group recognises the need to be a good corporate, global citizen
and responsible investor, whilst taking into account the needs and
beliefs of our clients.
How?
How?
The Board actively encourages, supports and monitors progress
on initiatives that it believes will have a positive impact on the
communities in which Man Group operates. The Board considers,
and is updated by management on, the firm’s contributions to
communities via charitable partnerships and donations, and
volunteering opportunities for employees (operated by the firm’s
ManKind programme).
Our staff networks host a number of events and initiatives over the
course of the year which celebrate communities globally. These
include events in celebration of Black History Month, Pride and
International Women’s Day, the latter of which included an in-
conversation session with three of our non-executive directors, Anne
Wade, Kate Barker and Jackie Hunt, who shared their views on equity,
allyship and inclusive leadership.
Outcomes
• 400+ Man Group staff volunteered as part of the firm’s ManKind
offering to employees. Employees are entitled to two paid
volunteering days per year. More detail on ManKind can be found
on page 43.
• Man Group works with the #10,000BlackInterns, City Gateway and
Girls Are INvestors Network (GAIN) programmes. Man Group is a
signatory to the Race at Work Charter and is a Disability Confident
Committed employer.
• Ongoing work with a number of schools and charities, including the
King’s Maths School (UK).
• Every employee was offered the opportunity to expense a £250
(or local currency equivalent for those based outside the UK)
donation to a local food bank or homelessness support charity,
with an additional £18,613 donated by employees through various
other fundraising activities in December 2023.
• Man Group’s Corporate Sustainability brochure and Diversity,
Equity and Inclusion Report detail a range of commitments and how
the firm embodies its key principle of ‘responsibility’.
Volunteering opportunities
Each year employees from across the firm are offered the
opportunity to volunteer their time to support charities and
organisations that are striving to make a positive impact in local
communities. Further detail can be found on page 43 and in the
case study on page 83.
The Board has responsibility for the oversight of Man Group’s
environmental impact and monitors progress made against targets.
It regularly discusses ESG and climate-related matters and is provided
with updates from senior management throughout the year. This work
covers the environmental impact of Man Group itself, as well as the
ESG solutions that we offer to our clients.
The firm is an active member of industry groups including the IIGCC,
SBAI, UKSIF and is a signatory to the UN Global Compact and the
UN-supported Principles for Responsible Investment, amongst others.
Man Group is also a signatory of the Net Zero Asset Managers
initiative, a group of asset managers committed to supporting the goal
of net zero greenhouse gas emissions by 2050 or sooner. In 2023,
Man Group was also admitted to the strategic forum for the Taskforce
on Nature-related Financial Disclosures (TNFD), a global and multi-
disciplinary consultative group of institutional supporters who share
the vision and mission of TNFD. More detail can be found on pages
46 to 64.
Outcomes
• ESG matters were discussed regularly at Board and Audit and Risk
Committee meetings during 2023. In November 2023, the Board
received a detailed presentation on RI and ESG matters, from both
a corporate and investment management perspective.
• The Board continues to monitor compliance with ESG targets and
provide challenge where appropriate.
• The Remuneration Committee monitors ESG performance in the
context of ESG-related objectives and metrics as part of executive
director remuneration arrangements.
ESG
Our commitment to ESG is fundamental to our corporate
strategy, both in the way we provide investment services to our
clients and beneficiaries in line with their goals, and as a listed
company ourselves. ESG matters are driven, through the ESG
governance framework, at all levels of the firm and feature in
many of the management meetings we have each year.
We have continued to integrate ESG into our investment
processes in line with client demand, with ESG-integrated
AUM of $59.3 billion. Senior management and individual portfolio
managers are in frequent dialogue with each other and with
clients to ensure a consistent, coherent approach to achieving
ESG targets. We are proud of the focus that ESG has had
within the firm during the year and look forward to our
continued development in this area.
More detail can be found in the Sustainability and Responsibility
section on pages 46 to 47 and 52 to 59.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 82
Stakeholder engagement continued
Business Partners and Suppliers
Regulators
Why?
Why?
Man Group has a long-held reputation for good relationships with
business partners and suppliers. This is important to the Board and
to all employees.
Good relations with business partners and suppliers are essential
to the firm’s effective day-to-day operation. Man Group holds itself
to high standards of business conduct and integrity and it expects
its suppliers and business partners to do the same.
The firm’s products and services are regulated by various global
regulators. Man Group is committed to compliance with its regulatory
obligations and to maintaining open and collaborative communication
with its regulators. We are confident that our employees maintain the
highest standards of conduct, which in turn helps us to meet our
regulatory compliance obligations.
How?
How?
Whilst the Board generally has limited direct engagement with firm
suppliers and delegates this engagement and oversight to senior
management, in September 2023 the Board visited the New York
offices of Bank of New York Mellon (BNYM), a key business partner
of the firm. During this visit, the Board met with BNYM’s CEO and
other members of BNYM’s senior management.
Man Group maintains regular contact with all applicable regulators
and keeps them apprised of any upcoming matters of note.
The Compliance function has delegated responsibility for day-to-day
regulatory reporting matters. The Board and Audit and Risk
Committee receive and consider regular updates from senior
management on compliance matters, including upcoming changes
introduced by regulators that require action.
Man Group has a structure in place comprised of various committees
and policies (including a Supplier Code of Conduct), which together
govern our approach to the risk management of, and engagement
with, suppliers.
Man Group’s induction programme for new non-executive directors
includes a comprehensive overview of Man Group’s legal and
regulatory responsibilities as well as matters of regulatory focus
and development.
The Board, via reporting from the Audit and Risk Committee, is kept
updated on the development of any key supplier risks. Timelines of
payments to suppliers are tracked on a monthly basis within the UK,
the firm’s main country of operation.
A dedicated cyber security team oversees and assesses our
suppliers to ensure they are compliant with the firm’s cyber security
requirements and the Board is kept informed of any developments
via the Audit and Risk Committee.
The Board reviews Man Group’s engagement with its broader supply
chain as part of its annual approval of the Modern Slavery and
Transparency Statement.
Outcomes
• Updates during the year on the open source technology
development and product integration agreement with Bloomberg
for ArcticDB.
• Man Group remains a signatory to the Chartered Institute of Credit
Management Prompt Payment Code.
• Where unresolvable issues arise with existing suppliers, the Board
is made aware via the Audit and Risk Committee of the transition
of business activities to new partners.
Outcomes
• The Board considered the regulatory impact of the CEO transition
and resulting senior management changes.
• The Board and Audit and Risk Committee regularly discussed
regulatory priorities, including the potential impact of anticipated
changes to the UK Corporate Governance Code, the SEC’s Private
Fund Adviser Rules, the Overseas Funds Regime and the CBI’s
Individual Accountability Framework.
• The Board reviewed and approved the Company’s revised Share
Dealing Code and Inside Information Policy.
High standards of business conduct
As an asset management company, it is vital that our workforce
acts with a high degree of integrity in accordance with our
published business principles. The Board is responsible for
determining the Company’s values and leading by example to
instil a positive culture throughout the organisation which reflects
a reputation of adhering to high standards of conduct. The
policies and practices set out on pages 65 to 67 support
Man Group in upholding these standards.
The Board receives updates regarding corporate culture at
each Board meeting as part of the CEO Report and undertook
a specific review on culture received in December 2023. The
Board also received updates on employee engagement, the
output of the 2023 employee survey and feedback following
engagement with the designated employee engagement
non-executive director.
Man Group plc | Annual Report 2023
Governance 83
Engagement in action – case studies
Employee engagement
Community/volunteering
Ceci Kurzman, our non-executive director responsible for leading
employee engagement, met with various groups of employees
throughout the year, including members of the sales team and
women returning from parental leave.
In September 2023, Ceci met with a group of employees from
Man Group’s Sales team based in Denmark, the Netherlands,
Spain and Italy. The group highlighted the importance they placed
on spending regular time in the London office to build relationships
and feel part of the firm and culture. They also noted the advances
in the firm’s technology in supporting them in working ‘on the go’
and the flexibility that the agile working model offered.
In November 2023, Ceci met with a group of UK-based employees
who had recently returned from maternity leave to discuss the
parental leave and benefits offered by Man Group and the
arrangements to support parents returning to work. Particular focus
was given to the value that employees attached to the gender-
neutral parental leave policy, the support offered by Man Group to
individuals whilst on parental leave, the rising cost of childcare and
potential options to broaden childcare arrangements and benefits.
Ceci summarised the discussions to the Board and, in response
to feedback from the group, a review of the existing parental leave
and benefits relating to childcare is underway. An update will be
provided to the Board in 2024.
Man Group participates in many different programmes, from which
we have selected two as examples.
The Man Group team in Hong Kong SAR has been working
with the Seeds of Art Charity Foundation throughout the year
whose objectives include caring for children and the elderly and
disadvantaged families in Hong Kong; supporting schools in rural
areas; and providing disaster relief and emergency assistance
locally. Overall, three volunteering sessions were held during
the year in support of the charity, bringing together employees
and their families who wish to give back to their community. At a
volunteering event held in October 2023, a team of 21 employees
and their families distributed more than 350 packs of essential
goods to the elderly and disabled in the Lok Fu district of Hong
Kong SAR. The firm continues to be very proud of the charitable
efforts of its staff across the globe.
In the UK, our School and University Outreach volunteering
programme, which is part of our Paving the Way initiative, and is
coordinated across our DE&I (Drive) networks and workstreams.
This programme helps inform young people about the breadth of
careers in the investment and technology industries and is designed
to raise their aspirations, inspiring them to pursue a career in
financial services.
We do this through offering:
• Career talks from a wide variety of our people, spanning all
divisions within Man Group;
• The Art of Selling workshop;
• The Trading Game workshop; and
• Insights Days at our offices for groups of students.
We also offer help to teachers and employees of educational
charities, holding mentoring circles or training sessions on
topics that they request (which often include career progression,
leadership and management).
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 84
Board effectiveness
A skilled, effective and
forward-thinking Board
The Board and culture
The Board recognises that both the maintenance and
development of company culture drives Man Group’s ability to
deliver on its strategic priorities and provides a collaborative and
inclusive environment for all employees. As Man Group continues
to grow, the Board is committed to ensuring that the culture of
the firm is aligned with its core values and is successfully
embedded across the organisation. The Board receives regular
reporting at Board meetings (via the CEO report) and undertakes
a formal review of culture annually. Further information on the
outcomes of this review can be found on page 87. In addition,
feedback is actively sought from employees through the staff
engagement survey and through the workforce engagement
programme. Further information on engagement with employees
through our workforce engagement non-executive director, Ceci
Kurzman, can be found on page 80.
To avoid ‘over-boarding’ and to minimise potential conflicts, all Board
members are required to inform the Chair of any proposed changes
to their external roles, including an indication of the expected time
commitment of any new external role so that an assessment can be
undertaken as to whether the director will continue to have sufficient
time to discharge their duties as a director of Man Group. Any
proposed appointments that are considered to be significant, or
represent potential conflicts, will be assessed by the Board and a
decision taken on the extent to which any such conflicts can be
managed. In addition, the Board carries out a formal bi-annual review
of all such roles and interests to ensure that they do not represent an
unmanageable business conflict or a time commitment which might
prejudice directors’ contributions. Before appointing a new director,
consideration will be given to the prospective director’s other
appointments and interests. The letters of appointment of the
non-executive directors contain provisions specifying the expected
time commitment to firm-related activities.
No additional significant external appointments were undertaken by
Board members during the year.
The Company reports the following diversity target information as
at 31 December 2023:
FCA Listing Rule target
At least 40% of Board directors
are women.
At least one senior Board
position1 is held by a woman.
At least one Board director
is from a minority ethnic
background.
1 Chair, CEO, SID or CFO
62.5% of Board directors
are women.
Chair and CEO are women.
Outcome Group’s position
Target
achieved.
Target
achieved.
Target
achieved.
Three of the Board directors
are from a minority ethnic
background (see page 73).
Board oversight, challenge and decision-making
During the year the Board held 11 formal meetings which included two
strategy sessions and three ad-hoc Board meetings. Where possible,
members were all physically present however, on occasion, members
joined by videoconference where they were unable to attend the
meeting in person. Attendance at these meetings is set out on
page 71.
The Board regularly meets with, and seeks input from, senior
management, subject matter experts and representatives from
key teams. These interactions enable Board members to build
their understanding of Man Group as well as the trends, risks and
opportunities impacting the sector.
Consideration of the Company’s identified stakeholders forms part
of the Board’s decision-making process. Further details on these
groups, together with how the Board engages with stakeholders and
key outcomes during 2023, are set out in the stakeholder engagement
section on pages 78 to 83.
Board meetings are conducted on the basis that all written materials
submitted are thoroughly reviewed by Board members in advance
to maximise the opportunity for discussion at meetings. The non-
executive directors challenge proposals and approaches presented
by management and draw on their experience to suggest alternative
approaches or ideas, where appropriate. Board meetings are
effectively chaired and structured in a manner that encourages all
views to be expressed and heard.
Diversity, equity and inclusion
The Board is a highly skilled, committed and diverse group of
individuals, focused on understanding its own strengths, challenges
and operational style. The Board biographies on pages 72 to 73 and
the analysis of the Board’s composition and skills on page 85 give an
overview of the breadth and depth of talent and experience on Man
Group’s Board. The non-executive directors bring diversity through
wide-ranging contributions and perspectives to Board review and
decision-making from their current executive or portfolio careers.
A mix of different tenures delivers fresh outlooks and challenge,
complemented by a longer-term understanding of the business and
its people. In early 2024, the Board approved a revised Diversity,
Equity & Inclusion Policy which articulates our approach to Board
diversity, equity and inclusion now and in the future. More information
can be found on pages 98 to 99.
Independence and time commitment
All of the non-executive directors are considered to be independent
and the Chair was considered independent on her appointment to
the role. There are a number of ways in which the independence of
our non-executive directors is safeguarded:
• meetings between the Chair and the non-executive directors
without the executive directors being present;
• meetings between each of the directors and the Senior
Independent Director to discuss feedback on the performance of
the Chair;
• separate and clearly defined roles for the Chair and CEO (see page
71 for further details); and
• formal review of independence as part of the process for renewing
the appointment of non-executive directors.
Man Group plc | Annual Report 2023
Governance 85
Board induction process
Continuous development of the Board
All non-executive directors receive a comprehensive and tailored
induction to the business and, if required, the asset management
industry. Induction programmes are structured around one-to-one
briefings with the senior management and the Company Secretary,
with relevant briefing materials circulated in advance and follow-up
meetings arranged where appropriate. New Board members are
invited to provide feedback on the programme they receive to ensure
it is useful and well targeted. They are encouraged to seek updates
on any topics which arise following Board meetings on which they
would like further information. Details of the induction programme for
non-executive directors are given on our website. Executive directors
receive an induction which takes account of their existing skills,
knowledge and experience. In response to Board feedback, the
induction programme was restructured during 2023 and has been
organised in three separate phases. The first phase focuses on core
Board responsibilities and dynamics, governance arrangements and
the Man Group culture/history, and includes meetings with Board
members, the Company Secretary and key advisers. Phase two
focuses on central functions of the business while phase three
focuses on the investment engines. Phases two and three involve
meetings with certain members of the ExCo and the
management team.
Laurie Fitch was appointed as a non-executive director during the
year, and received a tailored induction in the months following her
appointment, which followed the new structure.
Throughout the year, the Board is kept updated on key areas of the
business and regulatory changes through the following methods:
• briefings included within Board papers;
• presentations from senior management and other employees on
specific issues; and
• educational sessions from internal subject matter experts and
external advisers.
The main training topics covered during the year were:
• the hedge fund industry, investor sentiment and industry trends;
• update on developments within corporate governance reporting;
• Consumer Duty implementation; and
• ESG, stewardship and responsible investing.
In addition, opportunities continued to be made available to non-
executive directors to attend seminars and workshops virtually on
topical business and regulatory issues offered by professional services
firms and law firms.
Aggregated skills and experience of Board members as at 31 December 2023
Finance/audit
Legal
Strategy/M&A
HR/reward
Risk
ESG
Compliance/regulatory
Technology
Cyber security
Communications/marketing
Operations
International markets
Financial services/asset
management
UK listed plc
Key to skills and experience:
Extensive experience
Limited experience
Considerable experience
No direct experience
Board tenure
0–3 years
3–6 years
6+ years
12.5%
50.0%
Age
35–44
45–54
55+
37.5%
12.5%
37.5%
50.0%
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 86
Board evaluation
Determining Board effectiveness
An evaluation process is undertaken on an annual basis to
determine the effectiveness of the Board, its Committees, the Chair
and individual directors. The process is either facilitated internally by
the Chair or, every third year by an external organisation. The Board
seeks to continually improve its performance and ensure it is effective
in discharging its duties under the UK Corporate Governance Code.
The review offers an opportunity for individual members to reflect on
the past performance of the Board and identify areas of focus for the
future to enhance the Board’s effectiveness.
Evaluation for the year ended 31 December 2022
In 2022, the Board evaluation process was internally facilitated by the
then Chair, John Cryan. The findings highlighted several areas of focus
and development for consideration during 2023 and progress against
these actions is shown below.
Area of assessment
Agreed actions
Progress made during 2023
Meeting conduct
• Review Board papers to ensure these provide sufficient
• Board feedback indicated that Board papers are of
context and ‘scene-setting’.
extremely high quality, are the right length and contain
the right level of detail. The importance of having
sufficient time to review papers in advance of meetings
was highlighted. Further consideration is to be given to
certain reports to ensure sufficient focus is given to the
performance of key strategies.
• Increase frequency of non-executive director-only
• Non-executive director-only sessions were introduced
sessions at Board meetings.
Management presentations
• Arrange additional management presentations for
non-executive directors outside of Board meetings.
Succession planning
• Enhance structure around director and senior
management succession planning.
at each meeting. Feedback indicated that these
were valuable sessions and suggested that further
consideration should be given to extending them.
• Sessions with portfolio managers held in Q1 with
positive feedback received from Board members.
Additional presentation topics identified for
implementation in 2024.
• Success of the 2023 succession processes and
implementation highlighted consistently in Board
feedback. Continue to focus on Board succession
in 2024.
Strategy
• Focus on longer-term strategic priorities and tracking
progress against these.
• Positive feedback received on the progress that
has been made in 2023 and continued focus in
2024 with significant amount of Board time spent
on strategy discussions.
Independent Board review 2023
During the year, the Board commissioned an independent review of
the Board’s culture and governance arrangements. The review, which
was separate from the annual Board evaluation, was jointly facilitated
by Clare Chalmers and A&O Consulting, and involved interviews with
individual Board members and other key stakeholders, with a
summary of key findings presented to the Board.
The review concluded that the Board was engaged and of a high
quality, and that the governance processes supporting its operation
were effective. It noted that there was recognition of the important role
that the Board played in providing scrutiny and challenge to the
executive, and a consistent view that the executive responded well to
challenge and reacted appropriately when it was given.
The review set out the following recommendations for the Board
to consider:
• increase the pool of executive search firms used to support
non-executive search processes;
• extend the membership of the Nomination and Governance
Committee to include the rest of the existing non-executive
directors;
• enhance the non-executive director induction programme
to include additional focus on firm and Board culture; and
• ensure that appropriate information is shared with all Board
members outside formal Board and Committee meetings,
particularly in the case of significant externally driven events.
The Board found the review to be a valuable exercise and agreed with
the recommendations set out in it. These were implemented during
2023 and early 2024.
Man Group plc | Annual Report 2023
Governance 87
2023 Board effectiveness evaluation
1 Design and initiate process
2 1:1 meetings
3 Discussion, outcomes and actions
Board members were advised of the themes
(highlighted below) to be discussed with the Chair
at individual meetings to enable Board members to
prepare for their meetings.
The Chair met with each Board member to discuss
feedback and any other additional items they
wished to raise. The Senior Independent Director
also met with each Board member to discuss the
Chair’s leadership of the Board.
The Board discussed the findings of the review.
Strengths and actions relating to development
areas were agreed upon. Key findings and
development areas are set out below.
Key findings
• Board and Committee performance is strong, members are engaged
and supported by a well-established executive team who produce
consistently high-quality papers, presentations and supporting materials.
Members facilitate rigorous debate and challenge, fostering an open and
transparent culture.
• The Board’s visit to New York was a success with plans to revisit the US
in Q3 2024.
• Board and executive succession planning, implementation of firm’s
strategy and increasing firm performance discussions were identified as
key areas of focus for 2024 (further details below).
• Details of the key findings of the Committee evaluations are set out in the
individual Committee reports.
Summary of internal effectiveness development areas for 2024
Area of assessment
Key findings
Agreed actions
Performance
• Increase focus and discussion on absolute and relative
• Review and enhance performance data and reporting
firm performance.
in Board reports.
• Further strengthen understanding of investor views
during Board discussions.
• Continue to hold investor relations deep-dive each year
and introduce investor commentary in Board reporting
where appropriate.
Strategy
• Significant time and focus dedicated to Man Group’s
strategy in 2023 following Robyn Grew’s appointment
as CEO.
• Continue to focus on longer-term strategic priorities and
tracking progress against these in 2024.
• Agree strategic priorities and support and
oversee implementation.
• Agree key milestones and accountability to enable
the Board to assess progress, whilst recognising
the importance of retaining flexibility to respond to
new opportunities.
Succession planning
and leadership
• Continue to build on the Board’s existing skills
and experience.
• Encourage management voices and views from across
the organisation.
• Progress non-executive searches for individuals with
deep markets experience and strong accounting
experience, acknowledging that this may involve the
appointment of multiple individuals at similar times.
• Increase exposure to and engagement with all ExCo
members and other members of the senior
management team.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 88
Audit and Risk Committee report
Lucinda Bell
Chair, Audit and
Risk Committee
The ARCom devoted significant time to
the oversight of acquisition accounting and
integration matters following the strategic
investments made by the firm in 2023.
Summary of the ARCom’s main activities during 2023
• Monitored the financial information within Man Group’s 2023 interim
and annual financial statements and challenged the key accounting
policies, judgements and estimates adopted by management, with a
particular focus on acquisition accounting judgements. Concluded
that the statements were fair, balanced and understandable, and
recommended their approval to the Board.
• Monitored and reviewed the effectiveness of the firm’s risk
management systems and internal controls.
• Conducted a robust assessment of principal and emerging risks.
• Approved the 2023 Internal Audit Plan and reviewed the Internal Audit
model. Received regular updates on the progress of Internal Audit
reviews and monitored management’s response to address actions.
• Recommended the reappointment, and approved the remuneration,
of Deloitte as external auditor.
• Approved the 2023 external Audit Plan.
Membership:
Lucinda Bell (Chair)
Richard Berliand
Laurie Fitch
Alberto G. Musalem
Proportion of the committee time spent on key responsibilities
1. Risk management
2. Financial reporting
3. External audit
4. Internal audit
55%
21%
11%
13%
1
4
3
2
Man Group plc | Annual Report 2023
Dear Stakeholder
I am pleased to present the report of the Audit and Risk Committee
(the ARCom). The ARCom plays a key role in assessing the integrity
of Man Group’s financial reporting, monitoring the effectiveness of
the firm’s systems and processes of risk management and internal
controls, and reviewing and monitoring the activities of the Internal
Audit function and the external auditor.
Firstly, I would like to welcome Laurie Fitch, who became a member
of the ARCom in August 2023. The ARCom has benefited from her
previous experience and fresh insights. Kate Barker and Jackie Hunt
stepped down from the ARCom during 2023, and Alberto Musalem
will step down on 29 February 2024. I would like to thank them all for
their valued contributions to the ARCom during their tenures.
Key achievements for 2023
Throughout the year, the ARCom closely monitored risks arising from
the volatility of financial markets following interest rate rises in 2022,
notably in the context of the US banking crisis in March 2023. The
Committee scrutinised the controls in place to navigate the challenges
presented by this environment, with liquidity, counterparty, and
geopolitical risks all being themes that continued to feature
prominently in the ARCom’s work during the year.
Following the announcement of Robyn Grew’s appointment as CEO,
the ARCom reviewed the implementation of senior management
changes, with a focus on the restructuring of the risk functions which
included the establishment of the position of Head of Non-Financial
Risk with a widened scope of responsibilities.
The acquisition of Varagon and investment in Asteria during the
year necessitated close ARCom oversight of acquisition accounting
judgements, further details of which can be found on page 90.
The ARCom also reviewed management integration plans to ensure
appropriate implementation of the firm’s risk controls across new
business units.
We also maintained a focus on cyber and information security risk matters,
providing oversight to further enhancements of the firm’s controls and
closely monitoring live industry-wide threats. The ARCom also reviewed
the firm’s usage of GenAI and the policies and controls in place to ensure
risks associated with the technology are mitigated.
The ARCom devoted significant time to the oversight of regulatory
developments during the year, including in respect of the future of the
UK audit and financial oversight regime, and the SEC’s new Private
Fund Adviser rules.
Focus areas for 2024
For 2024, as well as considering the standing items of business,
the ARCom will focus on the following areas:
• monitoring regulatory developments in respect of Private Fund
Adviser Rules in the US and UK corporate governance reforms;
• monitoring the integration of new business units to ensure
consistent implementation of risk controls;
• assessing geopolitical and economic risk factors which will impact
the firm and its stakeholders; and
• undertaking the external quality assessment of the outsourced
Internal Audit model to ensure it remains appropriate for the firm’s
structure and risk environment.
I hope you find this report a useful insight into the work of the ARCom
and I look forward to continuing our work in 2024.
Lucinda Bell
Chair, Audit and Risk Committee
Governance 89
How the ARCom operates
Forward agenda • Covers key events in the financial reporting cycle, specific risk matters and standing items set out in the ARCom terms of reference.
• Reviewed as part of an open discussion with ARCom members and updated in response to changing business risks and priorities.
Agenda setting
meeting
• Held in advance of each ARCom meeting to identify key issues impacting the business that may require consideration by the ARCom.
• Attended by the ARCom Chair, CFO, Head of Non-Financial Risk, Head of Internal Audit, representatives from Deloitte (as external
auditors) and the ARCom Secretary.
Briefing
sessions
Committee
meetings
• Prior to each ARCom meeting, the ARCom Chair meets with the ARCom Secretary to discuss the meeting papers, consider any
particular matters of concern and identify those matters which require meaningful discussion at ARCom meetings. The ARCom Chair
also has one-to-one briefings with the presenters where necessary.
At each meeting, the ARCom considers:
• reports and presentations on key financial reporting, risk, compliance and audit matters from management;
• standing governance items;
• regular dashboards and/or metrics which highlight and monitor changes in the key risks impacting the business, compliance,
ESG and RI risk matters, the financial controls framework and internal controls; and
• ‘deep-dive’ assessments of topical risk items identified by the ARCom and management.
Board reporting • The Board is updated by the ARCom Chair on the key areas of discussion with recommendations made, as appropriate.
Training
• ARCom members periodically attend training sessions delivered by industry experts on audit and regulatory matters, as well as other
items of interest.
Roles and responsibilities
Financial
reporting
Risk
management,
internal controls
and compliance
• Review the integrity of the Company’s interim and year-end financial reports and statements, and recommend their approval to the
Board.
• Review and report to the Board on the effectiveness of the firm’s systems of risk management and internal controls.
• Review the effectiveness of the firm’s Risk and Compliance functions, regulatory reporting activities and channels available for its
workforce to raise concerns.
Internal Audit
• Approve the annual Internal Audit Plan and review the effectiveness of the Internal Audit function and management’s response to
their findings.
External audit
• Recommend to the Board the appointment, and approve the remuneration, of the external auditor, including reviewing the external
auditor’s effectiveness and independence.
Membership
The members of the ARCom are Lucinda Bell (Chair), Richard
Berliand, Laurie Fitch and Alberto Musalem (who will step down from
the ARCom on 29 February 2024).
The ARCom as a whole has a combined skill set relevant to the sector
in which the Group operates and Lucinda, as Chair of the ARCom,
has recent and relevant financial experience for the purposes of the
2018 UK Corporate Governance Code (the Code). Further details of
the ARCom members’ experience and areas of expertise are provided
on pages 72 and 73.
The Board Chair, CEO and CFO are invited to attend ARCom
meetings along with the Head of Internal Audit and representatives
from Deloitte, in their capacity as Man Group’s external auditor. Other
members of the management team attend for those items that are
relevant to them. The ARCom meets periodically during the year with
the Head of Internal Audit and representatives from Deloitte without
management present.
Roles and responsibilities
The ARCom is fundamental to Man Group’s governance framework
through its monitoring of financial reporting, the relationship with the
external auditor, the effectiveness of risk management and internal
Man Group plc | Annual Report 2023
controls, and the monitoring of the Internal Audit and Compliance
functions. A high-level summary of the ARCom’s roles and
responsibilities is outlined above, together with an explanation of
how it has discharged its responsibilities during the year. Full terms of
reference for the ARCom, which are reviewed on an annual basis and
were approved by the Board in December 2023, are available on the
Company’s website.
How the ARCom has discharged its roles
and responsibilities
Financial reporting
Key accounting and disclosure matters
The ARCom reviewed the key accounting policies, judgements and
estimates adopted by management as part of the monitoring of the
integrity of the financial information contained in the interim and annual
financial statements. The appropriateness of the disclosures in the
financial statements were also reviewed. A fundamental judgement
applied in preparing the financial statements is the appropriateness
of adopting the going concern assumption. The ARCom’s actions in
relation to this judgement are outlined below together with the other
key areas of judgement, estimation and disclosure.
Strategic report | Governance | Financial statements | Shareholder information 90
Audit and Risk Committee report continued
Key accounting and disclosure matters
Matters considered
Action
Outcome
The ARCom considered forecast financial performance, net
financial assets and liquidity resources and requirements across
a range of scenarios to assess the impact on the short- and
medium-term ability of the business to continue in operation and
meet its financial obligations as they fall due. The ARCom also
reviewed management’s approach to how the committed cash
outflows arising from the two acquisitions in the period are
incorporated in long-term liquidity planning.
The principal and emerging risks, which are outlined on pages
30 to 34, all of which are monitored by the Board on a regular
basis, were considered, selecting the appropriate range of
scenarios to assess in the context of going concern and viability.
The ARCom also reviewed the going concern disclosure in the
financial statements and viability statement in the Annual Report
(as set out on pages 143 and 35).
After due consideration, the ARCom confirmed
to the Board that it was appropriate for the
Group financial statements to be prepared on
a going concern basis. The ARCom reviewed
the going concern disclosure in the financial
statements and confirmed it appropriately
reflected the judgement applied.
After discussion and having considered the
firm’s prospects, emerging and principal risks,
forecast capital position and liquidity resources
and requirements, the ARCom concluded that
the three-year assessment period, in line with
the firm’s business planning horizon, remained
appropriate and recommended the draft viability
statement to the Board for approval.
Going concern and viability
Judgement is exercised when considering the
ability of Man Group to continue in operation and
meet its financial obligations as they fall due over
the 12-month period following the approval of the
financial statements, and therefore in determining
whether it is appropriate to apply the going
concern assumption in their preparation,
as disclosed in Note 2 of the Group
financial statements.
Further judgement needs to be applied when
assessing the viability of the business over the
course of the next three years, and therefore the
appropriateness of the viability statement on page
35, particularly as the ability to accurately forecast
financial performance diminishes for periods
further into the future.
¬ Please refer to Note 2 in the Group financial statements
for further details
Acquisition accounting
Man Group acquired a controlling interest in two
businesses in the year, Varagon and Asteria. Both
transactions are treated as business combinations
in the Group financial statements. As the
accounting for the acquisition of Varagon is
particularly complex, significant attention was
given to determining the appropriate treatment,
involving the application of critical judgement.
The accounting for the acquisition of Varagon
is considered to be both a critical accounting
judgement and a source of significant uncertainty,
as disclosed in Note 3 of the Group financial
statements.
The ARCom reviewed and challenged the judgements applied
by management in accounting for each of the transactions. In
particular, the ARCom challenged the treatment of payments to
the Varagon sellers who are also employees as post-acquisition
remuneration rather than as transactions with owners. The
ARCom also considered the assumptions used in valuing these
employment-related expenses, which are a source of significant
estimation uncertainty given their link to the expected future
value and performance of the Varagon business. The ARCom
considered the complexity the accounting treatment adds to
the interpretation of Man Group’s results, and management’s
proposal to use alternative performance measures (APMs) to
assist with this.
The ARCom further considered the judgement applied by
management in accounting for future payments to the sellers
who are also key clients as payments to them in their capacity as
customers rather than sellers.
The ARCom considered management’s assessment of the
accounting for the non-controlling interest and associated
put option in Asteria, including the judgement applied when
determining that the non-controlling interest was not material
for separate disclosure in the Group financial statements.
The ARCom reviewed the disclosures in Notes 3 and 17 in the
Group financial statements, which provide details of the critical
accounting judgements and estimates, and of the business
combinations themselves, respectively.
Consolidation of investments in funds
Man Group holds investments in a number of
funds which it manages for seeding, co-invest,
or risk retention requirements. Judgement is
exercised when assessing whether certain
investments are controlled by Man Group and
therefore need to be consolidated into the financial
statements. This is considered to be a critical
accounting judgement, as disclosed in Note 3
of the Group financial statements.
¬ Please refer to Note 12.2 in the Group financial
statements for further details
The ARCom reviewed management’s assessment of any new
judgements made in assessing investments Man Group is
deemed to control in accordance with IFRS 10 ‘Consolidated
Financial Statements’ and the disclosure of these assessments
as a critical judgement in the financial statements. Of particular
focus in the year were the CLOs which were consolidated into
the financial statements, introducing significant new balances to
the Group balance sheet in both the Interim and Annual Reports.
The ARCom also considered the appropriateness of the use of
APMs to exclude the impact of the consolidation gross-up,
thereby reflecting Man Group’s maximum exposure to loss
associated with the consolidated fund entities.
Pension valuation assumptions
Man Group has defined benefit pension plans in
the UK and Switzerland, which are well funded and
result in a net pension asset. The assessment of
the actuarial assumptions applied in valuing these
plans determines the carrying value on Man
Group’s balance sheet and is considered to be a
critical accounting estimate, as disclosed in Note 3
of the Group financial statements.
¬ Please refer to Note 23 in the Group financial
statements for further details
The ARCom discussed and agreed with management the
pension valuation assumptions applied by our external actuarial
experts, noting that these are in the middle of the range of
established market practice and fairly reflect the valuation of
our pension assets and pension obligations in accordance with
IAS 19 ‘Employee benefits’. The ARCom also considered the
disclosure of the valuation of the net pension asset as a critical
accounting estimate in the Group financial statements.
The actuarial assumptions underlying the valuation of the defined
benefit pension plans were updated at 31 December 2023 to
reflect the impact of microeconomic factors, most notably on
inflation and mortality assumptions.
Man Group plc | Annual Report 2023
After debating the resultant accounting
treatment, the ARCom concluded that it was
satisfied with management’s application of
the requirements of IFRS and concurred with
management’s proposal to use APMs, further
considered below, to assist in understanding the
economic substance of the transactions and the
cash flows in each accounting period.
The ARCom agreed with management’s
assessment that future payments to sellers
should be treated as deductions from future
revenues, rather than being included in the
acquisition accounting.
The ARCom considered the application of
materiality to the accounting for the Asteria
transaction and concurred with management’s
assessment that the non-controlling interest was
not material for separate disclosure in the Group
financial statements.
The ARCom further confirmed that it agreed with
the appropriateness of the disclosures in Notes
3 and 17 of the Group financial statements.
The ARCom concluded that it was satisfied
with management’s assessment of the
vehicles which are deemed to be controlled
by Man Group, the associated accounting
treatment and the critical judgement disclosure
in the financial statements. 35 investments have
been consolidated on a line-by-line basis with a
grossing up impact on the balance sheet of
$1,492 million.
The ARCom agreed that CLO liabilities held
by funds controlled by the firm should be
presented in a new line in the Group balance
sheet. As the CLO assets are similar in nature
to the assets held by the other consolidated
funds, the ARCom agreed with their inclusion
within Investments in fund products and
other investments.
The ARCom confirmed that it agreed with
the external valuation assumptions applied in
determining the carrying value of the net pension
asset, as set out in Note 23, and the critical
accounting estimate disclosure in Note 3 to the
Group financial statements.
Governance 91
Matters considered
Action
Outcome
Impairment assessment of goodwill
Testing for impairment is undertaken at least
annually through the application of a ‘value in use’
model. This requires estimates of future cash flows,
growth rates and associated discount rates. The
two acquisitions in the year have increased the
value of goodwill held on the Group balance sheet,
which has been tested for impairment as a single
group of cash-generating units (CGUs).
¬ Please refer to Note 18 in the Group financial
statements for further details
Deferred tax assets (DTA)
Man Group has deferred tax assets in the US
which largely represent historical tax losses and
future deductions for amortisation of goodwill and
other intangible assets that will reduce the tax
payable in the US. The value of the US DTA
recognised requires judgement regarding the
assessment of probable future profits.
¬ Please refer to Note 20 in the Group financial
statements for further details
Impairment of right-of-use (ROU) lease asset
– investment property
Man Group sub-leases a portion of its Riverbank
House premises and assesses at the end of each
reporting period whether there are any indicators
that the associated ROU lease asset may be
impaired. If any such indicator exists, the estimated
recoverable amount of the ROU lease asset is
calculated using future sub-lease cash flows.
¬ Please refer to Note 16 in the Group financial
statements for further details
Alternative performance measures
Man Group assesses its performance using a
variety of APMs, most significantly core EPS. The
Board focuses on core profit as this reflects the
revenue and costs that drive Man Group’s cash
flows and inform the basis upon which its variable
compensation is assessed.
¬ Please refer to pages 175 to 179 for further details
Consideration of climate change impact on
accounting estimates and assumptions
Man Group considers and assesses the impact
of climate change as part of its broader risk
governance framework which captures both
short- and longer-term risks. This assessment
informs the Board’s judgement as to whether
climate change impacts the accounting estimates
and assumptions used in the financial statements.
¬ Please refer to Note 3 in the Group financial statements
for further details
The ARCom considered reports from management outlining the
methodology for the impairment assessment and the rationale
for testing a single group of CGUs. The ARCom also challenged
the assumptions underpinning the goodwill valuation model
including cash flow projections, discount rates, the cost
allocation methodology, and levels of available headroom.
The ARCom agreed that it was appropriate that
no impairment was recognised for the year
ended 31 December 2023.
The ARCom reviewed the assumptions underpinning the
future forecast profits which supported the valuation of the US
DTA and considered management’s assessment of the expected
timing of forecast profits, including the impact of the acquisition
of Varagon in the year, and the expiry of certain US tax losses
over time.
The ARCom confirmed that it was satisfied
that the methodology adopted continued to be
appropriate. A credit to the income statement of
$19 million was recognised in the year due to the
recognition of DTAs following changes in
forecast future profits, including the impact of
the acquisition of Varagon in the year.
The ARCom discussed and challenged management’s
assumptions around the timing and rental values which drive
future cash flows and the discount rate applied to the cash flows.
The ARCom also noted that the firm had signed new leases
with sub-tenants for space in Riverbank House which extend for
almost all of the remaining period of the head lease with no break
options, which resulted in the derecognition of the associated
ROU lease assets for this space and the recognition of a
resultant gain on disposal.
The ARCom noted that, as a result of the derecognition, the
carrying value of Man Group’s investment property ROU lease
assets at 31 December 2023 was immaterial.
The ARCom confirmed that it agreed with
management’s judgements in determining that
there were no indicators of impairment in relation
to the ROU lease asset for investment property
at 31 December 2023, and therefore that there is
no impairment expense to be recognised for the
year then ended.
The ARCom also confirmed it agreed with
management’s proposed accounting for
the finance leases which commenced in the
year and the inclusion of the gains on disposal
of the ROU assets as non-core items in
Man Group’s APMs.
The ARCom reviewed and discussed the APMs contained in the
Interim and Annual Reports, including the appropriateness of
their definition, application and disclosure. The ARCom further
discussed the treatment of costs related to business
combinations in the year in the APMs.
The balance between the use of APMs and the use of statutory
measures when discussing Man Group’s financial results in the
year was also considered.
In making this assessment, the ARCom considered a paper
prepared by management which compared core profit to
operating cash flows for the last five years.
The ARCom reviewed the possible impact of climate change on
accounting estimates and assumptions.
The ARCom noted that core profit over the last
five years was broadly consistent with operating
cash flows and therefore concluded that the
APMs, including core profit, were appropriate,
provided a fair assessment of the operating
performance of the business and were
appropriately defined and reconciled to statutory
measures as disclosed on pages 175 to 179.
The ARCom confirmed that it concurred with
management’s assessment of non-core items
arising from the business combinations in
the year.
The ARCom concluded that an appropriate
balance and level of prominence was presented
across statutory and core measures.
The ARCom confirmed with respect to the
impact of climate change that there are no
key assumptions concerning the future or other
key sources of estimation uncertainty at the
reporting date that may have a significant risk of
causing a material adjustment to the carrying
amounts of Man Group’s assets and liabilities
within the next financial year.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 92
Audit and Risk Committee report continued
Fair, balanced and understandable assessment
At the request of the Board, the ARCom reviewed the interim
and annual financial statements in conjunction with the narrative
sections of the Interim and Annual Reports to ensure that there
was consistency in the information reported, that sufficient weight
had been given to both positive and negative aspects of business
performance, that there was an appropriate balance between
statutory and alternative performance measures, and that key
messages had been presented coherently. The ARCom concluded
that, taken as a whole, the Interim and Annual Reports were fair,
balanced and understandable and provided the information
necessary for shareholders, and other stakeholders, to assess Man
Group’s position and performance, business model and strategy.
Climate-related disclosures
Pursuant to the ARCom’s delegated authority from the Board to
monitor compliance with regulations and disclosures related to
climate, sustainability and ESG, the Committee reviewed the GHG
emissions and TCFD disclosures contained in the Annual Report.
KPMG were engaged to assist in the assurance of the GHG emissions
disclosures, which were presented to the ARCom for approval
at its February 2024 meeting. Further details on these disclosures
can be found in the Sustainability and responsibility section on
pages 44 to 61.
European Single Electronic Format (ESEF)
The ARCom was briefed on the process supporting the preparation
of the consolidated financial statements in digital form under
ESEF. Robust procedures and controls are in place to support the
preparation and review processes to ensure high-quality and timely
filing in line with the requirements of the regulation and the FRC’s
recommendations of best practice, including full review of the
tagged file and challenge of the judgements made by the
outsourced tagging provider.
Correspondence with the FRC
The audit of the 2022 financial statements was selected for quality
review by the FRC, pursuant to which the ARCom Chair met with the
FRC’s supervision team in May 2023. The output of the review fed into
the broader audit quality inspection report published by the FRC in
July 2023. There were no findings communicated in respect of the
Man Group audit. The areas identified in the FRC’s ‘Annual Review of
Corporate Reporting 2022/2023’ publication were reviewed, however
no specific changes were required to Man Group’s draft accounts as
a result.
Risk management and internal controls
Monitor and review of risk and control environment –
key business areas
As ever, the ARCom was responsive to the changing needs and risk
profile of the firm in discharging its risk management role, exemplified
by its focus on integration risks following the strategic transactions
undertaken by the firm during the year. Macroeconomic and market
risks continued to be closely monitored, with an emphasis on the
impact of such dynamics on counterparty and liquidity risk. Key
areas of risk-based discussion are set out below.
Integration risk
As a result of the firm’s investments in Varagon and Asteria during
the year, the ARCom requested an assessment of the risks arising
from the integration of the businesses into the operations of the wider
firm. Several high priority near-term risks were identified, as well as
longer-term risks which the ARCom will continue to monitor as risk
controls and processes are integrated with those of the wider firm.
In recognition of the importance of swiftly embedding a collaborative
culture, emphasis was given to the consideration of cultural integration
risks and the measures taken by management to ensure new teams
were integrated at the earliest opportunity.
The Committee also worked with management to incorporate
integration risk as an additional business risk in the firm’s principal
risks register to ensure additional focus because of the increased risk
in this area during 2023.
Counterparty and liquidity risk
Throughout the year, the Committee closely monitored
macroeconomic and market dynamics and their impact on the firm’s
counterparty and liquidity risk profile.
Following the March 2023 banking crisis, the ARCom received an
update on Man Group’s counterparty and liquidity risk management
processes, which had functioned well during the period. The ARCom
endorsed the firm’s conservative approach to counterparty selection,
which had resulted in no direct counterparty exposure to any of the
US regional banks and ensured that the firm was well insulated from
wider market volatility during this period. Further details on the firm’s
response to the March 2023 banking crisis can be found on page 29.
The Committee also considered liquidity and counterparty risk in the
context of the US debt ceiling crisis, monitoring management scenario
and stress testing to ensure potential market infrastructure impacts
were understood and mitigated as far as possible.
Monitor and review of risk and control environment –
key functional areas
The ARCom also considered presentations from each of the firm’s key
functional areas.
Risk
The ARCom received its annual update from the Risk function and
discussed its role in supporting Man Group’s governance processes.
A review of the impact of the senior role changes effected during the
year, following the appointment of Robyn Grew as CEO, was also
undertaken by the Committee, with a particular focus on any resulting
changes to the firm’s governance framework. Pursuant to these
changes, the role of Head of Non-Financial Risk was established
(assumed by Kate Squire, former Global Head of Compliance,
Regulatory and BORR) to consolidate all non-financial risk functions
into one department to further enhance the existing coordination
between the different functions.
At the May meeting, the ARCom received a detailed overview of
work to map the firm’s third-party providers and processes through a
service-led model to build a robust resiliency and business continuity
framework. The Committee noted the regulatory focus on this area
and the steps taken during several live incidents to identify potential
third- and fourth-party impacts on Man’s operations. The Committee
also reviewed key third-party provider dependencies, including the
measures in place to ensure strict oversight of outsourced processes.
The ARCom considered and monitored people related risks during the
year, including litigation risk and related market trends, in addition to its
annual examination of key person risk across key business units, with
an emphasis on the succession plan for those roles.
During the year, the Committee also received an update on financial
fraud risks and discussed the efforts undertaken by management
to continuously scrutinise and enhance existing controls in this area,
including the risk of collusive fraud and strength of controls over the
Group’s cash balances. The Committee also considered the impact
of the new ‘failure to prevent fraud’ offence introduced as part of the
Economic Crime and Corporate Transparency Act 2023.
Man Group plc | Annual Report 2023
Governance 93
The ARCom also reviewed proposed amendments to the Risk
Appetite and Governance Framework (the Framework), the structure
of which had been amended to enable an approach more tailored to
the intended audience of each part of the Framework. The ARCom
endorsed the revised Framework and recommended it to the Board
for approval (a summary of Man Group’s risk appetite statements is
available on the Company’s website).
Finance
The ARCom received updates at each meeting from the CFO
and Group Financial Controller on the Finance function’s operations
and controls.
any risk to the firm and ensure no material client or operational
impacts occurred. The Committee was also mindful of other industry
threats, such as the ION Group cyber event, due to the potential for
such incidents to disrupt markets or cause other indirect impacts to
the firm.
In July, the ARCom received an update on the firm’s usage of GenAI
tools and the controls in place to mitigate the risks of the technology.
The Committee endorsed the firm’s approach, which balanced the
appetite to embrace GenAI to benefit numerous functions across the
firm against ensuring the risks of the technology were mitigated,
achieved through the implementation of strict policies and monitoring.
The ARCom monitored the status of the government’s reforms in audit
and corporate governance and discussed the updated UK Corporate
Governance Code, focusing in particular on the new requirements
regarding the review and reporting of the risk management and
internal controls framework. The ARCom also kept abreast of
changing reporting standards and application guidance throughout
the year, including in relation to IFRS 13 ‘Fair Value Measurement’
following the FRC’s thematic review and IFRS Sustainability Disclosure
Standards, and recent guidance on financial instruments with the
characteristics of equity. The Committee also devoted significant time
to a review of the definition of core earnings following changes in
the business, and the approach to the consolidation of CLOs in the
financial statements.
At the December meeting, the Group Financial Controller presented
on the firm’s tax position, the key projects undertaken by the Tax team
during 2023 and areas of focus for 2024.
Compliance
During the year, the Head of Non-Financial Risk presented the 2023
Compliance Review. Particular focus was given to due diligence work
undertaken ahead of the Varagon and Asteria transactions, as well
as regulatory notifications and alignment of controls post-completion,
routine entity level regulatory examinations, and introductory meetings
between the regulator and the firm’s new CEO and Chair during the
year. Consideration was also given to resourcing levels, global
themes around regulatory risk, current priorities of key regulators and
Compliance function-led initiatives. The ARCom continued to monitor
steps taken by the management team to raise awareness of the
channels available to Man Group’s workforce to raise concerns,
including through review of amendments to the firm’s Global
Whistleblowing Policy.
In July, the ARCom received training on the FCA Consumer Duty,
its impact on the firm and the broader asset management market,
facilitated by external counsel with Man Group’s Product and
Compliance teams.
During the year, the ARCom also received a training briefing on key
cyber security themes relevant to the firm and the financial services
industry, facilitated by external subject matter experts.
Ongoing monitoring of the Group’s systems of risk
management and internal control
The ARCom is satisfied that – through regular review of reports
and dashboards, in-depth assessment of key business areas
and functions, consideration of changes to the Risk Governance
and Appetite Framework and ongoing review of progress against
the Internal Audit Plan (more detail below) – it is appropriately
monitoring the ongoing effectiveness of Man Group’s systems of risk
management and internal control. Further details can be found in the
Risk management section on pages 28 to 35.
During the year, a number of operational matters were reported to
the ARCom. These were discussed as necessary throughout the
year and papers summarising these matters were considered by the
ARCom at its December 2023 and February 2024 meetings. Whilst
Man Group sought to improve its processes in response to the
matters identified, they were not considered sufficiently material in
number or nature either to require separate disclosure in the financial
statements or to indicate that the control environment had not been
operating effectively. The ARCom also concluded that there were no
specific matters to bring to the Remuneration Committee’s attention
which may impact its decision on discretionary remuneration
payments, given management action had already been taken
where necessary.
Internal Audit
Internal Audit Plan
The Group’s Internal Audit function continues to be performed by
KPMG. The ARCom reviewed and approved the 2024 Internal Audit
Plan which included details of the planned audit reviews for 2024 and
the proposed team responsible for delivering the 2024 plan led by
Stuart Wooldridge, KPMG partner and Head of Internal Audit.
Following the publication of the SEC’s significant new rules applicable
to advisers of private funds, the Committee received an update on the
potential impact to the firm and the Compliance function’s approach
to implementation. In addition, the Money Laundering and Reporting
Officer (MLRO) presented their Annual Report at the February 2023
meeting and confirmed that Man Group had established and
maintained effective anti-money laundering and counter-terrorist
financing systems and controls.
The ARCom discussed Internal Audit reports presented by the
Head of Internal Audit at each meeting, reviewed progress against
the 2022 and 2023 Internal Audit Plans and monitored the closure of
management actions arising from Internal Audit’s recommendations
to address control enhancements. Whilst no significant weaknesses
were identified in any of the Internal Audit reports, a number of
improvements to certain processes and controls were implemented
in response to the recommendations.
Cyber security
Cyber security remained an area of focus for the ARCom throughout
the year and it continued to receive regular reports on key themes
and trends. The ARCom monitored the implementation of control
enhancements to ensure the firm’s controls continued to be
robust and keep pace with the fast-changing threat landscape. The
Committee was fully briefed on the steps taken in response to the high
profile MOVEit breach, management having acted quickly to ascertain
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 94
Audit and Risk Committee report continued
Effectiveness of Internal Audit function
During the year, the Committee reviewed the effectiveness of the
Internal Audit function and the outsourced Internal Audit model,
seeking feedback from management and Committee members.
The process concluded that, overall, the Internal Audit function
continued to perform to a satisfactory level and provided an
independent perspective on Man Group’s control environment.
An external quality assessment (EQA) of the Internal Audit function will
build on this process in 2024, considering areas such as resourcing,
delivery, reporting and adding value, and the independence of the
function, incorporating feedback from ARCom members and key
stakeholders across the firm. The EQA was deferred from 2023 to
early 2024 so that the new Global Internal Audit Standards could be
considered as part of the process.
External audit
Audit Committees and the External Audit: Minimum
Standard (the Standard)
The Company is subject to the Standard published by the FRC
in May 2023 which currently applies on a voluntary basis.
The Company has chosen to apply the Standard, and confirms
compliance with its requirements. Reporting on the activities
undertaken by the Committee to meet the requirements of the
Standard is contained throughout the ARCom report. The
Company’s accounting policies are included within the financial
statements on pages 138 to 173.
2023 External Audit Plan
At the October meeting, the 2023 External Audit Plan was presented
by Bevan Whitehead, who has been lead engagement partner since
2021. The plan, which was discussed and approved by the ARCom,
set out the proposed materiality threshold, the scope of the audit and
the significant audit risks that had been identified.
Auditor independence and the provision of non-audit services
In order to safeguard the independence and objectivity of the
external auditor, the ARCom is responsible for the development,
implementation and monitoring of Man Group’s policies on the
provision of non-audit services and oversight of the hiring of personnel
from the external auditor should this occur. The ARCom reviewed
and approved the Company’s non-audit services policy at the
October 2023 meeting.
Man Group plc | Annual Report 2023
Summary of non-audit services policy
In accordance with the non-audit services policy, any potential
services to be provided by the external auditor, which are not
excluded under the non-audit services policy and are prescribed
by the FRC’s Revised Ethical Standard 2019 but which have an
expected value of $75,000 or more, must be approved by the
ARCom in advance. The non-audit services fees in aggregate
must not exceed 70% of the statutory audit fee for the previous
three years, which is equivalent to $1.8 million for 2023. Further
details can be found on the Company’s website.
The table below shows the remuneration paid to Deloitte in 2022
and 2023.
Fees payable to the external auditor for
the audit of the Company and the
consolidated financial statements
Other services:
The audit of the Company’s subsidiaries
pursuant to legislation
Audit-related assurance services
All other services
Total auditor’s remuneration
2023
$’000
2022
$’000
990
786
2,684
451
337
4,462
2,295
464
56
3,601
The increase in the remuneration paid to Deloitte in 2023 is due
to cumulative market realignment and inflation, as well as costs
relating to the integration of Varagon and Asteria, and certain
controls assurance services transitioned to Deloitte for the first
time in 2023 due to its familiarity with the Group.
The independence of the external auditor is safeguarded
by control measures including:
• policies limiting the nature of non-audit services (see above)
and hiring of personnel from the external auditor, both of which
are subject to annual review by the ARCom;
• an independent reporting line from the external auditor
to the ARCom and provision of private sessions without
management presence;
• rotation of the lead engagement partner every five years;
• provision of a confidential helpline which employees can use
to report concerns; and
• provision of an annual letter from the external auditor
confirming its independence.
Following a formal assessment of the external auditor’s
independence and objectivity in February 2024, the ARCom
concluded that Deloitte continued to be independent
and objective.
Governance 95
Effectiveness of external audit process
How the ARCom has assessed its effectiveness
At the May 2023 meeting, the ARCom considered feedback from
ARCom members and various members of the management team in
order to facilitate the ARCom’s formal assessment of the effectiveness
of the external audit process. Respondents were asked for their
views on several components of the external audit process including
the quality of the audit partner and team, planning and execution
of the audit, quality of audit reporting and the external auditor’s
independence and objectivity.
Outlined in the table below are the key areas that were identified in
the ARCom’s 2022 evaluation as requiring further consideration and
development during 2023, together with the progress that has been
achieved in 2023.
2023 progress on 2022 actions
2022 evaluation
2023 progress
The responses indicated that, overall, Deloitte was performing in line
with expectations, with the audit team demonstrating appropriate
challenge and understanding of Man Group’s business. Deloitte’s
team at partner and director level were commended for their technical
skills and engagement with management.
Discuss and agree
appropriate balance
between audit versus
risk coverage at
meetings
Monitoring of
attendance of non-
ARCom members at
ARCom meetings
Meeting agendas continued to be split into risk
and audit sections to allow for the necessary
focus on each area to be clearly drawn out.
The balance was monitored throughout 2023
and feedback on the approach was sought
as part of the 2023 evaluation. The merits
of establishing separate audit and risk
committees will continue to be reviewed
in 2024.
Where appropriate, certain year-end audit
matters were front-loaded to December 2023
to spread the audit workload across the year
more evenly and enable earlier engagement
and focus from ARCom.
Only ARCom members and key contributors
attended the audit portion of ARCom
meetings during 2023. While non-ARCom
Board members are welcome to attend the
risk portion of the meeting, feedback noted
the established escalation and reporting to
the Board by the ARCom Chair served as an
effective means of escalating relevant matters
for Board consideration to ensure that Board
members could discharge their responsibility
for oversight of risk matters, complementing
the scrutiny and challenge driven by ARCom
members during meetings.
The management team was also praised for
broadening the range of presenters at the
ARCom to enable the Committee to build
relationships with the wider risk teams.
Progress against the 2022 evaluation actions was assessed in July
2023, with feedback sought from ARCom members at that stage.
In December 2023 the ARCom conducted its annual effectiveness
evaluation, which was facilitated internally. Responses were obtained
from ARCom members and certain regular attendees through
meetings conducted with the ARCom Chair.
In response to feedback, amendments were made to the February
agenda to further enhance the focus on audit matters, while an
update on liquidity management and policies was also added to
the forward agenda for 2024.
Additional areas identified for focus in 2024 included the continued
consideration of an appropriate balance between audit and risk
matters at meetings, as well as the merits of separate audit and
risk committees.
Responses indicated that the ARCom continued to operate as a
thoughtful and collaborative forum while also prompting productive
debate and challenge.
Lucinda Bell
Chair, Audit and Risk Committee
The output of the effectiveness review also praised the efficiency of
the audit as a result of thorough planning at the outset.
A number of areas, including the development of audit quality
indicators and continued coordination with Internal Audit, were
identified as requiring further consideration and Deloitte’s plans
to address these issues were set out alongside their 2023 Audit
Plan. After discussion, the ARCom concluded that the external
audit process in respect of the 2022 financial statements had
been effective.
Deloitte provided constructive challenge to management’s
assumptions and judgement in relation to the consolidation of CLOs
in the financial statements and acquisition accounting in relation to
Varagon. In all areas, Deloitte concluded that the assumptions and
judgements applied by management were appropriate.
Reappointment of Deloitte as external auditor
Deloitte was appointed as the Group’s external auditor in 2014,
following a tender process led by the ARCom in 2013. In accordance
with the Code and the Competition and Markets Authority’s Order
2014, the Company was required to put its external audit out to tender
again in 2023 at the latest.
Following initial planning in 2021, a decision was taken to proceed
with the external audit tender in 2022 for the audit in respect of the
financial year ending 31 December 2024. Following a thorough and
extensive tender process, details of which were included in last year’s
Annual Report, the ARCom recommended the reappointment of
Deloitte as Man Group’s external auditor to the Board. The Board
subsequently recommended the reappointment of Deloitte to
shareholders, who then approved the reappointment at the 2023
Annual General Meeting.
Following the ARCom’s review of the effectiveness of the external
audit process earlier in the year and its assessment of the external
auditor’s independence and objectivity, it has recommended
the reappointment of Deloitte as Man Group’s external auditor
to the Board. The Board has subsequently recommended the
reappointment of Deloitte for approval by shareholders at the 2024
Annual General Meeting.
The ARCom will continue to assess the external audit process
annually to ensure that it remains effective and the audit fee represents
good value to shareholders, while mandatory rotation of the external
auditor is required by the 2034 financial year. The ARCom confirms
that the Company has complied with the provisions of the Statutory
Audit Services Order 2014 for the financial year under review.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 96
Nomination and Governance Committee report
Anne Wade
Chair, Nomination
and Governance Committee
The Committee was delighted to recommend
to the Board for approval the appointment of
Robyn Grew as our new CEO.
Summary of the Nomination and Governance
Committee’s activities during 2023 and early 2024
• Reviewed the size, composition, diversity and skill set of the Board and
its Committees.
• Undertook a review of candidates to succeed John Cryan as Chair
and recommended to the Board for approval the appointment of
Anne Wade who took over the role on 1 October 2023.
• Implemented its succession plans and recommended to the Board for
approval the appointment of Robyn Grew as the Company’s next CEO.
• Recommended to the Board for approval the appointment of:
– Laurie Fitch as a non-executive director, Chair of the
Remuneration Committee and member of the Audit and Risk
Committee and Nomination and Governance Committee;
– Ceci Kurzman as a member of the Remuneration Committee
and Nomination and Governance Committee; and
– Alberto Musalem as a member of the Nomination
and Governance Committee.
• Recommended to the Board for approval changes to the Board
Diversity, Equity and Inclusion Policy.
• Recommended to the Board for approval that the Committee’s remit
be extended to include governance oversight and consequent name
change to the Nomination and Governance Committee.
Membership:
Anne Wade (Chair)
Richard Berliand
Lucinda Bell
Ceci Kurzman
Laurie Fitch
Alberto Musalem
Dear Stakeholder
2023 proved to be another extremely busy year for the Committee. As
reported last year, the Committee spent significant time in early 2023
considering potential successors for John Cryan as Chair. Following a
review of potential internal candidates and an external benchmarking
process, the Committee recommended, and the Board approved,
my appointment as Chair, with effect from 1 October 2023. I did
not participate in any of the discussions or decisions around Chair
succession. I would like to reiterate my thanks to John for his time
and support during our handover period and wish him all the best for
the future.
Given the importance of succession planning to the long-term
success of the Company, the Committee continued to dedicate
meaningful time to considering this during the course of 2023. This
included identifying potential successors for the CEO role and, with
the assistance of an external executive search firm, undertaking a
thorough preparatory external benchmarking exercise. Following
Luke Ellis’ decision to retire as CEO, the Committee was pleased to be
able to implement its succession plans and recommend to the Board
for approval the appointment of Robyn Grew as Man Group’s next
CEO. Robyn took over from Luke on 1 September 2023 following a
three-month handover period.
During 2023, after an extensive search process, we also welcomed
Laurie Fitch to the Board who succeeded me as Remuneration
Committee Chair on 1 October 2023, at which time she also joined
this Committee. In addition to Remuneration Committee experience,
Laurie brings to the Board extensive experience as an equity
investor and banker, as well as strong strategic insight and
international perspective.
In response to Board feedback and the independent governance
review recommendation, we also took the opportunity to reassess
Committee membership more broadly and recommended to the
Board for approval the appointment of Ceci Kurzman and Alberto
Musalem as additional members of the Committee with effect from
1 October 2023. We also agreed to extend the remit of the Committee
to include governance-related items and have renamed it the
Nomination and Governance Committee.
Having considered the composition of the Board and its committees,
the Committee identified that the Board would benefit from additional
markets and financial services accounting experience. Non-executive
search processes focusing on these areas were initiated in 2023 and
will be the key area of focus for the Committee in 2024.
Where appropriate, Robyn Grew is invited to attend
Committee meetings.
Anne Wade
Chair
Proportion of the committee time spent on key responsibilities
1
4
2
1. Board and Committee
composition
2. Board search and
appointment
3. Succession planning
4. Governance and other
12%
39%
37%
12%
3
Man Group plc | Annual Report 2023
Governance 97
Role of the Committee
The Committee’s full terms of reference were updated during the
year to reflect the Committee’s extended membership and additional
governance responsibilities. The terms of reference were reviewed
by the Committee and submitted to the Board for approval and are
available on the Company’s website. A summary of responsibilities
is as follows:
• keep the Board’s composition under regular review in terms of its
size, structure, skills, experience and diversity in response to
changing business needs and opportunities;
• identify the particular skills, knowledge and experience required
for specific Board appointments and conduct the search and
selection process;
• recommend the appointment of new candidates to the Board
and the renewal, where applicable, of existing non-executive
director appointments;
• review plans for executive director and senior management
development and succession; and
• keep the Company’s corporate governance arrangements under
review and make appropriate recommendations to the Board to
ensure that the Company’s arrangements are consistent with UK
corporate governance standards and best practice.
Committee membership and remit
As mentioned above, in response to Board feedback and the
recommendation set out in the independent governance review
undertaken during the year, the Committee took the opportunity to
review its membership and agreed that, given the importance of the
role of the Committee, the rest of the existing non-executive directors
should be appointed to the Committee. This new structure became
effective on 1 October 2023.
In addition, the Committee recommended and the Board approved
that it would be appropriate to extend its remit to cover governance-
related items, consistent with many of our peers. It will now be the
responsibility of the Committee, with the support of the Company
Secretary, to review the Company’s corporate governance
arrangements and recommend any changes to the Board as well as
monitor developing trends, initiatives or proposals in relation to Board
governance issues.
Board and Committee changes
As previously mentioned, there have been a number of changes
to the Board and Committees during 2023. Jackie Hunt and Kate
Barker stepped down from the Board and from the Audit and Risk
Committee and Remuneration Committee with effect from 28 March
2023 and 1 April 2023, respectively. We would like to thank Kate for
her significant contribution to the Board over the past six years, and
Jackie for her insights during her tenure, and we wish them all the best
in their future endeavours.
In May, Luke informed the Board of his intention to retire as CEO.
The Board approved the appointment of Robyn Grew as the next
CEO who took over from Luke on 1 September 2023. Further details
on the CEO succession process are set out opposite. At the end of
September, John Cryan retired from the Board after almost nine years,
following which I took over as Chair on 1 October 2023.
Upon my appointment as Chair, it was appropriate that I step down
as Chair of the Remuneration Committee. As a result, a non-executive
search process was initiated, focusing on individuals with recent and
relevant remuneration committee experience. Hedley May (who have
no other connection with the Company or any individual director), with
input from certain Board members, produced a longlist of candidates
with the relevant credentials for the Committee’s consideration. All
Board members met with a shortlist of candidates and were pleased
to recommend the appointment of Laurie Fitch as a non-executive
director and as a member of the Audit and Risk Committee and
Remuneration Committee to the Board for approval. The Board
approved Laurie’s appointment which took effect on 25 August 2023.
On 1 October 2023, Laurie was subsequently appointed as
Chair of the Remuneration Committee and as a member of the
Nomination and Governance Committee. On that date, Ceci
Kurzman was also appointed as a member of the Remuneration
Committee and Nomination and Governance Committee and
Alberto Musalem was appointed as a member of the Nomination
and Governance Committee.
In January 2024, Alberto informed the Board that he had been
appointed as the next President and Chief Executive Officer of the
Federal Reserve Bank of St. Louis with effect from 2 April 2024 and,
as a result, he would be required to step down from the Man Group
Board prior to taking up his new role. We will continue to benefit from
Alberto’s expertise and insights until the end of February and I would
like to thank him for his contributions whilst on the Board.
CEO succession timeline
Q1 2023
• In line with its responsibilities and best practice, formal
succession planning process for senior management,
including role of CEO, undertaken by Committee.
• Consideration given to potential internal candidates for
the CEO role and external benchmarking exercise
undertaken with the support of Hedley May, an external
search firm who has no other connection with the firm or
any individual director.
Q2 2023
• Succession plans finalised and successor for CEO
role identified.
• Luke Ellis notified the Board of his intention to retire
as CEO.
• Board invoked succession plans and approved
appointment of Robyn Grew to succeed Luke Ellis.
Q3 2023
• Handover period between Luke Ellis and Robyn Grew.
• Robyn Grew announces plans for new Executive
Committee (see pages 74 and 75 for further information).
• Robyn Grew takes over as CEO and is appointed to
the Board.
• New Executive Committee formally established.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 98
Nomination and Governance Committee report continued
Committee evaluation
Progress on the priority areas identified by the Committee in last year’s evaluation is set out below, together with the areas for focus highlighted
in the 2023 evaluation.
Progress on priority areas identified in 2022 evaluation
Priority area
Agreed action
Progress during 2023
Board
composition
• Continue to keep Board composition under review, particularly
• Laurie Fitch appointed to the Board and as Chair of the
in light of the non-executive directors’ remaining tenures and the
resulting changes to the Board anticipated over the next two to
three years.
Remuneration Committee.
• Searches initiated in 2023 with a focus on candidates with deep
markets experience and candidates with strong financial and
accounting experience.
Succession
planning
• Enhance formality around executive succession planning process. • Regular discussions around executive succession planning were
supplemented by a thorough preparatory external benchmarking
exercise for the CEO role, supported by an external executive
search firm. The Committee recommended and the Board
approved the appointment of Robyn Grew as the next CEO
following Luke Ellis’s decision to retire.
The Committee also discussed the following areas which were identified in the 2023 Board evaluation as requiring further Committee
consideration during 2024:
• progress non-executive searches for individuals with markets and accounting experience;
• explore the potential appointment of an adviser to the Board to provide additional insights and knowledge around technology and cyber
security; and
• continue to keep Board and executive succession plans under review.
Anne Wade
Chair
Board Diversity, Equity and Inclusion Policy
The Board Diversity, Equity and Inclusion Policy sets out the Board’s
understanding of the value and impact of diversity in its broadest
sense and the measures, processes and inputs through which it
seeks to increase diversity on the Board and its Committees, and
influence and monitor its impact within the Company as a whole.
The policy, which is set out on page 99, is fully aligned with Man
Group’s Global Inclusion Statement and Diversity, Equity and Inclusion
report, available on our website. Further details of our diversity, equity
and inclusion activities throughout the firm are given in the People
and culture section on pages 36 to 43. The progress regarding the
number of women in Man Group’s senior management roles (defined
as those who are, or report directly to, members of our Executive
Committee) is set out in the non-financial KPIs section on page 21.
Overview
The Board is committed to promoting diversity, equity and inclusion in
their broadest sense, both in terms of the Board’s own composition
and within Man Group’s senior management and employee base as a
whole. The Board sees diversity as the combination and interaction of
people with different knowledge, skills, experience, backgrounds and
outlooks. It believes that this creates greater value and leads to better
decision-making and performance at all levels of the organisation.
The Board is responsive to diversity, equity and inclusion
challenges within the financial services industry, acknowledging the
underrepresentation of some groups within the industry, and endorses
Man Group plc | Annual Report 2023
the steps initiated and implemented by the Executive Management
team to help navigate these challenges. In addition to the internal
diversity, equity and inclusion initiatives within Man Group, the Chair
and CEO are members of the 30% Club, Man Group is represented
on external diversity and inclusion focused committees and working
groups with other firms across the industry to maximise impact, and
is committed to transparency and sharing progress publicly as a
signatory to the Women in Finance Charter and Race at Work Charter.
The Board supports the adoption and disclosure of targets for building
gender and ethnic diversity into FTSE company boards and senior
management, including the recommendations set out in the FTSE
Women Leaders Review on gender diversity and the Parker Review
on ethnic diversity and the Board diversity targets set out in the Listing
Rules. The Board is committed to complying with these by ensuring
that there is at least 40% female representation and at least one
director from an ethnic minority background on the Board, as well as
ensuring that at least one of the senior Board positions is held by a
woman. The Board acknowledges that during periods of transition,
this composition may not, temporarily, be maintained.
The Board also recognises that these targets should be viewed as a
base level to work from and that diversity of thought comes in many
forms. As a consequence, the Board challenges itself to continue
its progress and maintain a target of at least 50% of its members
representing minorities and diversity in all its forms.
Governance 99
Set out below are three main areas on which we are focusing in pursuing our policy objectives.
Formal succession planning discussions at Board and Nomination
and Governance Committee meetings were supplemented this year
through more informal discussions during Board dinners around
development and succession planning for Board and senior
management positions.
The Board was also able to increase its exposure to executives
below Board level and to assess the strength, breadth and diversity
of management resource available to the business through:
• updates at Board and Committee meetings from Executive
Committee members and other members of the management
team on the areas of the business for which they are responsible;
• attending presentations delivered by various individuals within the
business, including several portfolio managers; and
• participation by certain non-executive directors in an Executive
Committee mentoring programme.
Review and reporting
The Board is committed to the development of diversity, equity and
inclusion on the Board and among Man Group’s employees. It will
seek feedback on Board balance, including diversity in all its forms
alongside the balance of skills and experience, in its annual Board
evaluation and will keep the review and challenge of Man Group’s
people development, inclusion and diversity programmes firmly
on the Board agenda. An account of the Board’s activities and
progress against its objectives in these areas will be given in the
Annual Report each year.
Implementation in 2023
Feedback from the 2023 Board and Committee evaluations
highlighted the strong gender diversity on the Board as well as the
diversity of perspective and background whilst identifying the need
to bring additional markets and accounting experience to the Board
in 2024. During 2023, the Board was pleased to appoint Laurie
Fitch as a non-executive director who brings extensive investment
management experience, economic and public policy expertise and
broad knowledge of capital markets and regulation. The Nomination
and Governance Committee will continue to focus on ensuring
the composition of the Board remains appropriate along with the
promotion of diversity through recruitment, talent management
and succession.
The Company was an early adopter of the new disclosures required
under the Listing Rules around gender and ethnic diversity at Board
and executive management level. The metrics regarding diversity
targets (gender and ethnicity) of Board and Executive Committee
members and the Company Secretary, in the form prescribed by
the FCA, are included on page 73.
Board appointments
When seeking to make a new appointment, the Board will focus
first on identifying an individual with the capability, expertise and
experience that are required to discharge the specific role, and
will select the best candidate on that basis. Within this remit, it
recognises the added value to be derived from all forms of diversity,
including diversity of age, gender, gender identity, ethnicity, sexual
orientation, disability, educational, professional and socio-economic
background, and cognitive and personal strengths. To support this
objective, we adopt a formal approach to Board searches, which
includes insisting on strong representation of underrepresented
groups on search firms’ long lists and short lists and remaining
conscious of any potential for bias in the interview and selection
process. We will also consider and explore alternative routes to
the supply of appropriate candidates.
Implementation in 2023
The Committee considered diversity in the context of the new
non-executive search and as part of the Chair and CEO succession
processes and requested the external search firms supporting on
these searches to take account of this when identifying potential
candidates for the relevant roles. As set out on page 73 we
are pleased that we have exceeded the targets contained in the
Women Leaders’ Review and Parker Review and that two of the
four senior Board roles (CEO, CFO, Chair and SID) are held by
women, exceeding the targets set out in the Listing Rules.
Oversight of recruitment, development and inclusion
The Board continues to encourage and oversee the output from
a wide range of recruitment and people development policies and
initiatives led by the Executive Management team, which aim to
grow the diversity of Man Group’s talent pool, provide development
opportunities for all and embed an equitable and inclusive culture.
While we cannot lead such initiatives directly, our role as a Board
is to monitor and challenge the impact they are having on the firm.
As part of this oversight, we review and discuss the success of the
diversity, equity and inclusion network activities across Man Group.
We also keep updated on Man Group’s relationships with partners
who can help source talent from more diverse backgrounds and
under-represented groups and Man Group’s sponsorship of events
that encourage more diverse talent into financial careers.
In addition, a key role of the Nomination and Governance
Committee is to monitor and discuss with the CEO the career
development and succession plans for senior management across
the firm, including the progress of any underrepresented groups.
This enables us to promote the development of a strong and
diverse pipeline of talent for future executive leadership and Board
positions. The responsibilities of the Nomination and Governance
Committee in relation to the implementation of its diversity, equity
and inclusion objectives are outlined in its terms of reference.
Implementation in 2023
In addition to the regular updates on specific people hires and
promotions, the Board again undertook a specific review of Man
Group’s culture. This included consideration of the diversity, equity
and inclusion network activities to promote and support a diverse
culture within the organisation and management’s continued
efforts to improve diversity within the organisation. The Board also
discussed and approved gender and ethnicity targets for senior
management. Further details are set out on pages 40 to 41.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 100
Directors’ Remuneration report
1. Chair’s annual statement
Laurie Fitch
Chair of the
Remuneration Committee
Summary of the Remuneration Committee’s activities in
2023 and early 2024
• Considered the fees for the Chair, the non-executive directors and
the Senior Independent Director.
• Determined the total annual compensation for the executive directors,
Executive Committee members, the Company Secretary and
Remuneration Code staff.
• Considered compensation of the wider workforce, including by
reference to both gender and ethnicity metrics, and reviewed the ratio
of the CEO’s pay to other employees.
• Approved remuneration arrangements for the new CEO.
• Agreed arrangements for retiring CEO.
• Reviewed and approved the Directors’ Remuneration report.
Current Membership1:
Laurie Fitch (Chair)2
Ceci Kurzman3
Anne Wade2
Richard Berliand
Alberto Musalem
Where appropriate, Robyn Grew (and previously Luke Ellis) is
invited to attend Committee meetings.
1 John Cryan retired from the Board and stepped down from the Committee on
30 September 2023. Jackie Hunt stepped down from the Board and the Committee on
27 March 2023. Kate Barker retired from the Board and stepped down from the
Committee on 1 April 2023
2 Anne Wade stepped down as Chair of the Committee on 30 September 2023. Laurie
Fitch was appointed to the Committee on 25 August 2023 and was appointed Chair
of the Committee on 1 October 2023 and attended all meetings after 25 August 2023
3 Ceci Kurzman was appointed as a member of the Committee on 1 October 2023 and
attended all meetings after that date
Contents
Chair’s annual statement
Remuneration at a glance
Directors’ Remuneration Policy summary table
Remuneration outcomes for 2023
Executive director pay in the context of
Man Group’s shareholders
Executive director pay in the context of
Man Group’s employees
100-103
104-108
104
105-106
107
108
Remuneration outcomes in 2023
109-118
Single total figure of remuneration for executive directors
109
Annual bonus in respect of 2023 performance
109-111
Vesting outcome in respect of the 2021 LTIP
Relative importance of spend on pay
Review of past performance
Percentage change in directors’ remuneration
CEO pay ratio
Retirement benefits
Single total figure of remuneration for non-executive directors
Payments for loss of office
Payments to past directors
Directors’ interests
Directors’ interests in shares and options under Man Group
long-term incentive plans
Shareholder voting and engagement
Implementation of Directors’
Remuneration Policy for 2024
Base salary
Annual bonus for 2024
Long-Term Incentive Plan for 2024
112
112
113
114
115
115
115
116
116
116
117-118
118
119-120
119
119
119
119
120
121-123
121
122
122
123
123
How the Committee spent its time in 2023
Non-executive directors’ Remuneration Policy for 2024
Illustrative pay for performance scenarios
6
1
5
4
3
2
1. Executive Directors’
Remuneration
53%
2. Employee Remuneration 21%
3. Senior Management
Remuneration
4. Shareholder Engagement,
DRR and Remuneration
Policy
5. Governance and Other
6. Financial Regulation
7%
7%
7%
5%
Remuneration Committee
Membership and attendance
Independent advisers
Committee activities during 2023 and the early part of 2024
2023 Committee evaluation
Benchmarking and peer groups
Man Group plc | Annual Report 2023
Governance 101
Dear Stakeholder
On behalf of the Board, I am pleased to present the Directors’
Remuneration report (the DRR) for the year to 31 December 2023.
For ease of reference, this report contains the following sections:
• a detailed index to help you find the sections you need (page 100);
• this annual statement (pages 101 to 103);
• the ‘remuneration at a glance’ section, summarising how the
Directors’ Remuneration Policy has been implemented in 2023
(pages 104 to 108); and
• the annual report on remuneration (pages 109 to 123).
1.1 Introduction
I am presenting my first DRR as Chair of the Committee, having been
appointed on 1 October 2023.
On behalf of the Committee, I would like to thank those shareholders
who continued to engage with us during 2023. We were delighted
that, at the 2023 Annual General Meeting (AGM), more than 90% of
our shareholder base voted in favour of the DRR.
2023 has been a year of leadership change at Man Group. In May
2023, Luke Ellis, who had been CEO since September 2016 informed
the Board of his decision to retire. Robyn Grew, formerly President of
Man Group was appointed to the role of CEO and joined the Board
as an Executive Director on 1 September 2023.
The remuneration aspects of Luke’s retirement and Robyn’s
appointment are in line with the Directors’ Remuneration Policy,
as set out in more detail later in the report.
During the remainder of the year, the Committee’s particular areas of
focus included remuneration outcomes in the context of Man Group’s
performance and remuneration below Board level.
Against a challenging year for active investment managers, Man
Group plc has delivered resilient performance this year, and we believe
the executive pay outcomes, as detailed below and in the sections
that follow, appropriately reflect that level of performance.
1.2 The Remuneration Policy
Our existing Directors’ Remuneration Policy was approved by
shareholders at the 2022 AGM. The Committee has continued to
keep the policy under review and is happy that it has operated as
intended during 2023.
The performance metrics selected for use in the short- and long-term
incentive arrangements in the Directors’ Remuneration Policy reflect
Man Group’s strategic priorities. The financial metrics are aligned
with Man Group’s financial key performance indicators (KPIs) which
illustrate and measure the relationship between the investment
experience of Man Group’s clients, our financial performance
and the creation of shareholder value over time. The non-financial
objectives in the bonus, including those related to ESG, are aligned
with our strategic focus and non-financial KPIs to ensure that
executives remain focused on the delivery of annual performance
whilst ensuring the building blocks for future growth are put in place.
This alignment ensures that the link between strategy, the KPIs by
which we measure performance and reward is clear, as shown in the
table below.
During 2024, the Committee will be undertaking a review of the
Directors’ Remuneration Policy to ensure that it continues to support
appropriately the delivery of our strategic priorities and rewards
executives for long-term, sustained performance. As part of that
process, we intend to seek the views of our shareholders, and other
stakeholders, by undertaking a far-reaching consultation, as has been
our approach during previous policy reviews. The policy will be
submitted to shareholders for approval at the 2025 AGM.
1.3 Shareholder engagement in 2023
We remain committed to ongoing contact and engagement with
our shareholders to ensure a transparent and open dialogue around
Man Group’s executive remuneration arrangements. At the time
the DRR was published in March 2023, we contacted shareholders,
representing around 56% of our shareholder base, together with the
main shareholder representative bodies and proxy agencies, offering
a meeting or call to discuss any aspects of the published policy or
the DRR. We subsequently met with all shareholders who requested
a meeting.
1.4 The link between the pay of executive directors
and the workforce
At the start of 2023, against a continuing backdrop of high inflation
and the resulting cost of living pressures, management conducted
a tiered salary review whereby those on lower salaries, representing
approximately 20% of the global employee population, received
double digit salary increases, subject to satisfactory performance.
Overall salaries in 2023 increased by an average of 5.6%.
Financial
KPIs
– Relative
investment
performance
– Relative net
flows
– Core
management
fee EPS
growth
– Core EPS
Innovative investment
strategies
Strong client
relationships
Efficient and effective
operations
Returns to
shareholders
Strategic priorities
Relative net flows
Bonus metrics
Core management fee EPS
Core EPS
ESG-related objectives
Strategic and personal objectives
LTIP metrics
Relative investment performance
Cumulative relative net flows
Relative TSR
3-year core management fee EPS
3-year core EPS
ESG scorecard
Non-financial
KPIs
– Carbon
footprint
– Women
in senior
management
roles
– ESG
integrated
AUM
– Employee
engagement
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 102
Directors’ Remuneration report continued
1. Chair’s annual statement continued
For 2024, once again, higher salary increases will be targeted at those
employees on lower salaries. Overall salaries are budgeted to increase
by an average of 4.4%.
In addition, as part of its consideration of the overall appropriateness
of the executive directors’ remuneration in 2023, the Committee
undertook the following actions:
• approved the total bonus pool to be allocated to staff;
• carried out a detailed review of bonus proposals and evaluations
for the Executive Committee, Company Secretary and individuals
covered by the Remuneration Codes;
• reviewed the ratio of CEO pay to the UK employee population and
discussed the reasons for the movement over previous years,
as set out in the commentary under table R8 on page 115; and
• reviewed annual performance ratings and compensation outcomes
by gender and ethnicity to ensure decision-making was objective
and without bias. This analysis, which has now become an integral
part of committee business, showed that compensation in the
wider workforce was fair and reasonable, when taking account of
the employee’s role and location.
The Committee again engaged with employees by providing a simple
document explaining how the remuneration of the executive directors
is determined and how that links with the approach to the
remuneration of the wider workforce, and employees were invited to
submit any questions via a dedicated email address.
Board changes during 2023
On 11 May 2023, we announced that Luke Ellis was to retire from his
role as CEO with effect from 31 August 2023 and that he would be
succeeded by Robyn Grew, formerly President of Man Group.
Full details of Luke and Robyn’s remuneration arrangements are
disclosed later in the DRR (pages 104 and 116). In determining their
arrangements, the Committee followed the approach set out in the
Directors’ Remuneration Policy.
As part of Robyn’s move to the UK from the US, the Company
has provided a relocation package, which included temporary
accommodation and flights. The Committee also agreed to tax
equalise Robyn back to the US until the end of 2024 at the latest,
however no payment was required for 2023. Further details can be
found on page 109.
On 28 February 2023, we announced that John Cryan who had
served as Chair of the Board since January 2020, would retire towards
the end of 2023 and Anne Wade would succeed him as Chair of the
Board. Anne was appointed as Chair of the Board on 1 October 2023
at which time she stepped down as Chair of the Remuneration
Committee. Anne’s fees on appointment were set at £385,000,
in line with that of her predecessor.
1.5 Review of performance in 2023
2023 was challenging for active investment managers and tested
allocators’ appetite for risk as interest rates dominated the story of
financial markets. Nevertheless Man Group’s performance was resilient.
We delivered +1.6% of relative investment performance during
the year. Our net inflows for the year were ahead of the industry,
demonstrating the relevance of our offering and our client
relationships. Following the acquisition of Varagon, our assets under
management ended 17% higher compared with the beginning of the
year, a new record for the firm.
Core management fee EPS in the year was unchanged as growth in
net management fees was offset by a planned increase in fixed costs
to support growth.
Our ability to generate value for our shareholders continues to be
a core focus. Man Group delivered Total Shareholder Return (TSR)
performance in 2023 of 15% outperforming the FTSE 250 return of
8% and broadly in line with the return of our more direct peers in the
FTSE 350 Financial Services index of 14%.
A summary of the key decisions is shown below:
1.6 Remuneration outcomes for 2023
Luke Ellis
Luke’s 12-month notice period started immediately upon notification of
his planned retirement. His bonus for the 2023 financial year has been
pro-rated for the time served to 31 August 2023, the date on which
he stepped down from the Board. The 2023 bonus was deferred
in the usual way and will be released in line with the normal vesting
schedule, along with those awards already held under the Deferred
Share Plan from bonus deferral in previous years. He will not be
eligible to receive an LTIP award in March 2024. He will be subject to a
two-year shareholding requirement of 300% of salary from the date he
stepped down from the Board.
Robyn Grew
Robyn was appointed to the Board and became CEO on
1 September 2023. The structure and quantum of the CEO
remuneration package is consistent with our Directors’ Remuneration
Policy and is aligned with that of her predecessor. It comprises:
• base salary of $1,100,000;
• annual bonus opportunity of up to 300% of salary, subject to
performance and deferral (pro-rated in 2023 to reflect start date);
• long-term incentive plan award of 300% of salary. Robyn’s first LTIP
award was granted on 4 September 2023; and
• pension of 14% of salary and other benefits in line with the Directors’
Remuneration Policy.
In the ‘Remuneration at a glance’ section of this report on page 105 we
have again detailed how we set stretching targets for the 2023 bonus.
Targets for each performance measure are set by the Committee
with consideration of a number of reference points including internal
budgets and forecasts, consensus estimates available at the time and
the long-run historical performance of Man Group and our peers.
The range of targets set for relative net flows requires at least industry
outperformance and at the maximum level would deliver strong
market share gains. In 2023, we saw net inflows during a period when
many of our peers experienced outflows and delivered relative net
flows of 4.9%, which falls between target and maximum, a strong
outcome in a difficult flow environment.
The target and maximum for core management fee EPS were set
above the 2022 targets, and against these higher targets 18.4 cents
per share was delivered, resulting in a close to maximum outcome for
this metric.
The one-year volatility of performance fee income means that it
is appropriate to set a wide range for core EPS bonus targets.
Nevertheless, the threshold, target and maximum were set between
21-28% higher than in 2022 at 25.5 cents, 32.0 cents and 38.5 cents
respectively. Whilst the maximum target was set below the core EPS
delivered in 2022, this is in the context of record performance in the
last two financial years. As a result of lower performance fees,
following an exceptionally strong 2022, core EPS of 22.4 cents
was delivered, i.e. below threshold.
Man Group plc | Annual Report 2023
Governance 103
This resulted in an overall outcome on the financial component of
the bonus of 42.7% out of a maximum of 70%.
In the second year that ESG-related objectives have been included
explicitly in the bonus, the Committee noted that good progress
had been made (as detailed on page 110). These objectives, which
are aligned to the objectives set out under our sustainable growth
strategy, are common to both executive director roles and a score
of 10%, out of a maximum of 15% was awarded.
The personal and strategic objectives which account for a maximum
of 15% of the bonus are intended to incentivise performance on the
range of actions and activities in the business, the results of which we
expect to see delivered over time in the quantitative outcomes in the
LTIP. The Committee determined that Luke Ellis’ performance justified
an outcome of 11% as an award. Since being appointed as CEO on
1 September 2023, the Committee determined that Robyn Grew had
made an excellent start and an outcome of 12% was warranted.
The Committee determined that Antoine Forterre’s performance also
justified an outcome of 12% as an award.
The 2021 LTIP award was made in March 2021 for the three-year
period from 1 January 2021 to 31 December 2023 and vests in
March 2024, with a subsequent two-year post vesting holding period.
The level of vesting at threshold is 0% meaning that the directors must
exceed the threshold performance for any of the award to vest.
The LTIP metrics and targets for the 2021 award are set out in the
2020 DRR together with details of how the Committee considered
the target ranges to be appropriately stretching. In that context, I am
pleased to say that the 2021 LTIP has vested at 95.4%, driven by the
strong performance in 2021 and 2022.
Over the three-year LTIP performance period, our funds performed
strongly overall, returning $18bn in investment gains and delivering
4.9% of relative outperformance to our clients. We saw record
net inflows of $19.8billion with all our main strategy categories
experiencing positive net flows, which has had a direct positive impact
on our AUM. Relative net flows, a measure of our ability to attract and
retain investor capital in comparison with peers was +6.7% on average
over the last three years, reflecting the strength of the client franchise
and ability to gain market share on a consistent basis.
The growth in AUM has translated to an increase in management fee
revenue each year. Combined with fixed cost discipline and operating
leverage as a result of early and significant investment in technology,
this resulted in strong core management fee EPS growth, in particular
in 2021 and 2022.
Man’s share price has increased by 64.6% over the same three-year
period, compared to an average decrease of 13.7% amongst asset
management peers. Man has delivered TSR of 112.8% which puts it
well into the first quartile of its FTSE 250 peer group.
A summary of the outcome against each of the performance metrics
together with further details of how the Committee established the
stretching target ranges is shown in the ‘Remuneration at a glance’
section on pages 106 with full details included on page 112 of the
annual remuneration report.
Robyn Grew and Antoine Forterre did not receive 2021 LTIP awards
as they were not Executive Directors at the time the LTIP award was
granted. The value of Luke Ellis’ award is set out on page 112. In line
with our policy, as Luke was employed for the full performance period,
he is entitled to retain the full award.
Robyn Grew received her first LTIP award in September 2023. No
long-term variable pay will be included in the single figure table until
this award vests in 2026. The actual outcome of the 2023 award will
be reported in the 2026 DRR.
Man Group plc | Annual Report 2023
In determining whether the overall remuneration of the executive
directors for 2023 was appropriate, the Committee considered a
number of factors including:
• the performance delivered for 2023
• the experience of Man Group’s shareholders. Over the three-year
LTIP performance period, Man Group’s relative TSR of 112.8 % put
it in the top quartile, ranking at position 7 out of 147 companies,
when compared to the FTSE 250 peer group
• the experience of Man Group’s employees. Average employee
bonuses are lower than in 2022, aligning the employee experience
with that of the executive directors.
The Committee concluded that the bonus outcome was fair and
appropriate and therefore no discretion was applied. The Committee
also considered that the LTIP vesting outcome fairly reflected the
performance delivered over the three-year period and no discretion
was applied. As part of its consideration, the Committee satisfied itself
that there were no windfall gains under the LTIP and no adjustments
were required.
Other 2023 Remuneration decisions
During the year, having carefully considered the broader context and
the approach for the wider workforce, the Committee determined that
with effect from 1 January 2024, Antoine Forterre’s salary would be
increased from $654,000 to $680,000 to further align his base salary
with market. This represents an increase of 4.0%, below the budgeted
average employee increase for 2024 of 4.4%.
The annual review of the Chair and non-executive directors’ (NEDs’)
fees was also undertaken during the year. As indicated earlier, no
changes are being proposed to the fees for the Chair. The Board
decided to uplift the NEDs’ base fee from £75,000 to £80,000 with
effect from 1 January 2024 to reflect the significant increase in
workload for the NEDs over the past year and ensure we have a fee
level that enables us to attract NEDs representative of our different
geographies. This is the first change to the base fee since 2020. The
Board also approved an increase in the Senior Independent Director
fee with effect from 1 January 2024 from £15,000 to £25,000, again to
recognise that there had been no change since 2020 and to bring it in
line with the market.
The Committee considered the structure of the annual bonus scheme
and the LTIP and agreed that the overall structure of the annual bonus
including the bonus opportunity, the bonus metrics and weightings will
remain unchanged for 2024. Likewise, there will be no changes to the
LTIP structure, award level, performance measures or their respective
weightings.
1.7 Conclusion
I hope that you find the information in this letter, and the sections of
the DRR that follow, to be clear and useful and I would welcome any
feedback you may have.
We look forward to welcoming you at our 2024 AGM and receiving
your support for this DRR at that meeting.
Laurie Fitch
Chair of the Remuneration Committee
Strategic report | Governance | Financial statements | Shareholder information 104
Directors’ Remuneration report continued
2. Remuneration at a glance
2.1 Directors’ Remuneration Policy summary table
Key elements
2023 2024 2025 2026 2027 2028 2029
Remuneration Policy
Implementation in 2023/24
Fixed pay
Cash
bonus
Deferred
bonus
Long-term
incentive
Share
ownership
Malus and
clawback
Salary
• Overall policy maximum of $1.1m
Salaries effective from 01/01/23:
Pension
allowance
Benefits
Maximum
opportunity
Operation
Maximum
opportunity
Operation
will apply to all executive directors,
meaning no increase for the CEO
over the life of the policy
• Maximum pension contribution
aligned to the maximum available to
all employees of 14% of salary and
subject to the same service criteria to
receive the highest contribution rate
•
Includes family private medical
insurance, life assurance and
permanent health insurance
• Luke Ellis $1.1m*
• Robyn Grew $1.1m**
• Antoine Forterre $654k
* stepped down on 31 August 2023
** appointed 1 Sept 2023
Salaries effective from 01/01/24:
• Robyn Grew $1.1m
• Antoine Forterre $680k
• 300% of salary
Metrics (%)
• Awarded as a combination of cash
(45%) and deferral (55%) into shares
(and funds once the shareholding
requirement has been met) vesting in
three equal tranches in each of the
following three years
Relative net flows
Core management
fee EPS (cents)
Core EPS (cents)
ESG-related objectives
Strategic and
personal objectives
• 300% of salary
Metrics (%)
• Forward-looking three-year
performance conditions with share
grant at year 0, vesting year 3 with
subsequent two-year holding period
Relative investment
performance
Relative TSR vs FTSE 250
3-year cumulative core
management fee EPS
3-year cumulative core EPS
Cumulative relative net flows
ESG scorecard
30
20
20
15
15
20
20
10
30
10
10
Shareholding
requirements
• CEO 300% of salary
• Other executive directors 200% of
salary
Actual shareholdings as at 31/12/23:
• CEO (Robyn Grew) 650%
• CFO (Antoine Forterre) 410%
• CEO (Luke Ellis) 2,654%
Post-
employment
requirements
• 100% of the requirement, or the actual holding on departure if lower, to be
retained for two years after leaving the Board.
Circumstances The Committee may apply malus and/or clawback to variable pay in
certain specified circumstances, including:
• where the director fails to meet the required standards of fitness and propriety;
•
• material misstatement of financial results affecting the assessment of a
fraud or misconduct;
performance condition; or
• where there has been an error or inaccuracy relating to the determination of
variable pay.
In addition, it can apply malus if a director participates in, or was
responsible or accountable for:
• a material error;
• a material downturn in financial performance;
• a material failure of risk management;
• censure by any regulatory authority; or
• a significant detrimental impact on the Company’s reputation.
Malus applies until the end of the vesting period with clawback applying until the
end of any applicable retention period
¬ The full details of the Directors’ Remuneration Policy approved in May 2022 can be viewed at www.man.com.
Man Group plc | Annual Report 2023
Governance
105
2.2 Remuneration outcomes for 2023
2023 Bonus outcome
The targets for relative growth in net flows were set at the same
percentage growth rates as in the previous three years but, given
the considerably higher starting point for AUM, those growth rates
translate into much higher absolute targets than last year. In that
context, relative growth of 4.9.% represents strong performance.
Following a year of record performance in 2022, the core EPS
threshold, target and maximum targets was set 23%, 28% and 21%
higher than in 2022. This resulted in core EPS targets of 25.5 cents,
32.0 cents and 38.5 cents at threshold, target and maximum
respectively. The realised core performance fee EPS of 4.0 cents for
2023 represents an 87% decrease on the exceptional performance
delivered in 2022, driven by a significant reduction in performance
fees. Added to core management fee EPS, the core EPS delivered
was 22.4 cents i.e. below threshold.
Net flows, relative growth (%)
Net Inflows, Relative growth (%)
Core EPS (¢)
53
48.7
38.7
9.8%
4.6%
5.3%
4.9%
-1.2%
6.0% Maximum
3.5% Target
1.0% Threshold
0
21.0
16.2
22.4
38.5 Maximum
32.0 Target
25.5 Threshold
2019
2020
2021
2022
2023
Core management fee EPS
Core performance fee EPS
Details of the performance against the ESG-related objectives, shared
by the executive directors, and their individual strategic and personal
objectives are set out in the table on pages 110 to 111.
20191
2020
2021
2022
2023
1 For 2019, the metric was growth in net flows; from 2020 the metric is growth in relative net
flows. The chart shows absolute growth for 2019 and relative growth from 2020 onwards.
The threshold for core management fee EPS was set at the same
as the 2022 threshold, the target and maximum were set 3% and 6%
higher than the 2022 targets. We delivered core management fee EPS
of 18.4 cents, in line with 2022 despite the growth in net management
fee due to an increase in our fixed cost base as a result of planned
investment to support growth. This represented another year of
excellent performance which delivered a close to maximum payout
under this metric.
Core management fee EPS (¢)
18.4
18.4
15.7
18.5 Maximum
17.0 Target
15.5 Threshold
9.7
10.3
2019
2020
2021
2022
2023
Core EPS includes both management fee and performance fee
related core earnings. The targets are based on the core management
EPS targets, to which are added implicit targets for performance fee
EPS. Given the volatility and unpredictability of performance fees,
those implicit targets are set with a wider range of outcomes.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 106
Directors’ Remuneration report continued
2. Remuneration at a glance continued
Long-Term Incentive Plan outcome (for the period from 1 January 2021 to 31 December 2023)
Targets and outcome
In the 2020 DRR, the Committee set out the targets for the LTIP grant to be made in March 2021 and explained why it considered them to be
appropriately stretching and, if achieved, to represent excellent returns to shareholders. As a reminder, the level of vesting at threshold is 0%
meaning that the directors will only start to receive any value under the LTIP when threshold performance has been exceeded. This represents
a much tougher hurdle than in many listed businesses. The table sets out the target ranges and the performance delivered against them with
further detail below on each metric.
2021 LTIP (1 January 2021 to 31 December 2023)
Metric
Weighting
Threshold
Target
Maximum
Achievement
Outcome
Relative investment performance
25%
0.0%
3.0%
6.0%
4.9%
20.4%
Relative TSR vs. FTSE 250
3-year cumulative core management fee EPS, cents
3-year cumulative core total EPS, cents
Relative cumulative net flows
Total
25%
10%
30%
10%
100%
Median
30.0
42.0
Mid 2nd
quartile
Upper
quartile
Upper
quartile
25.0%
33.0
56.0
36.0
75.0
52.5
10.0%
109.8
30.0%
0.0%
9.0%
18.0%
20.0%
10.0%
95.4%
The targets for relative cumulative net flows required
outperformance of 0%, 9% and 18% at target, threshold and
maximum respectively. The achievement of 20.0% of relative
growth on this measure represents an excellent outcome for all
Man Group’s investors.
Over the three-year LTIP performance period, Man Group has
delivered excellent results and this performance is reflected in the
2021 LTIP vesting level being 95.4%, as set out above and in more
detail on page 112. The Committee specifically reviewed the impact of
the share buybacks implemented over the period on the realised EPS
metrics, and therefore the overall LTIP outcome, and concluded that
no adjustments to the outcome were required. It noted that both the
cumulative core management fee and cumulative core EPS metrics
would have been fully met even if the share count was unchanged
from the end of 2020. The Committee also reviewed the impact of
foreign exchange movements and noted that they were negative
overall. This was because the benefit on costs of a better USD:GBP
exchange rate was outweighed by the negative impact on AUM and
therefore revenues. The Committee also satisfied itself that there were
no windfall gains.
Relative investment performance measures outperformance
against our peers and the threshold of 0% means the directors are
only rewarded under this measure if Man Group outperforms its
peers. Over the three-year performance period relative investment
performance of 4.9% was between target and maximum, resulting
in a payout of 20.4% for this metric. Delivery of almost 5% relative
outperformance versus our peers implies $6 billion more for
our fundholders.
Relative TSR vs. FTSE 250 measures how Man Group’s Total
Shareholder Return compares to that of the constituents of the FTSE
250 excluding investment trusts, funds and REITs. Out of a population
of 147 stocks still listed at the end of December 2023 (from 173 at the
beginning of the measurement period), Man Group has again
delivered relative TSR in the top quartile, ranking at number 7 out of
the peer group.
The targets for 3-year cumulative core management fee EPS
were established in absolute terms at 30 cents at threshold,
33 cents at target and 36 cents at maximum. The targets required
core management fee EPS to be, on average, 7% and 17% higher
than achieved in 2020 at target and maximum respectively over three
years which the Committee considered to be appropriately stretching.
Cumulative core management fee EPS of 52.5 cents has been
driven by outstanding performance over the period, especially in 2021
and 2022.
As described earlier, core EPS is the sum of core management fee
EPS and core performance fee EPS, with the latter being the more
volatile and unpredictable element of core EPS. The threshold, target
and maximum were established at 42 cents, 56 cents and 75 cents.
One way in which the Committee satisfied itself that these targets
were appropriately stretching was by reviewing the cumulative core
EPS delivered in the three-year periods ending on each of the previous
five years. This showed that the threshold had only been achieved
on two occasions during that time and the target and maximum were
6% and 43% higher respectively than had been achieved at any time
during that period. A record three-year cumulative core EPS outcome
of 109.8 cents was delivered.
Man Group plc | Annual Report 2023
Governance 107
2.3 Executive director pay in the context of Man Group’s shareholders
The chart below shows the TSR generated since Luke Ellis’s appointment as CEO in September 2016, including the period between
1 September 2023 and 31 December 2023 when Robyn Grew took over from Luke as CEO. This is compared to both the FTSE 250
and the FTSE 350 Financial Services Index and shows Man Group’s outperformance against both sets of peers.
Total Shareholder Return (TSR) (Sep 2016 – Dec 2023)
400
300
200
100
0
Sep
2016
Dec
2016
June
2017
Dec
2017
June
2018
Dec
2018
June
2019
Dec
2019
June
2020
Dec
2020
June
2021
Dec
2021
June
2022
Dec
2022
June
2023
Dec
2023
Man Group TSR
FTSE 250 TSR
FTSE 350 Financial Services TSR
Source: Bloomberg
The chart below shows the executive directors’ shareholdings compared with their shareholding requirements. Under the Remuneration
Policy, shares owned outright and those deferred shares that no longer have performance conditions attached count towards the shareholding
requirement. LTIP shares retained during the two-year post-vesting holding period also count towards the requirements. Shares which are not
owned outright are shown net of tax (i.e. excluding that proportion of those shares expected to be sold on vesting to settle the associated tax
liability). All executive directors comfortably exceed their shareholding requirement.
Executive directors’ shareholdings (number of shares)
Luke Ellis (requirement = 300% of salary)
9,857,757 shares
Antoine Forterre (requirement = 200% of salary)
906,561 shares
Robyn Grew (requirement = 300% of salary)
2,416,225 shares
0
300
600
900
1,200
1,500
1,800
2,100
2,400
2,700
3,000
% of salary
Shareholding requirement
Shares owned outright
Shares no longer subject to performance conditions (net)
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
108
Directors’ Remuneration report continued
2. Remuneration at a glance continued
2.4 Executive director pay in the context of Man Group’s employees
In determining the appropriate remuneration for the executive directors, the Committee carefully considered conditions for employees across
the firm. A high calibre, motivated workforce, appropriately rewarded for their contributions, is a critical component of our success and the table
below illustrates remuneration paid to the executive directors in the context of the wider workforce.
CEO – single total remuneration figure (SFT) ($’000)
Ratio of SFT to median UK employee1
Compensation – all employees ($m)2
Compensation ratio3
Number of bonus-eligible employees
Mean annual bonus award per bonus-eligible employee ($’000)
Median annual bonus award per bonus-eligible employee ($’000)
CEO SFT as % of total compensation of all employees
Aggregate total SFT of all executive directors as % of total compensation of all employees
Year ended
31 December
2023
9,108
60:1
592
50%
1,655
201
35
1.5%
1.9%
Year ended
31 December
20224
13,332
76:1
718
40%
1,508
323
54
1.9%
2.2%
1 See table R8 on page 115 for the full disclosure of the CEO ratio.
2 Compensation for all employees represents total fixed pay (salary, pension and benefits) and variable pay in respect of 2023.
3 Compensation ratio represents total core compensation costs for all employees (fixed base salaries, benefits, variable bonus compensation and associated social security costs) as a proportion
of core net revenue (gross management and other fees, performance fees, income or gains on investments and other financial instruments, and share of post-tax profits of associates, less
distribution costs).
4 2022 numbers have been restated to reflect the actual value of the LTIP that vested in March 2023, based on the share price and exchange rate on that date; in the 2022 DRR, the number was
estimated based on a three-month average share price and the exchange rate at the end of 2022.
Man Group plc | Annual Report 2023
Governance 3. Remuneration outcomes in 2023
109
3.1 Single total figure of remuneration for executive directors
The table below sets out a single figure for the total remuneration received by each executive director for the year ended 31 December 2023
and the prior year.
Single total figure of remuneration for executive directors (audited) – Table R1
Executive directors
All figures in USD
Salary
Taxable benefits3
Pension benefits4
Other5
Total fixed remuneration
Short-term variable6
Long-term variable7,8
Total variable remuneration
Total
Robyn Grew1
2023
366,667
208,016
46,609
844
622,136
711,700
–
711,700
1,333,836
2022
–
–
–
–
–
–
–
–
–
Former executive director
Luke Ellis2
2022
625,000
3,127
76,014
9,175
713,316
1,740,000
Antoine Forterre
2023
654,000
3,337
82,827
16,601
756,765
1,269,414
–
1,269,414
2,026,179
1,740,000
2,453,316
2023
733,333
1,780
92,161
6,737
834,011
1,401,400
– 5,538,351
2022
1,100,000
2,499
132,654
10,050
1,245,203
3,128,400
8,958,722
6,939,751 12,087,122
7,773,762 13,332,325
1 Remuneration disclosed for 2023 is in connection with Robyn Grew’s role as an executive director. Robyn Grew was appointed to the Board on 1 September 2023.
2 Luke Ellis stepped down from the Board on 31 August 2023. Remuneration disclosed for 2023 reflects the period during the year that he was an executive director of the Company
(1 January 2023 – 31 August 2023).
3 Taxable benefits include private medical insurance. The remuneration disclosed for Robyn Grew includes costs associated with her relocation from the US to the UK, which consist of costs paid
for temporary accommodation ($168,865), flights ($23,491) and other travel expenses ($4,375). These costs were incurred following the announcement of her appointment as CEO.
4 Pension benefits are paid into the Man Group Self-Invested Personal Pension with any contributions exceeding the annual or lifetime allowance paid as cash on a cost neutral basis to
the Company.
‘Other’ includes non-taxable benefits (e.g. life insurance, Group income protection and fund fee rebates).
5
6 See table R2 for details of the short-term variable compensation award. The Committee has not applied any discretion to the formulaic outcome.
7 The 2021 award under the Man Group plc LTIP was made in March 2021 for the three-year performance period commencing on 1 January 2021 and ending on 31 December 2023. Vested
shares will be delivered following a further two-year holding period. See table R4 for details of the long-term variable compensation award. The LTIP award was originally based on the market
value of a Man Group plc share on 11 March 2021 being £1.5445. The value shown above therefore includes $1,865,452 which relates to share price growth over the performance period.
Antoine Forterre and Robyn Grew did not receive an award under the March 2021 LTIP as they were both appointed to the Board after this date.
8 The long-term variable outcome reported in 2022 was estimated based on the three-month average share price and year-end exchange rate. It has been restated above to reflect the actual share
price of £2.858 and exchange rate of £1:$1.1865 on the date it vested in March 2023. Vested shares are subject to a further two-year retention period.
3.2 Annual bonus in respect of 2023 performance
The annual bonus is based on the Committee’s assessment of executive directors’ performance against objectives agreed by the Board
at the beginning of the year, split 70% based on quantitative metrics, 15% on ESG-related objectives and 15% on individual strategic
and personal objectives. The threshold, target and maximum ranges are considered by the Remuneration Committee to represent
appropriately stretching levels of performance and are set by reference to internal budgets and strategic plans, industry backdrop and
external expectations, as covered in more detail in the Chair’s letter and ‘Remuneration at a glance’ section.
Table R2 shows the results of the Committee’s assessment of the performance delivered in 2023.
Annual bonus in respect of 2023 (audited) – Table R2
2022
actual
5.3%
18.4
48.7
n/a
Financial metric
Relative net flows
Core management fee EPS (cents)1
Core EPS (cents)1
Total financial metrics
ESG-related objectives2
Total financial metrics and ESG
objectives
Strategic and personal objectives
Percentage of maximum annual
bonus awarded
Quantum of award – total3
Quantum of award – paid in cash
Quantum of award – deferred
Weighting
30%
20%
20%
70%
15%
85%
15%
100%
Threshold
Target
Maximum
2023
Bonus outcome
after weighting
%
(25% of max)
1.0%
15.5
25.5
(50% of max)
3.5%
17.0
32.0
(100% of max)
6.0%
18.5
38.5
outcome
4.9%
18.4
22.4
achieved
78%
97%
0%
Robyn Grew3
Antoine
Forterre
(% of max)
23.4%
19.3%
0.0%
42.7%
10.0%
52.7%
Luke Ellis
12.0%
12.0%
11.0%
64.7%
64.7%
$711,700 $1,269,414
$571,236
$320,265
$698,178
$391,435
63.7%
$1,401,400
$630,630
$770,770
1 The Committee specifically reviewed the impact of the Varagon acquisition on the realised EPS metrics, and therefore the overall bonus outcome, and concluded that no adjustments to the
outcome were required. The outcome excludes the impact for relative net flows.
2 The ESG objectives relating to the 2023 annual bonus can be found on page 110.
3 45% of the bonus is paid in cash with the remaining 55% deferred into Man Group plc shares; when a director achieves their shareholding requirement, up to half of the deferral may be into
Man Group funds and the balance into shares. No further performance conditions apply to the deferral, which vests in three equal tranches on the first, second and third anniversary of grant
subject, in normal circumstances, to continued employment.
4 Values for Robyn Grew are for services as an executive director (from 1 September 2023).
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 110
Directors’ Remuneration report continued
3. Remuneration outcomes in 2023 continued
Assessment of performance against qualitative objectives
Objective
ESG related1
Climate and sustainability
Improvements in Man Group’s
environmental impact enabling us
to meet our SBTi corporate targets
for a 1.5-degree future
Continue to broaden sustainability
fund offering
Diversity, equity and inclusion
Build long-term talent pipeline with a
focus on diversity
Social fairness
Ensure Man Group behaves fairly
towards all employee stakeholders
(direct and indirect)
Strategic and personal
Robyn Grew
Strategy and innovation
Undertake a full strategic review, with
a focus on supporting Man Group’s
future growth
Strategic integration
Ensure the successful completion
of the announced transactions with
Varagon Capital Partners and Asteria
(partnership with Fideuram), and
establishment of appropriate
integration plans
Talent
Promote, appoint and structure the
senior leadership team required to
deliver continued future growth
Outcome
Assessment
Progress towards net zero goals is on track, with targets for Scope 1, 2, and 3 set out and emissions
data reviewed quarterly. Audit of Riverbank House resulted in a number of findings to optimise
emissions reductions that are being implemented.
A total of eight new sustainability funds were launched or added through acquisition.
Since 2018 when Man Group signed the Women in Finance Charter 2018, we are pleased to have
seen a positive trajectory in the proportion of women in senior management roles.
As of December 2023, 31% of the senior management team were female, achieving our target for
2024 of 30% a year early. In 2022, 26% of the senior management were female.
During 2023, a new target was set to increase ethnicity in senior management to 15% by the end of
2027. As at the end of November, 87% of our staff had completed their ethnicity data. This new
target works alongside our existing focus on building a diverse workforce and specifically, increasing
the representation of ethnic minorities.
Continued positive feedback from employees (through the employee engagement survey) on the
firm’s diversity, equity and inclusion initiatives.
In the US, all our employees are paid in line with the US Living Wage and in the UK all our employees
are paid in line with the London Real Living Wage. We continue to work with our suppliers to
promote being a London Real Living Wage payer.
For the second year running, a tiered salary review was conducted, whereby the lowest paid
employees were prioritised for higher salary increases.
A full strategic review was undertaken in 2023 which was discussed with and approved by the
Board. The review focused on continuing to invest in and develop the strength of Man’s business
and culture to enable future growth.
The completion of the Varagon acquisition was announced in September 2023 with all key day-one
deliverables achieved, marking the end of Phase 1 of the integration.
The completion of the Asteria integration was announced at the end of October 2023 and a new
partnership with Fideuram was launched.
Successful restructure of the senior leadership team including a new streamlined Executive
Committee, promoting internal talent.
In-depth review of talent bench-
strength to ensure talent in place
to support strategy.
Wider reorganisation delivered with a series of internal promotions, reflecting talent bench across the
organisation. Review process undertaken, targeting key talent to ensure retention. Voluntary attrition
in 2023 was 7.0% down from 10.7% in 2022.
Enhanced development and
succession plans across
the organisation
Succession plans completed and reviewed.
1 The ESG-related objectives are shared by the CEO and CFO.
Man Group plc | Annual Report 2023
Governance 111
Outcome
Assessment
Reporting review completed, providing increased transparency and automation on engine and
product level performance which will aid in business decision-making. Significant contribution to
strategic review.
M&A: multiple opportunities assessed in 2023 with acquisition of Varagon identified as meeting
acquisition criteria and subsequently completed. New partnership with Fideuram launched.
Operational risk framework revamped with new organisation structure in place. New risk
management and governance platform successfully rolled out and policy framework amended with
new dashboards.
Review of Internal Audit model conducted with further review planned for 2024.
Assessment of the People function completed with actions identified for implementation during
2024.
External review of UK Defined Benefit scheme undertaken with external provider. All options were
considered but it was determined that no changes will be made at present; the scheme will be kept
under review.
Establishment of quant trader function across asset classes and steady progress on roll-out of
central OMS.
Successful first paying customer for Arctic (Bloomberg), HUB on track with original business plan.
Continued launches of new products and solutions, including the first Exchange Traded Fund (ETF)
and a crypto strategy; fourteen new investment strategies seeded across the business.
Successful roll-out of ManGPT, open to all employees at the firm. Establishment of a tech Machine
Learning team to drive innovation across the organisation.
Continued focus on retention, resulting in the second-best year in ten for firm-wide attrition. Voluntary
attrition in 2023 was 7.0% down from 10.7% in 2022.
Succession plans completed and reviewed.
Increase in Institutional Solutions AUM to $16.2bn* and number of solutions with institutional clients
to 46* ($14.4bn and 38 respectively in FY 2022).
Wealth partnerships established with Fideuram and in progress with SBI.
Establishment of formal insurance sales coverage team.
*as at 31 Dec 2023. The Committee considered and is satisfied that the year to date numbers were higher as at 31 August 2023.
Objective
Strategic and personal
Antoine Forterre
Strategy and innovation
Conduct a review of internal reporting
with a view to supporting decision-
making and tracking progress against
strategy
Continue to review inorganic
growth opportunities
Risk and controls
In-depth review of the Group’s overall
operational risk framework
Re-evaluate the current Internal
Audit model
Stakeholders
Review the Group’s People functions
with the aim to support its strategy
more effectively
Assess options to de-risk UK defined
benefit pension plan further
Strategic and personal
Luke Ellis
Strategy and innovation
Lead the development of new
investment strategies, solutions, or
initiatives to support long-term alpha
generation and growth
Talent
In-depth review of talent bench-
strength to ensure talent in place to
support strategy more effectively
Enhanced development
and succession plans across
the organisation
Stakeholders
Further expansion and diversification
of the client base with a particular
focus on new solutions and
insurance/wealth channels
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 112
Directors’ Remuneration report continued
3. Remuneration outcomes in 2023 continued
3.3 Vesting outcome in respect of the 2021 Long-Term Incentive Plan
Long-term incentive awards are made under the Man Group plc Long-Term Incentive Plan (the LTIP). Awards vest at 0% for threshold
performance, 50% for target performance and 100% of the award will vest if the performance conditions are achieved in full, with straight-line
vesting between threshold and target and between target and maximum. The 2021 LTIP was awarded in March 2021 for the three-year
performance period from 1 January 2021 to 31 December 2023. The vesting of the 2021 LTIP was subject to the achievement of five
performance measures. The targets and vesting outcomes for the 2021 LTIP are shown in the table below:
Vesting outcome for 2021 LTIP award (audited) – Table R3
Performance measures for 2021 LTIP1
Performance targets
Actual performance
Measure
Relative investment performance
Cumulative relative net flows
3-year cumulative core management fee EPS (cents)
3-year cumulative core total EPS (cents)
Relative TSR vs FTSE 250
Vesting of LTIP (% maximum)
Threshold
0.0%
0.0%
30.0
42.0
Median
Target
3.0%
9.0%
33.0
56.0
Mid point
between
median
and upper
quartile
Maximum
6.0%
18.0%
36.0
75.0
Outcome
4.9%
20.0%
52.5
109.8
Percentage
met
82%
100%
100%
100%
Weighting
25%
10%
10%
30%
Upper
quartile
Upper
quartile
100%
25%
LTIP
outcome,
after
weighting
20.4%
10.0%
10.0%
30.0%
25.0%
95.4%
1 The Committee specifically reviewed the impact of the Varagon acquisition over the period on the realised EPS metrics, and therefore the overall LTIP outcome, and concluded that no adjustments
to the outcome were required. The outcome excludes the impact for relative net flows and relative investment performance.
Vesting outcome for 2021 LTIP award (audited) – Table R4
Executive director
Luke Ellis
Date of grant
Shares
awarded1
Vesting
percentage
Number of
shares vesting
Value of
shares vesting
Vesting date
End of holding
period
12 Mar 21
2,063,091
95.4% 1,968,189 $5,538,351
Mar-24
Mar-26
1 Awards under the LTIP were made in March 2021 for the three-year performance period commencing on 1 January 2021 and ending on 31 December 2023; the proportion of the award which
has vested was determined based on the measures, weightings and target ranges set out in table R3 above. The monetary value of these awards was converted into a number of shares using
the GBP/USD exchange rates of $1 = £0.7159 and a share price of £1.5445, being the market value on the immediately preceding dealing day to grant. This award attracts dividend accruals from
grant date to the end of the two-year holding period for vested shares.
3.4 Relative importance of spend on pay
The table below shows the year-on-year change in total employee expenditure compared with the change in shareholder distributions.
Relative importance of spend on pay – Table R5
Total employee expenditure1
Shareholder distributions2
2023
$m
595
404
2022
$m
678
565
%
change
-12
-28
1 Remuneration paid to or receivable by all employees (i.e. accounting cost excluding other employment-related expenses in relation to Varagon acquisition accounting). Refer to Note 5 to the Group
financial statements for further details.
2 Distributions to shareholders (dividends paid of $179 million and repurchase of shares of $386 million in 2022, dividends paid of $181 million and repurchase of shares of $223 million in 2023).
Man Group plc | Annual Report 2023
Governance 113
3.5 Review of past performance
The performance graph below compares the Company’s Total Shareholder Return (TSR) performance against the FTSE 250 Index and the
FTSE 350 Financial Services Index. The FTSE 250 has been chosen as the primary comparator to align with the peer group used in the LTIP.
Prior to 2019, Man Group had chosen the FTSE 350 Financial Services Index as the comparator group so it has also been shown below,
for reference.
Total Shareholder Return graph (Dec 2013 – Dec 2023)
600
500
400
300
200
100
0
Dec
2013
Dec
2014
Dec
2015
Dec
2016
Dec
2017
Dec
2018
Dec
2019
Dec
2020
Dec
2021
Dec
2022
Dec
2023
Man Group TSR
FTSE 250 TSR
FTSE 350 Financial Services TSR
Source: Bloomberg
Historical CEO remuneration – Table R6
Accounting period ended
CEO single figure ($’000) R Grew1
Short-term variable award
(as a percentage of
maximum opportunity)
Long-term variable award
(as a percentage of
maximum opportunity)
1 Robyn Grew was appointed as CEO with effect from 1 September 2023. Remuneration disclosed for 2023 reflects four months’ service only. Robyn Grew was awarded her first LTIP in 2023.
31 Dec
2016
n/a
1,347
910
n/a
40.2%
n/a
n/a
28.6%
n/a
31 Dec
2017
n/a
6,215
n/a
n/a
78.8%
n/a
n/a
46.2%
n/a
31 Dec
2018
n/a
2,856
n/a
n/a
58.3%
n/a
n/a
n/a4
n/a
31 Dec
2019
n/a
2,804
n/a
n/a
56.3%
n/a
n/a
n/a4
n/a
31 Dec
2020
n/a
3,150
n/a
n/a
69.4%
n/a
n/a
n/a4
n/a
31 Dec
2021
n/a
31 Dec
2022
n/a
7,797 13,3325,6
n/a
n/a
94.8%
n/a
n/a
60.0% 84.6%5,6
n/a
n/a
n/a
98.5%
n/a
n/a
n/a
31 Dec
2014
n/a
L Ellis2
n/a
E Roman3
5,068
R Grew1
n/a
L Ellis2
n/a
E Roman3 100.0%
R Grew1
n/a
L Ellis2
n/a
E Roman3
40.0%
31 Dec
2015
n/a
n/a
5,367
n/a
n/a
83.3%
n/a
n/a
40.7%
31 Dec
2023
1,334
7,774
n/a
64.7%
63.7%
n/a
n/a
95.4%
n/a
Consequently no long-term variable awards are shown for Robyn Grew in the table above.
2 Luke Ellis was appointed CEO on 1 September 2016. Remuneration for 2016, therefore, reflects four months’ service only. Luke Ellis stepped down from the Board on 31 August 2023 and will
remain on garden leave until his retirement in May 2024.
3 Emmanuel Roman became CEO on 28 February 2013 and stepped down on 31 August 2016.
4 The first award under the LTIP was made in March 2019 and vested in March 2022. Consequently no long-term variable awards are shown for Luke Ellis in 2018, 2019 and 2020.
5 The Committee exercised its discretion and reduced the number of shares initially awarded under the 2020 LTIP by 10.6%.
6 The long-term variable outcome reported in 2022 was estimated based on a three-month average share price and year-end exchange rate. It has been restated in the CEO single figure table as set
out on page 109.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 114
Directors’ Remuneration report continued
3. Remuneration outcomes in 2023 continued
3.6 Percentage change in directors’ remuneration
The table below sets out the percentage change in remuneration for the directors compared with all staff. This requirement was introduced in
2020 and therefore the data will progressively build up to cover a five-year period. There are no employees of the Parent Company, other than
the executive directors, so the comparison has been made, on a voluntary basis, to all staff.
Percentage change in directors’ remuneration – Table R7
2023
20222
20212
20202
Salary/
fees
Benefits1
Bonus
Salary/fees
Benefits
Bonus
Salary/fees
Benefits
Bonus
Salary/fees
Benefits
Bonus
Executive directors
Robyn Grew3
–
Antoine Forterre
5%
Former executive director
Luke Ellis4
0%
Non-executive directors
Anne Wade5
Kate Barker6
Lucinda Bell
Richard Berliand
John Cryan7
Laurie Fitch8
Jackie Hunt9
Ceci Kurzman10
Alberto Musalem11
All staff12
6%13
5%
67%
2%
0%
-21%
0%
-10%
0%
-67%
10%
–
–
-88%
0%
5%
41%
0% 158%
4%13
–
7%
–
-27%
7%
-33%
–
–
–
–
–
–
–
–
–
-47%14
–
0%
0%
11%
15%
-11%
-6%
0%
–
–
8%
–
6%13
–
-7%
–
24%
–
–
–
–
–
–
–
–
–
–
–
–
-7%
15%
0%
6%
42%
0%
-9%
23%
-4%
73%
340%
196%
143%
–
–
313%
–
4%13
–
–
–
–
–
–
–
–
–
18%14
15%
1%
6%
-10%
0%
–
–
0%
–
3%13
–
-6%
618%
-40%
273%
–
–
–
–
15%13
–
–
–
–
–
–
–
–
–
84%14
–
–
10% 1,153%
–
341%
-4%
–
–
–
–
22%13
–
8%
400%
–
–
–
–
4%13
–
–
–
–
–
–
–
–
–
-15%14
1 Taxable benefits include private medical insurance and relocation expenses for executive directors and includes travel, staff entertainment expenses and gifts, and the tax paid in relation to such
benefits for non-executive directors. The percentage change in benefits for the non-executive directors should be read in conjunction with the data showing actual taxable benefits in table R9
(page 115), which shows that the large percentage movements recorded above are explained by movements in small absolute numbers.
2 Disclosures in respect of prior years can be found in the relevant Directors’ Remuneration reports.
3 Robyn Grew was appointed to the Board on 1 September 2023 and therefore a percentage change has not been disclosed.
4 Luke Ellis stepped down from the Board on 31 August 2023, however the salary, benefits and bonus that he received during the period he was an executive director of the Company have been
annualised for the purposes of calculating the percentage changes.
5 Anne Wade stepped down as Remuneration Committee Chair and was appointed as Chair of the Board on 1 October 2023.
6 Kate Barker stepped down from the Board on 1 April 2023. The fees received for the period she was a non-executive director during 2023 have been annualised for the purposes of the calculation
shown above.
7 The Board agreed an increase in the Chair fee effective 1 January 2023; however, John Cryan stepped down from the Board on 30 September 2023. These changes are reflected in the calculation
shown for 2023; however, for the purposes of showing the percentage change for his fees the amount received during 2023 has been annualised.
8 Laurie Fitch was appointed to the Board on 25 August 2023 and therefore no percentage change has been recorded.
9 Jackie Hunt stepped down from the Board on 27 March 2023; however, the fees received for the period she was a non-executive director in 2023 have been annualised for the purposes of the
calculation shown above.
10 Ceci Kurzman was appointed as the designated employee engagement non-executive director during 2022 and is paid an annual fee of £7,500 for the role. Ceci was appointed as a member of the
Remuneration Committee effective 1 October 2023 and therefore the increase in total fees has been reflected in the calculation above.
11 Alberto Musalem was appointed to the Board on 1 November 2022. His fees for 2022 have been annualised for the purposes of calculating the percentage change in 2023.
12 Figures are calculated on an annualised full-time-equivalent (FTE) basis (excluding directors). Figures shown for 2020 were disclosed on a per capita basis.
13 Represents the average increase in salary and taxable benefits in underlying currency in which each member of staff is paid.
14 For staff, bonus includes both variable cash compensation and deferred awards relating to the current year.
Man Group plc | Annual Report 2023
Governance 115
3.7 CEO pay ratio
The table below compares the 2023 single total figure of remuneration, which comprises the combined sum of Robyn Grew’s and Luke Ellis’
single total figure of remuneration as shown in Table R1 with that of Man Group’s UK employees who are paid at the 25th percentile (lower
quartile), 50th percentile (median) and 75th percentile (upper quartile).
Table R8
Year
2023
20221
2021
2020
2019
Method
A
A
A
A
A
25th percentile
pay ratio
90:1
126:1
68:1
29:1
26:1
50th percentile
pay ratio
60:1
76:1
42:1
19:1
17:1
75th percentile
pay ratio
34:1
39:1
23:1
11:1
10:1
1 The long-term variable outcome reported in 2022 was estimated based on the three-month average share price and year-end exchange rate. It has been restated in the CEO single figure for 2022 as
set out in more detail on page 109; consequently the CEO ratio numbers above have also been restated.
The Committee reviewed the CEO ratio when compared with previous years. A significant proportion of the CEO’s total remuneration is
delivered in variable remuneration. In order to drive alignment with investors, the value ultimately received from LTIP awards is linked to long-term
share price movement. As a result, the pay ratio is likely to be driven largely by the CEO’s incentive outcomes and may therefore fluctuate
significantly on a year-to-year basis.
The median pay ratio for 2023 is lower than the ratio for 2022. This is primarily driven by the lower level of CEO bonus payout and the lower
value of the vested LTIP award. The value of the vested LTIP (2021 LTIP award) included in the 2023 ratio relates to Luke Ellis’ LTIP award. Whilst
Robyn Grew received an LTIP award in 2023, this award will not vest until 2026. The Committee considers that the median pay ratio for 2023
and the recent trends in the pay ratios are consistent with Man Group’s remuneration framework and reflect the variable nature of the CEO’s
total remuneration. The Committee believes the pay ratio is consistent with our pay policies in the UK.
The ratio has been calculated using Option A methodology, which uses actual employee data. The Committee considered this to be the most
accurate approach. Total full-time equivalent remuneration for people employed for the full 12-month period ending on 31 December 2023 has
been calculated in line with the methodology for the ‘single figure of remuneration’ for the CEO (table R1, page 109). This data was then ranked
to identify the individuals at the 25th, 50th and 75th percentiles and the salary and total pay and benefits for the three identified quartile point
employees are shown in the table below.
All figures in USD
Salary
Total pay and benefits
3.8 Retirement benefits
25th percentile
89,649
101,097
50th percentile
118,287
151,181
75th percentile
169,337
265,376
Robyn Grew, Antoine Forterre and Luke Ellis are not eligible for any defined benefits under the Man Group plc Pension Plan.
3.9 Single total figure of remuneration for non-executive directors
The table below sets out a single figure for the total remuneration received by each non-executive director for the year ended 31 December
2023 and the prior year.
Single total figure of remuneration for non-executive directors (audited) – Table R9
Fees
Taxable benefits4
Total
All figures in GBP
Anne Wade (Chair from 1 October 20231)
John Cryan (Chair to 30 September 20232)
Kate Barker2
Lucinda Bell
Richard Berliand
Laurie Fitch3
Jackie Hunt2
Ceci Kurzman
Alberto Musalem
1 Anne Wade was appointed as Chair of the Board on 1 October 2023.
2 Jackie Hunt stepped down from the Board on 27 March 2023, Kate Barker on 1 April 2023 and John Cryan on 30 September 2023 and their remuneration has been pro-rated accordingly.
3 Laurie Fitch was appointed to the Board on 25 August 2023 and her remuneration has been pro-rated accordingly.
4 Taxable benefits comprise travel, gifts and staff entertainment expenses and the tax paid in relation to such benefits.
2023
208,294
322,983
29,116
112,170
117,170
48,870
25,380
96,223
111,158
2023
175,000
288,750
26,875
110,000
115,000
40,256
25,000
85,000
100,000
2022
105,000
350,000
107,500
110,000
115,000
–
83,718
81,250
16,667
2022
31,758
104,414
2,201
2,751
2,422
–
3,165
7,946
4,331
2023
33,294
34,233
2,241
2,170
2,170
8,614
380
11,223
11,158
2022
136,758
454,414
109,701
112,751
117,422
–
86,883
89,196
20,997
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 116
Directors’ Remuneration report continued
3. Remuneration outcomes in 2023 continued
3.10 Payments for loss of office (audited)
There were no payments for loss of office made to executive directors during the year.
3.11 Payments to past directors (audited)
Luke Ellis stepped down from the Board on 31 August 2023. His 12-month notice period commenced following the notification of his retirement
in May 2023 and he began his garden leave from 1 September 2023. He remains employed by the Company until 10 May 2024 and he will
receive his salary, contractual benefits and pension supplement in full until this date. His 2023 bonus has been pro-rated for the period he was
an executive director of the Company. For further information on the treatment for the 2023 bonus and Luke’s outstanding awards under the
Deferred Share Plan see tables R2 and R15. As a retiree, he retains his right to outstanding LTIP awards as detailed in table R13. He retains his
right to the full award for his 2021 LTIP given he was employed for the full performance period; however, his 2022 and 2023 LTIP awards will be
pro-rated for time.
Mark Jones stepped down from the Board on 1 October 2021. The value of his 2021 award LTIP was $3,146,786. This award is subject to same
performance conditions and vesting outcomes as disclosed in table R3 and R4.
3.12 Directors’ interests
Directors’ interests in shares of Man Group plc (audited) – Table R10
Executive directors
Robyn Grew
Antoine Forterre
Former executive director
Luke Ellis3
Non-executive directors
Anne Wade
Kate Barker4
Lucinda Bell
Richard Berliand
John Cryan4
Laurie Fitch
Ceci Kurzman
Jackie Hunt4
Alberto Musalem
Number of
ordinary
shares1
31 December
20232
Number of
ordinary
shares1
31 December
2022
1,460,160
579,031
–
498,932
7,194,916
6,806,054
44,000
52,166
–
75,000
40,000
–
–
–
–
30,000
52,166
–
75,000
40,000
–
–
–
–
1 All of the above interests are beneficial.
2 There has been no change in the directors’ interests in the ordinary shares of Man Group plc from 31 December 2023 up to 28 February 2024, being the latest practicable date prior to the
publication of this report.
3 Luke Ellis stepped down from the Board on 31 August 2023, however the shareholding is disclosed as at 31 December 2023.
4 Jackie Hunt, Kate Barker and John Cryan stepped down from the Board on 27 March 2023, 1 April 2023 and 30 September 2023 respectively. Where applicable, their shareholdings are shown as
at the date of their departure from the Board.
Executive directors’ shareholdings measured against their respective shareholding requirement as at 31 December 2023
(audited) – Table R11
Executive directors
Robyn Grew
Antoine Forterre
Former executive director
Luke Ellis
Shares owned
outright
Shares no
longer subject
to performance
conditions1
Total
shareholding2
Value of
shareholding3
(USD)
Annual salary
(USD)
Shareholding
requirement as
a % of salary
Current
shareholding
as a % of
salary
Requirement
met?
1,460,160
579,031
956,065
327,530
2,416,225
906,561
7,154,999
2,684,536
1,100,000
654,000
300%
200%
650%
410%
7,194,916
2,662,841
9,857,757 29,191,092
1,100,000
300%
2654%
Yes
Yes
Yes
1 Unvested deferred shares and vested LTIP shares are shown on a net of tax basis. Details of unvested awards can be found in tables R13 and R15.
2 Shares that count towards achievement of the shareholding requirement are limited to: (i) shares owned outright; (ii) unvested deferred shares granted under the Deferred Share Plan (DSP); and (iii)
vested LTIP shares which are no longer subject to performance conditions and which will be delivered at the end of the two-year holding period.
3 Shareholdings for Robyn Grew, Antoine Forterre and Luke Ellis are valued at 29 December 2023 share price of £2.3260 and a GBP/USD exchange rate of £1 = $1.2731.
Man Group plc | Annual Report 2023
Governance 117
3.13 Directors’ interests in shares and options under Man Group long-term incentive plans
Scheme interests to be awarded under the Man Group plc Long-Term Incentive Plan (LTIP)1 (audited) – Table R12
Executive directors
Robyn Grew
Antoine Forterre
Award
(% of salary)
Award value2
(USD)
Vesting
date
End of holding
period date
300% 3,300,000
300% 2,040,000
Mar-27
Mar-27
Mar-29
Mar-29
1 Awards under the LTIP will be made in March 2024 for the three-year performance period commencing on 1 January 2024 and ending on 31 December 2026; the proportion of the award which
vests will be determined based on the measures, weightings and target ranges set out in table R20 (page 119). 0% of the award will vest at threshold with straight-line vesting between threshold and
target and target and maximum performance. 100% of the award will vest for maximum performance.
2 The face value of the awards represents 300% of salary. The monetary value of these awards will be converted into a number of shares using the USD/GBP exchange rate and the market value on
the immediately preceding dealing day to grant. The awards will be granted as conditional awards of shares and will vest, to the extent the performance conditions have been achieved, three years
later and will then be subject to a further two-year holding period, under the LTIP rules, following which shares will be delivered. These awards attract dividend accruals from grant date to the end of
the two-year holding period for vested shares.
Conditional share awards under the Long-Term Incentive Plan (LTIP) – subject to performance conditions and
holding period (audited) – Table R13
Executive directors
Robyn Grew
Antoine Forterre
Former executive director
Luke Ellis
Date of grant
1 January
2023
Granted during
the year
Lapsed during
the year
Dividends
accruing4
31 December
2023
Vesting
date5
End of
holding period6
Sep-23
Mar-22
Mar-23
Mar-19
Mar-20
Mar-21
Mar-223
Mar-233
– 1,238,3591
–
576,3112
769,851
–
–
–
–
25,331 1,263,690
44,855
814,706
33,578
609,889
1,587,079
3,491,991
1,949,503
1,354,940
–
–
–
–
–
969,3312
–
850,0937
–
–
–
92,471
1,679,550
153,931 2,795,829
113,588 2,063,091
78,945 1,433,885
56,477 1,025,808
Sep-26
Mar-25
Mar-26
Mar-22
Mar-23
Mar-24
Mar-25
Mar-26
Sep-28
Mar-27
Mar-28
Mar-24
Mar-25
Mar-26
Mar-27
Mar-28
1 Following the appointment of Robyn Grew as CEO an award under the LTIP was granted in September 2023 for the three-year performance period commencing on 1 January 2023 and ending on
31 December 2025. The monetary value of the awards was $3,300,000 representing 300% of base salary converted into a number of shares using the GBP/USD exchange rates of £1 = $1.2617
and a share price of £2.1120, being the market value on the immediately preceding dealing day to grant. The award has been granted as a conditional award of shares and will vest, to the extent the
performance conditions have been achieved, three years later and will then be subject to a further two-year holding period, under the LTIP rules. The award attracts dividend accruals from grant
date to the end of the two-year holding period for vested shares.
2 Awards under the LTIP were granted in March for the three-year performance period commencing on 1 January 2023 and ending on 31 December 2025. The monetary value of these awards was
$3,300,000 for Luke Ellis and $1,962,000 for Antoine Forterre, each representing 300% of base salary converted into a number of shares using the GBP/USD exchange rates of £1 = $1.1912 and a
share price of £2.8580, being the market value on the immediately preceding dealing day to grant. The awards have been granted as conditional awards of shares and will vest, to the extent the
performance conditions have been achieved, three years later and will then be subject to a further two-year holding period, under the LTIP rules. These awards attract dividend accruals from grant
date to the end of the two-year holding period for vested shares.
3 These awards will be pro-rated for time from the beginning of the performance period until 31 May 2024, this being the end of the month in which Luke Ellis retires.
4 On 19 May 2023, dividend accruals of 49,877 and 315,043 shares were added to Antoine Forterre’s and Luke Ellis’ awards respectively based on a sterling dividend of 8.07 pence. On 22 September
2023, dividend accruals of 25,331, 28,556 and 180,369 shares were added to Robyn Grew’s, Antoine Forterre’s and Luke Ellis’ awards respectively based on a sterling dividend of 4.42 pence.
5 Awards vest at 0% at threshold, 50% at target and 100% at maximum, with straight-line vesting between these points.
6 Vested shares are delivered to participants at the end of a two-year holding period.
7 The figure comprises shares that lapsed during the year due to the Committee applying a 10.6% reduction to the number of shares initially awarded and shares that lapsed due to performance
metric outcomes.
Conditional share awards under the Deferred Executive Incentive Plan (DEIP) – subject only to service conditions (audited) –
Table R14
Former executive director
Luke Ellis
Date of grant1
1 January
2023
Vested during
the year
Lapsed during
the year
Dividends
accruing
31 December
2023
Date
vested
Mar-18
422,606
422,606
–
–
–
Mar-23
1 No further awards are to be granted under the DEIP following the adoption of the LTIP.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 118
Directors’ Remuneration report continued
3. Remuneration outcomes in 2023 continued
Options granted under the Man Group Deferred Share Plans – subject only to service conditions (audited) – Table R15
Executive directors
Robyn Grew1
Antoine Forterre
Former executive director
Luke Ellis
Date of grant
Deferred Share Plan (DSP)
Mar-212
Mar-223
Mar-234
Mar-235
Deferred Share Plan (DSP)
Mar-226,7
Mar-238
Deferred Share Plan (DSP)
Mar-20
Mar-219
Mar-226
Mar-2310
1 January
2023
Granted during
the year
Exercised/
vested during
the year
Lapsed during
the year
Dividends
accruing11
31 December
2023
Exercised/
vested date
128,653
496,766
913,860
228,462
–
–
–
–
–
–
–
–
454,285
–
–
281,106
151,428
–
117,048
161,136
278,042
–
–
–
–
252,704
117,048
80,567
92,680
–
–
–
–
–
–
–
–
–
–
–
2,631
10,160
18,693
4,671
131,284
506,926
932,553
233,133
–
–
–
–
17,644
16,374
320,501
297,480
Mar-23
–
–
4,694
10,800
14,721
–
85,263
196,162
267,425
Mar-23
Mar-23
Mar-23
–
1 Robyn Grew was appointed to the Board on 1 September 2023. The opening balance of options for Robyn Grew under the DSP, all of which relate to her employment before becoming a director,
are shown as at 1 September 2023. Shares awarded under the DSP are delivered automatically on the vesting date.
2 Award vests in March 2024 with shares delivered automatically upon vesting.
3 Award vests in two equal instalments in March 2024 and March 2025 with shares delivered automatically upon vesting.
4 Award vests in a single instalment in March 2028 with shares delivered automatically upon vesting.
5 Awards vests in three equal instalments in March 2024, March 2025 and March 2026 with shares delivered automatically upon vesting.
6 Award vests in two equal instalments in March 2024 and March 2025.
7 A proportion of the award is attributable to the period prior to Antoine Forterre's appointment as an executive director.
8 Award vests in three equal instalments in March 2024, March 2025 and March 2026. Options may not be exercised for at least six months following vesting.
9 Award vests in March 2024.
10 Award vests in three equal instalments in March 2024, March 2025 and March 2026.
11 On 19 May 2023, dividend accruals of 21,633 and 19,216 shares were added to Antoine Forterre’s and Luke Ellis’ awards respectively based on a sterling dividend of 8.07 pence. On 22 September
2023, dividend accruals of 36,155, 12,385 and 10,999 shares were added to Robyn Grew’s, Antoine Forterre’s and Luke Ellis’ awards respectively based on a sterling dividend of 4.42 pence.
Options granted under the Man Group Sharesave Scheme (audited) – Table R16
Date of grant
1 January
2023
Granted
during the year
Exercised
during the
period
Lapsed
during the year
31 December
2023
Option price
Earliest
exercise date
Latest
exercise date
Number of options
Executive director
Robyn Grew
Antoine Forterre
Former executive director
Luke Ellis
–
Sep-22
–
14,925
Sep-19
11,811
–
–
–
–
–
–
–
–
–
–
14,925
–
201.0p
–
Oct-27
–
Mar-28
11,811
127.0p
Oct-24
Mar-25
3.14 Shareholder voting and engagement
At the AGMs held on 6 May 2022 and 5 May 2023, votes cast by proxy and at the meeting in respect of directors’ remuneration were as follows:
Table R17
Resolution
Approve the Directors’ Remuneration Policy (May 2022)
Approve the annual report on remuneration (May 2023)
Votes for
939,700,962
785,623,944
% for
91.37
92.89
Votes against
88,798,755
60,091,556
% against
8.63
7.11
Total votes cast
1,028,499,717
845,715,500
Votes withheld
(abstentions)
698,307
29,255,421
Man Group plc | Annual Report 2023
Governance 4. Implementation of Directors’ Remuneration Policy for 2024
119
4.1 Base salary
Salaries are reviewed annually taking into account market benchmarks for executives of comparable status, responsibility and skill.
Base salary of executive directors – Table R18
Base salary at
1 January 2023
1 January 2024
4.2 Annual bonus for 2024
Robyn Grew
n/a
$1,100,000
Antoine
Forterre
$654,000
$680,000
The following table shows the performance metrics and weightings for the annual bonus in 2024 which remain unchanged from 2023. The
Committee considers that the disclosure of detailed performance targets in advance for 2024 would be commercially sensitive and they are not,
therefore, disclosed here.
Table R19
Metrics
Relative net flows, growth %
Core management fee EPS
Core total EPS
Strategic and personal
ESG objectives
Total
Weighting %
30%
20%
20%
15%
15%
100%
4.3 Long-Term Incentive Plan for 2024
The threshold to maximum ranges for the Man Group plc LTIP are set out in the table below. Awards vest at 0% at threshold, 50% at target and
100% at maximum, with straight-line vesting between these points. Vested awards are subject to a two-year holding period.
Table R20
Metrics
Relative investment performance
Relative TSR vs FTSE 250
3-year cumulative core management fee EPS, cents
3-year cumulative core EPS, cents
Relative cumulative relative net flows
ESG scorecard1
Total
Threshold
0.0%
Median
61.0¢
81.0¢
0.0%
Target
3.0%
Mid-point
between
median
and upper
quartile
69.0¢
104.0¢
9.0%
Maximum
6.0%
Weighting %
20%
Upper
quartile
77.0¢
127.0¢
18.0%
20%
10%
30%
10%
10%
100%
1 The ESG scorecard metric includes the following equally weighted objectives: to increase the number of women in senior positions (at 31 December 2026: threshold 33%, target 34% and maximum
35%), to reduce Scope 1 to 3 emissions per FTE (cumulative emissions from 1 January 2024 to 31 December 2026: threshold 9.5 tCO2e, target 8.7 tCO2e and maximum 7.8 tC02e) and to grow the
percentage of ESG-integrated AUM excluding market beta (cumulative growth from 1 January 2024 to 31 December 2026: threshold 11%, target 16% and maximum 21%).
4.4 Non-executive directors’ Remuneration Policy for 2024
During 2023, the Remuneration Committee approved an increase in the fees for the non-executive directors from £75,000 to £80,000 and an
increase in the Senior Independent Director (SID) fee from £15,000 to £25,000. This is the first increase in the non-executive director and SID
fees since January 2020.
Non-executive directors’ fees for 2024 – Table R21
Position (all figures in GBP)
Chair of the Board1
Board fee2
Senior Independent Director
Audit and Risk Committee Chair
Other Audit and Risk Committee members
Employee engagement NEDs
Remuneration Committee Chair
Other Remuneration Committee members
1 Chair does not receive Board or Committee membership fees.
2
Includes Nomination and Governance Committee membership.
Man Group plc | Annual Report 2023
2024
385,000
80,000
25,000
35,000
15,000
7,500
30,000
10,000
2023
385,000
75,000
15,000
35,000
15,000
7,500
30,000
10,000
% change
–
6.7%
66.7%
–
–
–
–
–
Strategic report | Governance | Financial statements | Shareholder information 120
Directors’ Remuneration report continued
4. Implementation of Directors’ Remuneration Policy for 2024 continued
4.5 Illustrative pay for performance scenarios
The chart below provides an illustration of some of the potential reward opportunities for executive directors in respect of the operation of the
Directors’ Remuneration Policy in 2024 showing the potential split between the different elements of remuneration under different performance
scenarios: ‘minimum’, ‘mid-point’, ‘maximum’ and ‘maximum with 50% share price appreciation’.
Illustrative pay for performance scenarios ($’000)
Robyn Grew
CEO
Minimum
Mid-point
Maximum
Maximum with 50%
share price appreciation
Antoine Forterre
CFO
Minimum
Mid-point
Maximum
Maximum with 50%
share price appreciation
Salary, pension and benefits
Annual bonus
LTIP
100%
$1,290
28%
16%
14%
36%
36%
$4,590
42%
35%
42%
$7,890
35%
17%
$9,540
100%
$795
28%
36%
36%
$2,835
16%
13%
42%
35%
42%
$4,875
35%
17%
$5,895
Assumptions used:
• The minimum scenario reflects base salary, pension (of 14% of salary) and benefits as disclosed in the single figure of total remuneration
(i.e. fixed remuneration), which are the only elements of the executive directors’ remuneration packages not linked to performance during the
year under review.
• The ‘mid-point’ scenario reflects fixed remuneration as above, plus a target payout of 50% of the maximum annual bonus and 50% vesting
for the LTIP.
• The ‘maximum’ scenario reflects fixed remuneration as above, plus full payout of both the annual bonus and LTIP.
• The minimum, mid-point and maximum illustrations are based on initial award value and do not, therefore, reflect potential share price
appreciation or any dividend equivalent received over the vesting/deferral periods.
• The ‘maximum with 50% share price appreciation’ shows the impact of a 50% increase in the value of the LTIP share award from grant; it
does not reflect any potential dividends received over the vesting period.
• Annual bonus includes both the cash bonus and the amount of the bonus deferred.
Man Group plc | Annual Report 2023
Governance 5. Remuneration Committee
121
5.1 Membership and attendance
The Committee met seven times during 2023 with attendance by members as indicated on page 71. Laurie Fitch joined the Committee
on 25 August 2023 and became Committee Chair on 1 October 2023, at which time Anne Wade stepped down as Committee Chair but
remained as a member. Ceci Kurzman joined the Committee on 1 October 2023. Jackie Hunt, Kate Barker and John Cryan stepped down
from the Committee on 27 March, 1 April and 30 September 2023 respectively. All other members held office throughout the year. In addition
to the meetings, certain urgent proposals relating to the retention of awards by good leavers and remuneration arrangements for certain
individuals were circulated and agreed by email between meetings.
Committee meetings are regularly attended by the CEO and, where appropriate, by the CFO at the invitation of the Chair. The Committee
is supported by the Senior Reward Executive, who routinely attends meetings. Members of the Legal, Compliance, People and Executive
Incentive Plans teams attend meetings when required to provide information and advice on remuneration, regulatory and executive incentive
plan matters. The Company Secretary acts as Secretary to the Committee.
At the end of each meeting there is an opportunity for private discussion between Committee members without the presence of executive
directors and management if required.
Roles and responsibilities
The Committee’s principal responsibilities are to:
• Determine the Company’s remuneration philosophy and the principles and structure of its Remuneration Policy, ensuring that these support
and promote the long-term sustainable success of the Company and are in line with the Company’s purpose and values, business strategy,
objectives, risk appetite and long-term interests and comply with all regulatory requirements and promote long-term shareholder and other
stakeholder interests.
• Recommend to the Board the specific Remuneration Policy for the executive directors, for approval by shareholders, and make remuneration
decisions within that approved policy.
• Approve the total annual compensation for individual executive directors based on their achievement against objectives set by the Committee
and Board at the start of the year for the short-term annual bonus and at the start of the relevant performance period for the LTIP.
• Recommend to the Board the remuneration of the Board Chair.
• Approve the total annual compensation for Executive Committee members, the Company Secretary and Remuneration Code staff.
• Review and consider shareholder and proxy voting agencies feedback and agree the approach to ongoing engagement.
Decision-making process
The Committee’s decision-making process takes account of legislation, regulation, corporate governance standards, guidance issued by
regulators, shareholders and shareholder representative bodies. As covered in section 5.2, the Committee has independent external advisers
and reviews their objectivity and independence annually. To avoid conflicts of interest, no Committee member or attendee is present when
matters relating to his or her own remuneration are discussed. Full terms of reference for the Committee, which are reviewed on an annual basis
and submitted to the Board for approval, are available on the Company’s website: www.man.com/corporate-governance.
In compliance with the UK Corporate Governance Code (2018) (the Code), we have set out below how the Committee addresses the following
factors:
Risk
Inappropriate risk-taking is avoided and good alignment with shareholders is achieved through a number of mechanisms including significant
bonus deferral into shares and funds, a three-year performance period for the Long-Term Incentive Plan (the LTIP) with a subsequent two-year
post-vesting holding period and shareholding requirements, including for two years after leaving the Board. Before any decisions about incentive
outcomes are made, the Audit and Risk Committee reports to the Committee on any specific matters indicating excessive risk-taking or lack of
regard for controls and procedures. Malus and clawback provisions apply to the incentives in a range of specified circumstances, as set out in
the table on page 104.
Predictability
The charts on page 120 illustrate the potential remuneration outcomes under a range of scenarios (including in the event of a 50% increase in
the share price). Each year a detailed review is undertaken in order to set stretching annual and three-year performance targets in the bonus and
LTIP respectively.
Proportionality
The link between strategic priorities and incentive metrics is set out in detail in the chart on page 101. The Committee considers wider employee
remuneration, holistic business performance and shareholder experience in determining the appropriate level of executive director remuneration.
Alignment to culture
The key principles that underpin our approach to remuneration (and which apply at all levels of the organisation) are:
• remuneration is structured to support corporate strategy and sound risk management;
• employees’ interests are aligned with shareholders and the bonus pool is drawn from profit;
• incentives are designed to encourage behaviour focused on longer-term strategic and sustainable performance; and
• our total remuneration is competitive in the talent markets from which we hire.
Simplicity
Incentive schemes are straightforward in their structure and operation with explicit links between strategic priorities, key performance indicators
and incentive metrics.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 122
Directors’ Remuneration report continued
5. Remuneration Committee continued
Clarity
A summary of the Remuneration Policy is clearly laid out in tabular form in the DRR on page 104 and the full policy is available on the Company’s
website: www.man.com/corporate-governance). Details of the operation of the Remuneration Policy have been explained to the wider
workforce, as set out in the Chair’s statement. The new UK Corporate Governance Code published in January 2024 will apply to Man Group in
the financial year beginning 1 January 2025. We are considering the changes in the new Code and the implications for Man’s Remuneration
Policy and will report on progress at the appropriate time.
5.2 Independent advisers
Following a formal tender process in July 2017, the Committee appointed PricewaterhouseCoopers (PwC) to provide it with advice on a range
of remuneration matters including the benchmarking of directors’ compensation in the asset management sector, trends in market practice
and regulatory disclosures. PwC also provide professional services in the ordinary course of business including tax and related advisory work
to parts of Man Group. There are processes in place to ensure the advice received by the Committee is independent of any support provided
to management. The Committee is satisfied on this basis that PwC are able to serve as an objective and independent remuneration adviser.
The total fees paid to PwC in relation to 2023 were £96,400 (excluding VAT). The Committee also received legal advice from Herbert Smith
Freehills LLP on compliance with legislation and regulations relating to remuneration matters.
5.3 Committee activities during 2023 and the early part of 2024
The summary below sets out the main issues considered and decisions made by the Committee in the period following the publication of the
2022 Directors’ Remuneration report up to the current date.
Non-Executive Director and Senior Independent Director fees
• Reviewed the fee level of the non-executive directors and the Senior Independent Director in the context of benchmarking of similar roles in
broadly equivalent-sized companies in the financial services sector, the FTSE 350 and of the demands of the role and approved that these
should be increased. See page 119 for further details.
Executive director compensation
• Established the threshold, target and maximum ranges to be achieved for the financial metrics and recommended to the Board for approval
the objectives to be delivered under the non-financial component of the annual bonus.
• Assessed the 2023 performance, against the financial and non-financial metrics of the annual bonus, of the CEO and CFO, and considered
whether any discretionary intervention was required to adjust the formulaic outcome; approved the total cash sum payable and the amount to
be deferred.
• Reviewed the level of achievement of each executive director in respect of their shareholding requirement and consequently determined that
the option to defer up to 50% of the bonus deferral amount into funds could be offered.
• Agreed the remuneration arrangements for Luke Ellis upon his retirement.
• Established the remuneration arrangements for Robyn Grew ahead of her appointment as CEO.
• Reviewed the available benchmarking for the CEO and CFO roles within the selected peer group, to provide the business context for all the
above reward decisions and approved an increase in the CFO’s salary. See page 103 for further details.
Shareholder engagement and reporting
• Reviewed shareholder voting and feedback on the 2023 AGM resolutions for the 2022 DRR, noting the substantial level of support.
• Reviewed the 2023 DRR taking account of best practice recommendations and institutional shareholder guidelines.
Compensation below Board level
• Reviewed, challenged and approved the 2023 bonus pool proposed by management in relation to the Company’s performance for the year.
• Approved bonus deferral policies for different groups of staff.
• Approved total compensation proposals for Executive Committee members, taking account of the CEO’s appraisal of their individual
performance for 2023 and their adherence to the Company’s business values.
• Approved the total compensation for individuals identified as Remuneration Code staff.
• Approved the total compensation for the Company Secretary.
• Retained oversight of the total compensation for staff earning over $1 million, taking account of the CEO’s appraisal of their performance for
2023 and reports from the Risk and Compliance functions on any related risk issues arising during the year.
• Reviewed the approach to wider workforce compensation, including by reference to gender and ethnicity metrics.
• Reviewed the ratio of CEO pay to the lower quartile, median and upper quartile remuneration paid to UK employees (see page 115).
Financial regulation and governance
• Reviewed ongoing regulatory developments on remuneration and their implications for the Company’s business.
• Reviewed the Company’s Financial Conduct Authority Remuneration Policy Statement and the Company’s Remuneration Policy.
• Approved the list of Remuneration Code staff for 2023.
Man Group plc | Annual Report 2023
Governance 123
5.4 2023 Committee evaluation
Committee members provided their feedback on the operation and effectiveness of the Committee during 2023. The topics covered included
progress on the priorities for 2024 and the conduct and outcomes of specific areas of Committee activity and focus during the year, including
the support and advice available to the Committee.
In the evaluation feedback, the Committee again acknowledged the quality of the advice provided by its advisers and the thorough and
professional papers delivered to the Committee to support its decision-making. It further acknowledged the strong start made by the new
Committee Chair, Laurie Fitch.
Following this process, certain key areas of focus were agreed for 2024:
• Deliver the 2023 DRR.
• Keep shareholder guidelines and corporate governance best practice under review to ensure the Committee is responding to any
developments in these areas.
• Further deepen the Committee’s understanding and consideration of compensation below the Board and build on the analysis of workforce
remuneration by reference to gender and other diversity metrics; ensure this is considered in discussions about the level and appropriateness
of executive director compensation and continue to engage with workforce.
• Review Directors’ Remuneration Policy and engage with shareholders on any potential changes.
5.5 Benchmarking and peer groups
Benchmarking is one of several factors considered by the Committee in its deliberations on remuneration as it is important that the Committee
understands the level of remuneration paid by Man Group’s competitors for similar positions and which they may be offering in the marketplace.
Many of Man Group’s senior staff are geographically mobile, particularly between London and New York, and an explicit consideration of
remuneration levels in both geographies is highly relevant to enable us to continue to recruit and retain global talent. Man Group is one of the few
listed companies anywhere in the world that operates in the liquid alternative investment industry. Most businesses in this industry are privately
owned and systematic remuneration data is not publicly available. Man Group does compete for talent against these businesses and staff do
move between Man Group and these private companies so, as part of its understanding of the broader business context, the Committee will
continue to review available information on privately owned peers as well as the direct information about remuneration in those privately held
companies that Man Group has acquired.
UK listed peer group
US listed peer group
3i
Abrdn
Ashmore
Close Brothers
Intermediate Capital Group
Jupiter
M&G
Ninety-One
Schroders
TP ICAP
Affiliated Managers
Apollo Global Management
Ares
Artisan Partners
BlackRock
Blackstone
Carlyle
Federated Hermes
Janus Henderson
KKR
Unless otherwise stated, all information in the DRR is unaudited. As the Company is Jersey-incorporated, it is not subject to the provisions of the
UK Companies Act 2006 and therefore information on the directors’ remuneration in the DRR is included on a voluntary basis. The disclosures
contained in the DRR relate to the Company’s statutory directors (as set out on pages 72 and 73 of the Annual Report) only. In respect of those
directors, the disclosures are prepared in line with the provisions of the UK Companies Act 2006.
The information in the DRR should be read in conjunction with Man Group’s APMs, outlined on pages 175 to 179.
For and on behalf of the Board
Laurie Fitch
Chair of the Remuneration Committee
28 February 2024
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 124
Directors’ report
The Directors present their report,
together with the audited consolidated
financial statements, for the year ended
31 December 2023.
Man Group plc is incorporated as a public company limited by
shares and is registered in Jersey with the registered number 127570.
The Company’s registered office is 22 Grenville Street, St Helier,
Jersey JE4 8PX.
Although the Company is subject to Companies (Jersey) Law 1991
(Jersey law), the following report also includes certain disclosures
required for a UK incorporated company under the UK Companies
Act 2006 in the interests of good governance.
The Directors’ report comprises pages 124 and 125 and the other
sections and pages of the Annual Report and financial statements
cross-referenced below which are incorporated by reference. The
Corporate Governance statement comprises pages 68 to 126. In line
with common practice, certain disclosures normally included in the
Directors’ report have instead been integrated into the Strategic report
(pages 2 to 67) and the financial statements:
Disclosure
Business relationships, stakeholders
and their effect on decisions
Directors’ responsibility statement
and statement of disclosure to auditor
Directors’ share interests
Location
Strategic report
Governance report
Directors’ responsibility
statement
Directors’ Remuneration
report
Strategic report
Governance report
Notes 8 and 14
Note 13
Employment policies including
disability and equal opportunities and
employee involvement
Financial risk management
Financial instruments
Future developments in the business Strategic report
Going concern disclosure
Greenhouse gas emissions, energy
consumption and energy efficiency
Internal control and risk management Strategic report
Research and development activities Strategic report
Purchase of own shares
Subsidiary undertakings listing
Note 2
Strategic report
Note 25
Note 31
Page(s)
10–11
78–83
126
116–117
36–42
65–67
80
147, 153
152
12–19
142
46–61
28–35
14–19
169
172
Listing Rule 9.8.4R disclosure
The Employee Trust waived its rights to receive dividends on shares
held by them. Information regarding long-term incentive schemes is
contained within the Directors’ Remuneration report on pages 100 to
123. There are no further disclosures relevant to Listing Rule 9.8.4R.
Directors
Details of the directors, with their biographies, can be found on pages
72 to 73. The following director changes occurred during 2023:
Jacqueline Hunt
Stepped down from the Board on 27 March 2023
Dame Katharine Barker Stepped down from the Board on 1 April 2023
Luke Ellis
Stepped down from the Board on 31 August 2023
John Cryan
Stepped down from the Board on 30 September 2023
Laurie Fitch
Robyn Grew
Appointed to the Board on 25 August 2023
Appointed to the Board on 1 September 2023
Man Group plc | Annual Report 2023
Alberto Musalem, who has served as a non-executive director
since 1 November 2022, will be stepping down from the Board
on 29 February 2024.
Powers of directors
The Board is responsible for the management of the business of the
Company and may exercise all the powers of the Company subject
to the provisions of relevant statutes and the Company’s Articles of
Association (the Articles). A copy of the Articles is available on the
Company’s website and by request from the registered office of the
Company. The Articles may be amended by a special resolution of
the shareholders.
Appointment, retirement and replacement of directors
The appointment, retirement and replacement of directors are
governed by the Articles, the 2018 UK Corporate Governance
Code and Jersey law. Under the Articles, the Board has the power to
appoint further directors during the year, but any director so appointed
must stand for reappointment at the next Annual General Meeting
(AGM). In accordance with the Articles, one-third of the Board must
retire by rotation at each AGM and may stand for reappointment.
In practice, and in accordance with the UK Corporate Governance
Code, all Board members retire and offer themselves for
reappointment at each AGM.
The Articles give each director the power to appoint any person
to be their alternate, such appointment being subject to Board
approval where the proposed alternate is not an existing director
of the Company.
Directors’ indemnities and insurance cover
The Company has maintained third-party indemnity provisions for
the benefit of the directors of Man Group plc and its subsidiaries,
and these remain in force at the date of this report. New indemnities
are granted by the relevant company to new directors on their
appointment and cover, to the extent permitted by the UK Companies
Act 2006 and any local jurisdictional requirements, any third-party
liabilities which they may incur as a result of their service on a Board
within the Group. The Company arranges directors’ and officers’
liability insurance to cover certain liabilities and defence costs
which an indemnity does not meet. The Company arranges
separate pension trustee liability insurance to cover certain liabilities
and defence costs of the pension trustees. Neither the indemnity nor
the insurance policies provide any protection in the event of a director
or trustee being found to have acted fraudulently or dishonestly in
respect of the Company or its subsidiaries.
Annual General Meeting (AGM)
The 2024 AGM of Man Group plc will be held at Riverbank House,
2 Swan Lane, London EC4R 3AD on Thursday 9 May 2024 at 10am.
Shares
Share capital
The issued share capital as at 28 February 2024 consisted of
1,313,349,959 ordinary shares of 33/7 US cents per share. Details
of movements in issued share capital, together with the rights and
obligations attaching to the Company’s shares, are set out in Note 25
to the financial statements and in the Company’s Articles.
Authority to purchase own shares
At the 2023 AGM, the Company was authorised by its shareholders
to purchase up to a maximum of 124,190,442 of its ordinary shares.
Details of shares purchased under this authority by the Company
during the year are detailed in Note 25 to the financial statements.
Governance
125
Treasury shares
Ordinary shares held by the Company in treasury do not carry voting
rights. If the treasury shares are subsequently sold or transferred for
the purposes of satisfying an employee share scheme as permitted
by the Jersey (Companies) Law 1991, then the shares, at this point,
will again carry their full voting rights. Further details on treasury
shares can be found in Note 25 to the financial statements.
Share transfer restrictions
In accordance with the current Directors’ Remuneration Policy, the
CEO is required to hold shares in Man Group plc representing at
least 300% of salary and other executive directors are required to
hold shares in Man Group plc representing at least 200% of salary.
Directors are required to retain their shareholdings in full for two
years after departure from Man Group plc or, where appropriate, in
circumstances where directors have stepped down from the Board
but remain with the Company; this will be at the lower of either their
required or actual shareholding on leaving. Further information can be
found in the Directors’ Remuneration report on pages 100 to 123.
The Board may decline to register a transfer of any share which
is not a fully paid share. In addition, registration of a transfer of an
uncertificated share may be refused in the circumstances set out in
The Companies (Uncertificated Securities) (Jersey) Order 1999 and
where the number of joint holders exceeds four.
Change of control
The Company is not party to any significant agreements that
take effect, alter or terminate upon a change of control following
a takeover bid except for the Company’s $800 million revolving
credit facility dated 19 December 2023 which could, under specific
circumstances, become repayable following a relevant change of
control. The Company’s employee share and fund product incentive
schemes contain provisions whereby, upon a change of control of
the Company, outstanding options and awards will vest and become
exercisable, subject to any pro-rating that may be applicable. If a
change of control of the Company relates to an internal reorganisation,
the Board may determine, with the consent of the new controlling
company, that in the case of share awards the outstanding options
and awards will not vest and will be automatically surrendered in
consideration for the grant of new equivalent awards or options in the
new controlling company and that fund product awards will not vest
but will continue to subsist.
Independent auditor
The Company’s auditor, Deloitte, has indicated its willingness to
continue in office and a resolution to reappoint Deloitte as auditor of
the Company will be proposed at the 2024 AGM.
Political donations
The Company’s policy is not to make any donations or contributions
to political parties or organisations and no such payments were made
during the year.
Approved by the Directors and signed on behalf of the Board.
Elizabeth Woods
Company Secretary
28 February 2024
Substantial interests
As at 31 December 2023, the Company had been notified of the
following voting interests in the ordinary share capital of the Company
in accordance with DTR 5 of the FCA’s Disclosure Guidance and
Transparency Rules (DTRs). As a non-UK incorporated issuer, a
substantial interest is deemed to be 5% or greater. Percentages are
shown as notified, calculated with reference to the Company’s latest
total voting rights announcement prior to the date of the movement
triggering the notification.
It should be noted that these holdings are likely to have changed since
the Company was notified, however notification of any change is not
required until the next notifiable threshold is crossed.
Shareholder
JPMorgan Asset
Management Holdings, Inc.
BlackRock, Inc.
Silchester International
Investors LLP
Number of voting
rights notified to
the Company
Percentage of
issued share
capital Date of notification
6 January
Below 5% Below 5%
2023
Below 5% Below 5% 13 June 2023
11 December
2023
5.02%
60,389,137
No changes to the above were disclosed to the Company in
accordance with DTR 5 during the period 11 December 2023 to
28 February 2024 inclusive, being the latest practicable date prior to
the publication of this report.
Information provided to the Company under the DTRs is publicly
available via the regulatory information service and on the Company’s
website at https://www.man.com/investor-relations.
Dividend information
The directors recommend a final dividend of 10.7 cents per share
in respect of the year ended 31 December 2023.
Payment of this dividend is subject to approval at the Company’s
2024 AGM.
The Company offers a Dividend Reinvestment Plan (DRIP),
where dividends can be reinvested in further Man Group plc shares.
Further details on the proposed dividend payment, together with the
Company’s dividend policy, dividend payment methods and the DRIP,
can be found in the Shareholder information section on pages 180
to 181.
Restriction on voting rights
Employee Trust and share awards
Man Group operates share incentive arrangements for qualifying
staff. Where vesting conditions are met, awards granted under these
arrangements are settled in Company shares. In order to assist in
hedging Man Group’s exposure to such awards, the Company
has established the Employee Trust, which assumes the Company’s
obligation to deliver shares to employees on vesting. To enable the
Employee Trust to meet these obligations, Man Group provides
funds by way of direct contributions or loans. The Employee Trust
has independent trustees and its assets are held separately from
those of Man Group. However, given its nature as a structured entity
under IFRS, it is consolidated into the Group financial statements.
For accounting purposes, the shares held by the Employee Trust are
treated as though they were treasury shares. These shares remain,
however, in issue as trust assets. Under the Employee Trust deed, the
trustees have discretion to vote, or abstain from voting, on resolutions
put to shareholders.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 126
Directors’ responsibility statement
The Directors are responsible for
preparing the Annual Report and the
financial statements in accordance with
applicable law and regulations.
The Companies (Jersey) Law 1991 requires the directors to
prepare financial statements for each financial year. Under that law
the directors have elected to prepare the financial statements in
accordance with applicable law and International Financial Reporting
Standards (IFRSs) as adopted by the United Kingdom. The financial
statements are required by law to give a true and fair view of the state
of affairs of the Company and of the profit or loss of the Company for
that period.
In preparing the Group financial statements, International Accounting
Standard 1 requires that directors:
• properly select and apply accounting policies;
• present information, including accounting policies, in a
manner that provides relevant, reliable, comparable and
understandable information;
• provide additional disclosures when compliance with the specific
requirements in IFRSs are insufficient to enable users to understand
the impact of particular transactions, other events and conditions
on the entity’s financial position and financial performance; and
• make an assessment of the Company’s ability to continue as a
going concern.
The directors are responsible for keeping proper accounting records
that disclose with reasonable accuracy at any time the financial
position of the Company and enable them to ensure that the financial
statements comply with the Companies (Jersey) Law 1991. They are
also responsible for safeguarding the assets of the Company and
hence for taking reasonable steps for the prevention and detection
of fraud and other irregularities.
The directors are responsible for the maintenance and integrity of
the corporate and financial information included on the Company’s
website. Legislation in Jersey, Channel Islands governing the
preparation and dissemination of financial statements may differ
from legislation in other jurisdictions.
Each of the directors as at 31 December 2023, whose names and
functions are on pages 72 to 73, confirm that, to the best of each
person’s knowledge and belief:
• the financial statements, prepared in accordance with the relevant
financial reporting framework, give a true and fair view of the assets,
liabilities, financial position and profit or loss of the Company and
the undertakings included in the consolidation taken as a whole;
• the Strategic report includes a fair review of the development and
performance of the business and the position of the Company and
the undertakings included in the consolidation taken as a whole,
together with a description of the principal risks and uncertainties
that they face;
• the Annual Report and financial statements, taken as a whole,
are fair, balanced and understandable and provide the information
necessary for shareholders to assess the Company’s and Group’s
position, performance, business model and strategy; and
• there is no relevant audit information of which the Group’s auditor
is unaware, and that they have taken all steps that they ought to
have taken as a director in order to make themselves aware of any
relevant audit information and to establish that Man Group’s auditor
is aware of that information.
Man Group plc | Annual Report 2023
Governance 127
128
138
138
139
140
141
142
142
143
143
144
144
145
146
147
148
149
149
150
152
153
154
155
157
159
161
162
163
163
164
167
169
170
170
170
170
171
172
174
175
Financial statements contents
Audited information
Independent auditor’s report
Group income statement
Group statement of comprehensive income
Group balance sheet
Group cash flow statement
Group statement of changes in equity
Notes to the Group financial statements
Note
Basis of preparation
Going concern
Judgemental areas and accounting estimates
Revenue
Costs
Finance expense and finance income
Current tax and tax expense
Cash, liquidity and borrowings
Reconciliation of statutory profit to cash
generated from operations
Fee and other receivables
Trade and other payables
Investments in fund products and
other investments
Fair value of financial assets and liabilities
Market risks and derivatives
Leasehold improvements and equipment
Leases
Business combinations
Goodwill and acquired intangibles
Other intangibles
Deferred tax
Provisions
Investments in associates
Pension
Share-based payment schemes
Share capital, Employee Trust, Treasury share
reserve and earnings per share (EPS)
Dividends
Geographical information
Related party transactions
Other matters
Unconsolidated structured entities
Group investments
Unaudited information
Five-year record
Alternative performance measures
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 128
Independent auditor’s report to the members of Man Group plc
Report on the audit of the
financial statements
1. Opinion
3. Summary of our audit approach
Key audit matter The key audit matters that we identified in the current
year were:
In our opinion the financial statements of Man Group plc (the
‘parent company’) and its subsidiaries (the ‘group’):
• give a true and fair view of the state of the group’s affairs as at
31 December 2023 and of the group’s profit for the year then
ended;
Materiality
• have been properly prepared in accordance with United Kingdom
adopted international accounting standards; and
• have been properly prepared in accordance with Companies
Scoping
(Jersey) Law 1991.
We have audited the financial statements which comprise:
• Accuracy of performance fees; and
• Accounting treatment of the acquisition of Varagon
Capital Partners L.P. (Varagon).
The materiality that we used for the group financial
statements was $19.8m (2022: $19.0m) which was
determined on the basis of 2% of management
and other fees, which is consistent with the basis
of determination used in the prior year.
We performed full scope audits of 16 (2022: 20)
components and audits of specified account balances
within a further 15 (2022: 10) components across 10
(2022: 10) geographic locations.
Together, this accounts for 99% (2022: 99%) of the
group’s revenue, 98% (2022: 98%) of the group’s
profit before tax and 99% (2022: 98%) of the group’s
total assets.
There were no significant changes in our approach.
However, there is a new key audit matter of the group’s
acquisition of Varagon, as further described below.
Significant
changes in our
approach
4. Conclusions relating to going concern
In auditing the financial statements, we have concluded that the
directors’ use of the going concern basis of accounting in the
preparation of the financial statements is appropriate.
Our evaluation of the directors’ assessment of the group’s ability to
continue to adopt the going concern basis of accounting included:
• Considering the available cash and cash equivalents balance at
year-end of $180m as disclosed in Note 8 and assessing how this is
forecast to fluctuate over the coming 12 months in line with
management’s forecasted performance. This analysis includes
assessing the amount of headroom in the forecasts considering
cash restrictions;
• Considering the available revolving credit facility of $800m as
disclosed in Note 8 and assessing the nature and terms of the
financing facilities available to Man Group;
• Assessing the impact of downside scenarios considered by
management, including whether the potential impact of climate
change was captured;
• Testing of the clerical accuracy and assessing the sophistication
of the model used to prepare the forecasts;
• Assessing the reasonableness of the assumptions used in the
forecasts and the historical accuracy of forecasts prepared by
management alongside the historical conversion of accounting
profits to cash in the business, including consideration of
macroeconomic conditions; and
• Assessing the appropriateness of the going concern disclosures by
comparing them to management’s assessment for consistency and
for compliance with the relevant reporting requirements.
Based on the work we have performed, we have not identified any
material uncertainties relating to events or conditions that, individually
or collectively, may cast significant doubt on Man Group’s ability to
continue as a going concern for a period of at least 12 months from
when the financial statements are authorised for issue.
• the group income statement;
• the group statement of comprehensive income;
• the group balance sheet;
• the group cash flow statement;
• the group statement of changes in equity; and
• the related notes 1 to 31.
The financial reporting framework that has been applied in their
preparation is applicable law and United Kingdom adopted
international accounting standards.
2. Basis for opinion
We conducted our audit in accordance with International Standards
on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities
under those standards are further described in the auditor’s
responsibilities for the audit of the financial statements section of
our report.
We are independent of Man Group in accordance with the ethical
requirements that are relevant to our audit of the financial statements
in the UK, including the Financial Reporting Council’s (the ‘FRC’s’)
Ethical Standard as applied to listed public interest entities, and we
have fulfilled our other ethical responsibilities in accordance with these
requirements. We confirm that we have not provided any non-audit
services prohibited by the FRC’s Ethical Standard to the group.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Man Group plc | Annual Report 2023
Financial statements 129
4. Conclusions relating to going concern continued
In relation to the reporting on how the group has applied the UK Corporate Governance Code, we have nothing material to add or draw
attention to in relation to the directors’ statement in the financial statements about whether the directors considered it appropriate to adopt the
going concern basis of accounting.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
5. Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the
current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we identified. These
matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the
efforts of the engagement team.
These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do
not provide a separate opinion on these matters.
5.1 Accuracy of performance fees
Key audit matter
description
At $178m (2022: $778m) performance fee revenue remains a material revenue balance, albeit reduced relative to the
exceptionally high levels in the prior year (as further explained in the Chief Financial Officer’s review on page 23).
The measurement of performance fee revenue requires the accurate implementation of methodologies as set out in
investment management agreements which are often bespoke for each client or fund.
Performance fees are calculated less frequently than management fees, usually once a year based on crystallisation
dates specified in agreements. Performance fee calculations are also manual and are more complicated than those for
management fees, increasing the relative risk of misstatement.
There is a fraud risk associated with the accuracy of performance fee revenue due to this balance’s importance to
stakeholders and link to long term incentives. Given the complexity of the calculations and related risk of misstatement,
accuracy of performance fees is deemed to be a key audit matter.
The accounting policy for performance fees is detailed in Note 4 to the financial statements.
Our procedures included:
Assessing related controls: We tested the relevant controls over the accuracy of performance fees. We further
obtained an understanding of the relevant controls at service organisations. We placed reliance on these controls as
part of our audit approach.
Tests of detail: We independently agreed a sample of calculation methodologies to investment management
agreements and source documentation, evaluated the calculation methodology and the accuracy of the inputs used
(such as fee methodology, fee rates, fee base, crystallisation dates, fund return and relevant benchmarks), assessed
the arithmetic accuracy of the underlying computation and challenged any judgements when interpreting governing
documents.
We assessed the reliability of source information obtained from third-party administrators by reference to the third-
party administrators’ controls reports and retrospective comparisons against audited financial statements of the funds,
where available. For amounts subsequently finalised and invoiced after the year-end, we assessed the amounts
invoiced by mid-February against the accrued amounts at the year-end.
Based on our work, we concluded that performance fees are appropriately recorded.
How the scope of our
audit responded to the
key audit matter
Key observations
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 130
Independent auditor’s report to the members of Man Group plc continued
5.2 Accounting treatment on acquisition of Varagon
Key audit matter
description
During the year, Man Group acquired a controlling interest in Varagon which was accounted for under IFRS 3
Business Combinations (IFRS 3) and led to the recognition of $22m of goodwill and $147m of acquired intangible
assets (page 90 and Note 17 to the financial statements).
The Varagon acquisition included a number of features which involved technically complex accounting analysis and/or
judgement, where significant audit time was required to work through the relevant contractual agreements and IFRS
requirements as follows:
Classification of the Rollover Sellers’ retained economic interest as a liability, or as a non-controlling
interest within equity: As described in Note 17, the Rollover Sellers, being certain sellers of Varagon who remain in
employment post-acquisition, retain their 27% economic interest in Varagon in the form of non-voting units in the
group’s holding company of Varagon, subject to certain conditions. The terms of these units, together with the related
transaction agreements, include embedded ‘put’ options which, if exercised, require the group to buy this remaining
economic interest at an amount up to fair market value. The economic interest is classified as a liability within trade and
other payables (Note 11), and not equity.
Treatment of payments to Rollover Sellers as remuneration: As described in Note 17, these put option
payments are forfeited (entirely or in part) if the relevant Rollover Seller does not complete a specified minimum
period of service. Economically, management considers these payments to be the consideration payable to the
Rollover Sellers for their ownership interests in Varagon. However, as the payments are forfeited if employment
terminates, they are required to be treated as employment-related expenses over the relevant post-acquisition service
periods (Note 5). Therefore, the consideration of $179m attributable to the acquisition of 100% of Varagon’s recognised
net assets (Note 17) includes no consideration in respect of the Rollover Sellers’ transfer of their 27% former interest in
Varagon. The Group has applied its Alternative Performance Measures in the current year to assist users in
understanding the Rollover Seller payments and the effect of the required accounting.
Incentive payments to Institutional Sellers: Certain institutional sellers of Varagon whose affiliates are also
counterparties to Investment Management Agreements (IMAs) with Varagon, are entitled to future cash payments if the
IMAs are extended in the future. Judgement is required (Note 3) as to whether these payments represent, in whole or
in part, deferred transaction consideration, or an IMA extension transaction on arm’s length terms.
Valuation of acquired intangible assets: In addition, management’s fair valuation of the acquired intangible assets
(with assistance from an external valuations expert) and the fair valuation of the potential future put payments to the
Rollover Sellers involved forward looking assumptions involving significant estimation uncertainty. These included:
significant assumptions regarding future growth; related underlying assumptions about client and key management
retention and attraction of new business; and appropriate risk adjustments and discount rates commensurate with the
high level of subjectivity and uncertainty involved in the forecast assumptions.
Accordingly, we identified the Varagon acquisition to be a key audit matter.
Man Group plc | Annual Report 2023
Financial statements 131
5.2 Accounting treatment on acquisition of Varagon continued
How the scope of our
audit responded to the
key audit matter
In responding to this key audit matter, we performed the following procedures:
Overall Procedures:
• Analysed management’s accounting papers on the acquisition, assessed the accounting treatment with assistance
from our relevant IFRS technical experts.
• Inspected the transaction documents to evaluate the appropriate accounting treatment based on the terms of
the transaction.
• Assessed whether the group’s disclosures were complete and appropriate, and read the group’s Alternative
Performance Measures to ensure they were presented consistently with our understanding of the transaction.
Classification of the Rollover Sellers’ retained economic interest as a liability, or as a non-controlling
interest within equity:
• Based on the accounting analysis above, we have assessed whether the units represent NCI or whether the put/call
option over them results in liability classification.
Treatment of payments to Rollover Sellers as remuneration:
• Reviewed the group’s calculation of the employment-related expense associated with the Rollover Sellers’
post-acquisition service, for consistency with the applicable accounting requirements.
• Challenged management’s assumptions for fair valuing the estimated future payments to the Rollover Sellers,
including the underlying revenue and profit forecasts, related risk adjustments and discount rates used.
• Recalculated the portion of this fair value recognised as employment-related expense for the year.
Incentive payments to Institutional Sellers:
• Assessed whether the payments represent an IMA extension transaction on arm’s length terms and not deferred
transaction consideration, by reference to internal pricing information for Varagon’s services and analogous services
across the group.
Valuation of acquired intangible assets:
• Assessed the competence, capability and objectivity of the group’s valuations expert and engaged Deloitte
valuation specialists to assist in evaluating the methodology and key assumptions used in the valuation of
acquired intangible assets.
• Challenged management’s revenue and profit forecasts and considered whether there was any
contradictory evidence.
• Performed overall cross checks based on earnings multiples and weighted average return on assets.
• Agreed data and material factual information, such as contract duration and consideration payments back to the
relevant documentation, such as the transaction documents and bank statements.
• Benchmarked discount rates against external market sources, and considered with risk adjustments included within
discount rates and expected value calculation were appropriate.
We concluded that the acquisition has been accounted for in accordance with applicable IFRS requirements, the
material valuation and other assumptions used were reasonable, and that the related disclosures including those in
Note 3, Note 5, Note 11 and Note 17 are appropriate.
Key observations
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 132
Independent auditor’s report to the members of Man Group plc continued
6. Our application of materiality
6.1. Materiality
We define materiality as the magnitude of misstatement in the financial statements that makes it probable that the economic decisions of a
reasonably knowledgeable person would be changed or influenced. We use materiality both in planning the scope of our audit work and in
evaluating the results of our work.
Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:
Materiality
Basis for
determining
materiality
Rationale for the
benchmark applied
Materiality ($m)
Management and
other fees $990.0m
$19.8m (2022: $19.0m)
2% of management and other fees (2022: 2% of management and other fees)
We have determined management and other fees to be an appropriate basis for determining materiality as it reflects current
year performance whilst being relatively stable compared with other benchmarks. We excluded performance fees from
our materiality benchmark to avoid the undue fluctuations in materiality that would arise from year-on-year variations in
performance fees, if total revenues or a profit measure were used instead.
Group materiality $19.8m
Component materiality range $9.8m to $0.2m
Audit & Risk Committee Reporting Threshold $0.99m
Management and other fees
Group materiality
Man Group plc | Annual Report 2023
Financial statements
6.2. Performance materiality
We set performance materiality at a level lower than materiality to
reduce the probability that, in aggregate, uncorrected and undetected
misstatements exceed the materiality for the financial statements as
a whole. Group performance materiality was set at 70% of group
materiality for the 2023 audit (2022: 70%).
When considering performance materiality we have considered our
past experience of the audit, and our accumulated understanding
of the group and its environment. In particular, we took into account
the reliability of the group’s internal controls over financial reporting
and that we were able to rely on controls for a number of business
processes. We also took into account the low number of corrected
and uncorrected misstatements identified in prior periods, and
allowed for a degree of unpredictability of the full year result as at
the time of planning our audit.
6.3. Error reporting threshold
We agreed with the Audit and Risk Committee that we would report to
the Committee all audit differences in excess of $990k (2022: $950k),
as well as differences below that threshold that, in our view, warranted
reporting on qualitative grounds. We also report to the Audit and Risk
Committee on disclosure matters that we identified when assessing
the overall presentation of the financial statements.
133
7. An overview of the scope of our audit
7.1. Identification and scoping of components
Man Group operates across ten geographical locations with
operations in Europe, North America, Asia and Australia. In
determining the scope of work to be performed on specific
components of the group, which are generally the group’s
subsidiaries, we considered both quantitative and qualitative
factors. Our quantitative assessment was primarily based on
each component’s profit before tax and revenue, though we
also considered the overall coverage obtained. Our assessment
of qualitative factors included consideration of current year events
and any significant risks applicable to the component.
Based on that assessment, which is broadly consistent with
the prior year, we performed full scope audits of 16 (2022: 20)
components across the UK, the US, Switzerland, Channel Islands,
Ireland, Hong Kong, Jersey and the Cayman Islands. A further 15
(2022: 10) components were subject to an audit of specified
account balances where the extent of our testing was based on our
assessment of the risks of material misstatement and materiality to the
group of those components. The decrease in the number of full scope
components reflects the exclusion from our scope of a number of
smaller components which no longer require a local statutory audit,
with minimal impact on our overall audit coverage as described below.
All other components were subject to analytical review procedures.
Books and records for most geographies are maintained by
Man Group’s finance team in London, and accordingly these
components were all audited by the group audit team. Local
finance teams maintain books and records for the US (New York)
and Switzerland, but with significant reliance on the finance function
in the UK. Accordingly, the group audit team led the audit of these
components with assistance from local audit staff as required. For
Varagon, we engaged our local audit team based in the US (Texas) to
assist with the audit of specified account balances, however, the audit
work related to the Varagon key audit matter as described above was
performed directly by the group audit team.
The scope of the work we performed represents all principal business
units and accounts for 99% (2022: 98%) of the group’s total assets,
99% (2022: 99%) of the group’s revenue and 98% (2022: 98%) of
the group’s profit before tax on an absolute basis. This coverage
also provides an appropriate basis of audit work to address the risks
of material misstatement identified above. Our audit work at the 31
(2022: 30) components was executed at levels of materiality applicable
to each individual component which were lower than group materiality
and ranged from $0.2m to $9.8m (2022: $0.3m to $9.3m).
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 134
Independent auditor’s report to the members of Man Group plc continued
Revenue
3
2
1. Full audit scope
2. Audit of Account
Balances
3. Analytical Review
at group level
92%
7%
1%
Profit before tax
2 3
1
1
1. Full audit scope
2. Audit of Account
Balances
3. Analytical Review
at group level
95%
3%
2%
Total assets
3
2
1. Full audit scope
2. Audit of Account
Balances
3. Analytical Review
at group level
78%
21%
1%
1
7.2 Our consideration of the control environment
Where relevant, we followed a combined approach of performing
substantive and controls testing. We took a controls reliance approach
over management and performance fees and the related balance
sheet receivables and accruals in all areas of the business except
private markets. We also tested relevant controls over distribution
costs, fixed compensation, asset servicing and investment in fund
product plans. Where we placed reliance on service organisation
reports specifically at administrators and transfer agents, we have
obtained an understanding of the controls over the service
organisation reports and tested any complementary controls
performed by the group.
We tested general IT controls with involvement of IT specialists
over the group’s financial reporting processes and the key IT systems
for management fees, performance fees, distribution costs and
compensation. In addition, we tested the manual relevant controls
which complement these where needed.
7.3 Our consideration of climate-related risks
In planning our audit, we considered the potential financial impacts
on the group and its financial statements of climate change and the
transition to a low carbon economy. We considered management’s
own assessment of the related risks and opportunities as described
on page 34, together with our cumulative knowledge and experience
of the group and the environment in which it operates. We assessed
management’s disclosures about critical judgements and key sources
of estimation uncertainty, including the potential impact of climate
change on those judgements and estimates, in Note 3 to the financial
statements. We assessed management’s going concern and viability
disclosures, and identified no significant impact of climate change on
those disclosures given the timeframes of those assessments. We
have considered whether information included in the climate related
disclosures in the Annual Report is consistent with our understanding
and knowledge of the business and the financial statements. Our
knowledge obtained in the audit is from attending meetings with key
management personnel responsible for climate change at the group,
reviewing the group’s risk register, reviewing board packs and meeting
minutes and evaluating any public announcements or initiatives to
which the group has committed.
7.4 Working with other auditors
As described in 7.1 above, all work was performed by the group
audit team with assistance from local staff in Switzerland, US and
Ireland in certain areas. Local staff were directed and supervised by
the group audit team, with regular calls to provide direction, discuss
progress and provide updates relevant to the group audit. For the US
Varagon component team and Ireland, the local work scope was
established by the group team in outbound audit referral instructions,
with inbound reporting on the outcome of the work supplemented
with regular calls throughout the audit and review of local workpapers
as considered appropriate.
Man Group plc | Annual Report 2023
Financial statements 135
10. Auditor’s responsibilities for the audit of the
financial statements
Our objectives are to obtain reasonable assurance about
whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or
error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial
statements is located on the FRC’s website at: www.frc.org.uk/
auditorsresponsibilities. This description forms part of our
auditor’s report.
8. Other information
The other information comprises the information included in the
Annual Report, other than the financial statements and our auditor’s
report thereon. The directors are responsible for the other information
contained within the Annual Report.
Our opinion on the financial statements does not cover the
other information and we do not express any form of assurance
conclusion thereon.
Our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with
the financial statements or our knowledge obtained in the course of
the audit, or otherwise appears to be materially misstated.
If we identify such material inconsistencies or apparent material
misstatements, we are required to determine whether this gives rise
to a material misstatement in the financial statements themselves. If,
based on the work we have performed, we conclude that there is a
material misstatement of this other information, we are required to
report that fact.
We have nothing to report in this regard.
9. Responsibilities of directors
As explained more fully in the directors’ responsibilities statement, the
directors are responsible for the preparation of the financial statements
and for being satisfied that they give a true and fair view, and for such
internal control as the directors determine is necessary to enable
the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible
for assessing the group’s ability to continue as a going concern,
disclosing as applicable, matters related to going concern and using
the going concern basis of accounting unless the directors either
intend to liquidate the group or to cease operations, or have no
realistic alternative but to do so.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 136
Independent auditor’s report to the members of Man Group plc continued
11.2. Audit response to risks identified
As a result of performing the above, we identified accuracy of
performance fees as a key audit matter related to the potential risk
of fraud. The key audit matters section of our report explains the
matter in more detail and also describes the specific procedures
we performed in response to that key audit matter. In addition to
the above, our procedures to respond to the risks identified
included the following:
• reviewing the financial statement disclosures and testing to
supporting documentation to assess compliance with provisions
of relevant laws and regulations described as having a direct effect
on the financial statements;
• enquiring of management, the Audit and Risk Committee and
in-house and external legal counsel concerning actual and
potential litigation and claims;
• performing analytical procedures to identify any unusual or
unexpected relationships that may indicate risks of material
misstatement due to fraud;
• reading minutes of meetings of the Audit and Risk Committee,
reviewing internal audit reports and reviewing correspondence
with HMRC, Financial Conduct Authority (FCA) and other regulators
globally; and
• in addressing the risk of fraud through management override of
controls, testing the appropriateness of journal entries and other
adjustments; assessing whether the judgements made in making
accounting estimates are indicative of a potential bias; and
evaluating the business rationale of any significant transactions
that are unusual or outside the normal course of business.
We also communicated relevant identified laws and regulations
and potential fraud risks to all engagement team members including
internal specialists and component audit teams, and remained alert
to any indications of fraud or non-compliance with laws and
regulations throughout the audit.
11. Extent to which the audit was considered capable
of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements
in respect of irregularities, including fraud. The extent to which our
procedures are capable of detecting irregularities, including fraud,
is detailed below
11.1. Identifying and assessing potential risks related
to irregularities
In identifying and assessing risks of material misstatement in respect
of irregularities, including fraud and non-compliance with laws and
regulations, we considered the following:
• the nature of the industry and sector, control environment and
business performance including the design of the group’s
remuneration policies, key drivers for executive directors’
remuneration, bonus levels and performance targets;
• results of our enquiries of management, internal audit and the Audit
and Risk Committee about their own identification and assessment
of the risks of irregularities including those that are specific to the
group’s sector;
• any matters we identified having obtained and reviewed the group’s
documentation of their policies and procedures relating to:
• identifying, evaluating and complying with laws and
regulations and whether they were aware of any instances
of non-compliance;
• detecting and responding to the risks of fraud and
whether they have knowledge of any actual, suspected
or alleged fraud;
• the internal controls established to mitigate risks of fraud
or non-compliance with laws and regulations;
• the matters discussed among the audit engagement team including
component audit teams and relevant internal specialists, including
tax, pensions, IT and industry specialists regarding how and where
fraud might occur in the financial statements and any potential
indicators of fraud.
As a result of these procedures, we considered the opportunities
and incentives that may exist within the organisation for fraud
and identified the greatest potential for fraud in the accuracy of
performance fees. In common with all audits under ISAs (UK), we are
also required to perform specific procedures to respond to the risk of
management override.
We also obtained an understanding of the legal and regulatory
framework that the group operates in, focusing on provisions of those
laws and regulations that had a direct effect on the determination of
material amounts and disclosures in the financial statements. The
key laws and regulations we considered in this context included
Companies (Jersey) Law 1991, Listing Rules and the Disclosure
Guidance and Transparency rules, pensions legislation and
tax legislation.
In addition, we considered provisions of other laws and regulations
that do not have a direct effect on the financial statements but
compliance with which may be fundamental to the group’s ability
to operate or to avoid a material penalty. These included the group’s
solvency requirements and matters regulated by the Financial
Conduct Authority (the group’s lead regulator).
Man Group plc | Annual Report 2023
Financial statements 137
Report on other legal and regulatory
requirements
12. Opinion on other matter prescribed by our
engagement letter
In our opinion the part of the directors’ remuneration report to be
audited has been properly prepared in accordance with the basis
described on page 123.
13. Corporate Governance Statement
Based on the work undertaken as part of our audit, we have
concluded that each of the following elements of the Corporate
Governance Statement is materially consistent with the financial
statements and our knowledge obtained during the audit:
• the directors’ statement with regards to the appropriateness of
adopting the going concern basis of accounting and any material
uncertainties identified set out on page 143;
• the directors’ explanation as to its assessment of the group’s
prospects, the period this assessment covers and why the period
is appropriate set out on page 35;
• the directors’ statement on fair, balanced and understandable set
out on page 126;
• the board’s confirmation that it has carried out a robust assessment
of the emerging and principal risks set out on page 28;
• the section of the Annual Report that describes the review of
effectiveness of risk management and internal control systems set
out on page 28; and
• the section describing the work of the Audit and Risk committee set
out on pages 88 to 95.
14. Matters on which we are required to report
by exception
14.1. Adequacy of explanations received and
accounting records
Under the Companies (Jersey) Law 1991 we are required to report to
you if, in our opinion:
• we have not received all the information and explanations we
require for our audit; or
• proper accounting records have not been kept by the parent
company or proper returns adequate for our audit have not been
received from branches not visited by us; or
• the financial statements are not in agreement with the accounting
records and returns.
We have nothing to report in respect of these matters.
15. Other matters
15.1 Auditor tenure
Following the recommendation of the Audit and Risk Committee,
we were appointed by the shareholders at the Annual General
Meeting on 9 May 2014 to audit the financial statements for the year
ending 31 December 2014 and subsequent financial periods. The
period of total uninterrupted engagement including previous renewals
and reappointments of the firm is 10 years, covering the years ending
31 December 2014 to 31 December 2023.
15.2 Consistency of the audit report with the additional report
to the Audit and Risk Committee
Our audit opinion is consistent with the additional report to the Audit
and Risk Committee we are required to provide in accordance with
ISAs (UK).
16. Use of our report
This report is made solely to the company’s members, as a body, in
accordance with Article 113A of the Companies (Jersey) Law, 1991.
Our audit work has been undertaken so that we might state to the
company’s members those matters we are required to state to them
in an auditor’s report and those matters we have expressly agreed to
report to them on in our engagement letter and for no other purpose.
To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the company and the company’s
members as a body, for our audit work, for this report, or for the
opinions we have formed.
As required by the FCA Disclosure Guidance and Transparency Rule
(DTR) 4.1.15R – DTR 4.1.18R, these financial statements will form part
of the Electronic Format Annual Financial Report filed on the National
Storage Mechanism of the FCA in accordance with DTR 4.1.15R –
DTR 4.1.18R. This auditor’s report provides no assurance over
whether the Electronic Format Annual Financial Report has been
prepared in compliance with DTR 4.1.15R – DTR 4.1.18R.
Bevan Whitehead, FCA (Senior Statutory Auditor)
For and on behalf of Deloitte LLP
Recognised Auditor
London, United Kingdom
28 February 2024
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 138
Financial statements
Group income statement
For the year to 31 December
Management and other fees
Performance fees
Revenue
Net income or gains on investments and other financial instruments
Third-party share of (gains)/losses relating to interests in consolidated funds
Rental income
Distribution costs
Net revenue
Asset servicing costs
Compensation costs
Other employment-related expenses
Other costs
Finance expense
Finance income
Gain on disposal of investment property – right-of-use lease assets
Amortisation and impairment of acquired intangibles
Share of post-tax loss of associates
Third-party share of post-tax profits
Statutory profit before tax
Tax expense
Statutory profit attributable to owners of the Company
Statutory earnings per share
Basic
Diluted
Group statement of comprehensive income
For the year to 31 December
Statutory profit attributable to owners of the Company
Other comprehensive (loss)/income:
Remeasurements of defined benefit pension plans
Deferred tax on pension plans
Items that will not be reclassified to profit or loss
Cash flow hedges:
Valuation gains taken to equity
Realised gains transferred to Group income statement
Net investment hedges
Foreign currency translation
Items that may be reclassified to profit or loss
Other comprehensive loss
`
Note
4
4
12.1
12.2
12.1,16.2
5
5
5.1
5.1
5.2
6
6
16.2
18
22
17
7
25
Note
23
2023
$m
990
178
1,168
76
(24)
6
(32)
1,194
(58)
(595)
(23)
(198)
(34)
13
12
(28)
(3)
(1)
279
(45)
234
2022
$m
954
778
1,732
7
14
5
(31)
1,727
(58)
(678)
–
(179)
(16)
5
–
(51)
(5)
–
745
(137)
608
19.9¢
19.4¢
47.2¢
45.8¢
2023
$m
234
(10)
2
(8)
14
(12)
1
3
6
(2)
2022
$m
608
(2)
(1)
(3)
6
(7)
4
(4)
(1)
(4)
Total comprehensive income attributable to owners of the Company
232
604
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
139
Group balance sheet
At 31 December
Assets
Cash and cash equivalents
Fee and other receivables
Investments in fund products and other investments
Investments in associates
Current tax assets
Finance lease receivable
Leasehold improvements and equipment
Leasehold property – right-of-use lease assets
Investment property – right-of-use lease assets
Investment property – consolidated fund entities
Other intangibles
Deferred tax assets
Pension asset
Goodwill and acquired intangibles
Total assets
Liabilities
Borrowings
Trade and other payables
Provisions
Current tax liabilities
CLO liabilities – consolidated funds
Third-party interest in consolidated funds
Third-party interest in other subsidiaries
Lease liability
Total liabilities
Net assets
Note
8
10
12
22
7
16.2
15
16.1
16.1
12.2
19
20
23
18
8
11
21
7
12.2
12.2
17
16.1
Equity
Capital and reserves attributable to owners of the Company
The financial statements were approved by the Board of Directors on 28 February 2024 and signed on its behalf by:
Robyn Grew
Chief Executive Officer
Antoine Forterre
Chief Financial Officer
2023
$m
2022
$m
276
551
2,279
11
15
67
53
112
17
30
54
128
12
776
4,381
140
736
16
3
1,036
554
1
283
2,769
457
570
1,209
14
–
–
53
92
71
34
50
105
22
627
3,304
–
942
14
37
–
359
–
253
1,605
1,612
1,699
1,612
1,699
Man Group plc | Annual Report 2023
140
Financial statements
Group cash flow statement
For the year to 31 December
Operating activities
Cash generated from operations
Interest paid
Payment of lease interest
Tax paid
Cash flows from operating activities
Investing activities
Interest received
Purchase of leasehold improvements and equipment
Purchase of investment property – right-of-use lease assets
Purchase of other intangibles
Acquisition of subsidiaries, net of cash acquired
Cash flows used in investing activities
Financing activities
Repayments of lease liability principal
Purchase of Man Group plc shares by the Employee Trust
Proceeds from sale of Treasury shares in respect of Sharesave
Share repurchase programmes (including costs)
Ordinary dividends paid to Company shareholders
Payment of upfront costs of revolving credit facility
Drawdown of borrowings
Cash flows used in financing activities
Net (decrease)/increase in cash and cash equivalents
Cash and cash equivalents at beginning of the year
Effect of foreign exchange movements
Cash and cash equivalents at end of the year
Less: restricted cash held by consolidated fund entities
Available cash and cash equivalents at end of the year
Note
9
16.1
7
15
16.1
25
26
8
8
8
8
2023
$m
470
(23)
(10)
(100)
337
12
(12)
–
(21)
(170)
(191)
(10)
(56)
4
(223)
(181)
(3)
140
(329)
(183)
457
2
276
(96)
180
2022
$m
878
(6)
(10)
(125)
737
5
(21)
(2)
(22)
–
(40)
(13)
(47)
2
(386)
(179)
–
–
(623)
74
387
(4)
457
(108)
349
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
Group statement of changes in equity
Note Share capital
Reorganisation
reserve
Profit
and loss
account
Man Group plc
shares held by
Employee
Trust
Treasury
shares
Cumulative
translation
adjustment
Other
reserves
$m
At 1 January 2022
Statutory profit
Other comprehensive loss
Total comprehensive income
Share-based payment charge
Current tax on share-based
payments
Deferred tax on share-based
payments
Purchase of Man Group plc
shares by the Employee Trust
Disposal of Man Group plc
shares by the Employee Trust
Share repurchases
Transfer to Treasury shares
Transfer from Treasury shares
Disposal of Treasury shares
for Sharesave
Cancellation of Treasury shares
Dividends paid
At 31 December 2022
Statutory profit
Other comprehensive
(loss)/income
Total comprehensive income
Share-based payment charge
Current tax on share-based
payments
Deferred tax on share-based
payments
Purchase of Man Group plc
shares by the Employee Trust
Disposal of Man Group plc
shares by the Employee Trust
Share repurchases
Transfer to Treasury shares
Transfer from Treasury shares
Disposal of Treasury shares
for Sharesave
Cancellation of Treasury shares
Dividends paid
Put option over non-controlling
interests in subsidiaries
At 31 December 2023
5.1
7
25
26
5.1
7
25
25
26
51
–
–
–
–
–
–
–
–
–
–
–
–
(5)
–
46
–
–
–
–
–
–
–
–
–
–
–
–
(1)
–
–
45
(1,688)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(1,688)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
3,477
608
(3)
605
45
4
(6)
–
(28)
(375)
386
(24)
–
(315)
(179)
3,590
234
(8)
226
40
5
1
–
(30)
(125)
223
(18)
–
(103)
(181)
(61)
–
–
–
–
–
–
(47)
28
–
–
–
–
–
–
(80)
–
–
–
–
–
–
(56)
30
–
–
–
–
–
–
–
(1,688)
(7)
3,621
–
(106)
(178)
–
–
–
–
–
–
–
–
–
(386)
22
2
315
–
(225)
–
–
–
–
–
–
–
–
–
(223)
15
4
103
–
–
(326)
141
Total
1,651
608
(4)
604
45
4
(6)
(47)
–
(375)
–
–
2
–
(179)
1,699
234
(2)
232
40
5
1
(56)
–
(125)
–
–
4
–
(181)
41
–
–
–
–
–
–
–
–
–
–
–
–
–
–
41
–
4
4
–
–
–
–
–
–
–
–
–
–
–
9
–
(1)
(1)
–
–
–
–
–
–
–
2
–
5
–
15
–
2
2
–
–
–
–
–
–
–
3
–
1
–
–
45
–
21
(7)
1,612
Under the Companies (Jersey) Law 1991, a company may make a distribution from any source other than the nominal capital account and capital
redemption reserve, included within other reserves. The Company has reserves available for distribution of $2.9 billion as at 31 December 2023
(2022: $1.8 billion).
Man Group plc | Annual Report 2023
142
Financial statements
Notes to the Group financial statements
1. Basis of preparation
Accounting
The audited consolidated financial information has been prepared in accordance with International Financial Reporting Standards (IFRSs) and
interpretations (IFRICs) as adopted by the United Kingdom. The consolidated financial statements are prepared on a going concern basis using the
historical cost convention, except for certain financial instruments that are measured at fair value and defined benefit pension plans. Our significant
accounting policies, which have been consistently applied in the current and prior years, are included in the relevant notes, except for those below
which relate to the consolidated financial statements as a whole.
Man Group plc (the Company) has taken advantage of the exemption provided in Article 105 (11) of the Companies (Jersey) Law 1991 and therefore
does not present its individual financial statements and related notes.
Consolidation
The consolidated group is the Company and its subsidiaries (together Man Group). The consolidated financial statements are presented in United
States dollars (USD), the Company’s functional currency, as the majority of our revenues, assets, liabilities and financing are denominated in USD.
Monetary assets and liabilities denominated in foreign currencies are translated at the spot rate on each balance sheet date. Non-monetary items
carried at fair value that are denominated in foreign currencies are translated at the rates prevailing at the date when the fair value was determined.
Non-monetary items that are measured at historical cost in a foreign currency are not retranslated. Transactions denominated in foreign currencies
are converted at the spot rate at the date of the transaction or, if appropriate, the average rate for the month in which the transaction occurs. The
resulting exchange differences are recognised in the Group income statement.
For consolidated entities that have a functional currency other than USD, the assets and liabilities are translated into USD at the spot rate on balance
sheet date. Income and expenses are translated at the average rate for the period in which the transactions occur. The resulting exchange
differences between these rates are recorded in other comprehensive income.
The consolidated financial information contained within these financial statements incorporates our results, cash flows and financial position for the
year to 31 December 2023 and includes our share of the results of any associates and joint ventures using the equity method of accounting.
Subsidiaries are entities we control (including certain structured entities, as defined by IFRS 12 ‘Disclosure of Interests in Other Entities’) and are
consolidated from the date on which control is transferred to us until the date that control ceases. Control exists when we have the power to direct
the relevant activities, exposure to significant variable returns and the ability to utilise power to affect those returns. All intercompany transactions and
balances are eliminated on consolidation. Although the Employee Trust has independent trustees and its assets are held separately, it is
consolidated into the Group financial statements given its nature as a structured entity which has the obligation to deliver deferred compensation
awards to our employees.
Business combinations
Man Group uses the acquisition method to recognise acquired businesses from the date on which we obtain control of the acquiree. The consideration
transferred in an acquisition is measured at the fair value of the assets transferred, including any contingent consideration, the liabilities incurred, and any
equity instruments issued. The fair value of the business acquired is measured at the fair value of the acquiree’s identifiable assets and liabilities at that
date. Goodwill is measured as the excess of the sum of the consideration transferred and the amount of any non-controlling interests in the acquiree
over the net of the amounts of the identifiable assets acquired and liabilities assumed at the acquisition date. Acquisition-related costs are recognised
in the Group income statement as incurred. Any contingent consideration is recognised at fair value at the acquisition date, with subsequent changes in
fair value recognised in the Group income statement. Non-controlling interests in subsidiaries are measured either at fair value or at the non-controlling
interest’s proportionate share of the acquiree’s identifiable net assets on a case-by-case basis. Put options over non-controlling interests are classified
as a financial liability as there is no unavoidable right to defer settlement of the obligation.
Operating segments
As a result of the change in Chief Executive Officer and subsequent reorganisation of the Senior Executive Committee and Executive Committee
in the year, we have revisited the definition of the Chief Operating Decision Maker (CODM) which has been identified as the Man Group Board
(the Board) as Man Group’s key decision-making body.
Management information regarding revenues, net management fee margins and investment performance relevant to the operation of the investment
managers, products and the investor base are reviewed by the Board. A centralised shared infrastructure for operations, product structuring,
distribution and support functions for our investment management business means that operating costs are not allocated to its constituent parts.
As a result, performance is assessed, resources are allocated, and other strategic and financial management decisions are determined by the
Board, considering our investment management business as a whole. Accordingly, we operate and report the investment management business as
a single segment, together with relevant information regarding AUM, flows and net management fee margins, to allow for analysis of the direct
contribution of products and the respective investor base.
Impact of new accounting standards
There were no new or amendments to existing accounting standards issued by the International Accounting Standards Board (IASB) effective for the
first time in the year to 31 December 2023 that have had a significant impact on these Group financial statements.
We have applied the temporary exception issued by the IASB in May 2023 from the accounting requirements for deferred taxes in IAS 12 ‘Income
Taxes’. Accordingly, Man Group neither recognises nor discloses information about deferred tax assets and liabilities related to Pillar 2 income taxes.
In November 2023, the IASB issued an exposure draft (ED) on Financial Instruments with Characteristics of Equity, which impacts the accounting for
non-controlling interests over which there is a put option. The ED requires non-controlling interests to be recognised and measured based on
current rights associated with an instrument, as well as the recognition of a put option over an entity’s own shares at the present value of the gross
settlement value. While the proposals have not had a material impact on the Group financial statements in the year, the impact could become more
material in the future as the value of the non-controlling interests in the businesses acquired in the year increase.
No other standards or interpretations issued and not yet effective are expected to have a material impact on the Group financial statements.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
143
2. Going concern
The preparation of the Group financial statements on a going concern basis is supported by the forecast financial performance and capital and
liquidity analysis of Man Group, as approved by the Board. This analysis considers our net financial assets and liquidity resources and requirements
and utilises the Man Group budget, medium-term plan and the capital and liquidity plan. These plans include rigorous downside testing, including
analyses of stressed capital and liquidity scenarios, and incorporate Man Group’s principal and emerging risks, which are outlined on pages 30 to 34
and monitored by the Board on an ongoing basis.
3. Judgemental areas and accounting estimates
The preparation of financial statements in conformity with IFRS requires the use of accounting estimates and assumptions. We continually evaluate
our estimates and judgements based on historical experience and expectations of future events that are considered reasonable in the
circumstances. These judgements and estimates are an area of focus for the Board and, in particular, the Audit and Risk Committee.
Critical judgements
Consolidation of fund entities
Man Group acts as the investment manager or adviser to fund entities. A significant area of judgement is whether we control certain of those fund
entities to which we are exposed via either direct investment holdings, total return swaps, or sale and repurchase arrangements. We assess such
relationships on an ongoing basis to determine whether we control each fund entity and therefore consolidate them into our results. Further details
of the control assessment are set out in Note 12.
Acquisition of Varagon
Significant judgement was applied in determining the appropriate accounting treatment of the acquisition of Varagon Capital Partners, L.P.
(Varagon). In determining the classification of amounts payable to certain sellers as post-acquisition remuneration rather than consideration for the
acquisition, we considered the rights and obligations of those sellers under the terms of the transaction, balancing the economic substance of the
transaction against the potential forfeiture of future profit distributions and the right to sell their economic interest to Man Group in the future, and
changes to the price at which the economic interest may be sold. We have determined that payments to sellers who are also employees should be
accounted for as employment-related costs.
Further judgement was applied when determining the appropriate accounting policies to apply to these arrangements, since the terms differ
significantly from more common forms of compensation. In particular, we have applied judgement when selecting the appropriate vesting period for
the put options accounted for as cash-settled share-based payments. Since the maximum settlement value of the options varies over time, different
vesting periods have been selected for the period over which each alternate value can be earned. Changes in the fair value of these cash-settled
share-based payments will be recognised in the Group income statement up until the final settlement date.
The determination of the treatment of future amounts payable to the selling shareholders who are also key customers also involved significant
judgement when determining whether to treat them as payments in their capacity as customers or as sellers. We have determined that these
payments should be treated as part of the customer relationship as they are outlined in the investment management agreements and are in
substance reductions in future fees charged for services rendered by Man Group.
Acquisition of Asteria
Judgement was applied in determining the appropriate accounting treatment of the acquisition of Asteria Investment Managers SA (Asteria),
in particular the accounting for the non-controlling interest and the associated put option, including the decision to not separately disclose the
immaterial non-controlling interest. As the transaction is not material, this is not considered a significant judgement.
Further information in relation to the acquisitions of Varagon and Asteria is set out in Note 17.
Critical accounting estimates
Acquisition of Varagon
Man Group’s acquisition of Varagon in the year has introduced new sources of estimation uncertainty. The measurement of provisional values of the
identifiable assets acquired, liabilities assumed and goodwill arising on the acquisition required the use of multiple uncertain inputs (Note 17). An
increase or decrease in the fair value of the assets acquired and liabilities assumed would result in an equal and offsetting decrease or increase in
goodwill. The value of employment-related expenses arising from business combinations is a further source of significant estimation uncertainty as
the expenses are determined with reference to the expected future value and performance of the Varagon business (Note 5).
Pension
The estimation uncertainty arising on the valuation of the pension asset remains a critical accounting estimate (Note 23).
Other considerations
The Board has also considered the assumptions used in the assessments for impairment of goodwill and right-of-use lease assets, the recoverability
of deferred tax assets and the valuation of contingent consideration and the put option over non-controlling interests relating to the acquisition of
Asteria. They have concluded that these assumptions do not have a significant risk of causing a material adjustment to the carrying amounts of our
assets or liabilities at the balance sheet date.
The Board has also considered the impact of climate change on the Group financial statements, in particular in relation to the going concern
assessment, the cash flow forecasts used in the impairment assessments of non-current assets and the assumptions around future life
expectancies used in the valuation of the net pension asset. The impact of climate change on the Group financial statements is not currently
expected to be material.
Man Group plc | Annual Report 2023
144
Financial statements
Notes to the Group financial statements continued
4. Revenue
Accounting policy
Fee income is our primary source of revenue, which is derived from the investment management agreements that we have in place with the fund
entities or the accounts that we manage.
Management and other fees (net of rebates), which include all non-performance related fees, are recognised in the period in which the services
are provided and do not include any other performance obligations. Fees are generally based on an agreed percentage of NAV or AUM and are
typically charged in arrears and receivable within one month.
Performance fees (net of rebates) relate to the performance of the funds or managed accounts managed during the year and are recognised
when the performance obligation has been met, whereby the fee has crystallised and can be reliably estimated. This is generally at the end of
the performance period or upon early redemption by an investor. Until the performance period ends, market movements could significantly
move the NAV of the fund products and therefore the value of any performance fees receivable. For alternative strategies, we will typically only
earn performance fees on any positive investment returns in excess of the high-water mark, meaning we will not be able to earn performance
fees with respect to positive investment performance in any year following negative performance until that loss is recouped. For long-only
strategies, performance fees are usually earned only when performance is in excess of a predetermined strategy benchmark (positive alpha).
Once crystallised, performance fees typically cannot be clawed back. There are no other performance obligations or services provided which
suggest these have been earned either before or after the crystallisation date.
Rebates, which relate to repayments of management and performance fees charged, typically to institutional investors, are recognised in the
same period as the associated fees. As rebates constitute a reduction in the fees charged for services provided, they are presented net within
management and other fees and performance fees in the Group income statement.
5. Costs
Accounting policy
Distribution costs
Distribution costs, which are paid to external intermediaries for marketing and investor servicing, largely in relation to retail investors, are
typically variable with AUM and the associated management fee revenue. Distribution costs are expensed over the period in which the service
is provided.
Asset servicing costs
Asset servicing includes custodial, valuation, fund accounting, registrar, research and administration functions performed by third parties as well
as market data acquired under contract to Man Group, on behalf of the funds or managed accounts. Asset servicing costs are recognised in the
period in which the services are provided. The costs of these services vary based on transaction volumes, the number of funds or managed
accounts and their NAVs, and the mix of client strategies.
Compensation costs
Salaries, variable cash compensation and social security costs are charged to the Group income statement in the period in which the service
is provided and include partner drawings. In the short term, the variable component of compensation adjusts with revenues and profitability.
Compensation can be deferred by way of equity-settled share-based payment schemes and fund product-based compensation arrangements.
Where deferred compensation relates to our fund products, the fair value of the employee services received in exchange for the fund
investments is recognised as a straight-line expense of the mark-to-market value of the awards over the relevant vesting period, with a
corresponding liability recognised in the Group balance sheet. We generally elect to separately purchase the equivalent fund investments at
grant date to offset any associated change in the value of deferred compensation due, and on vesting the value of the fund investment is
delivered to the employee (subject to the terms of the plan rules, which include malus provisions). If a fund product-based award is forfeited,
the cumulative charge recognised in the Group income statement is reversed in full.
Other employment-related expenses
Other employment-related expenses relate to amounts payable to sellers of businesses acquired in exchange for post-acquisition services and
are recognised in profit and loss over the sellers’ relevant service periods.
5.1. Compensation costs and other employment-related expenses
Salaries
Variable cash compensation
Deferred compensation: share-based payment charge
Deferred compensation: fund product-based payment charge
Social security costs
Pension costs (Note 23)
Compensation costs
Other employment-related expenses (Note 24)
Total employment-related expenses recognised in the Group income statement
Comprising:
Fixed compensation: salaries and associated social security costs, and pension costs
Variable compensation: variable cash compensation, deferred compensation and associated social security costs
Other employment-related expenses
Man Group plc | Annual Report 2023
2023
$m
201
205
40
83
50
16
595
23
618
239
356
23
2022
$m
174
321
45
72
52
14
678
–
678
209
469
–
Strategic report | Governance | Financial statements | Shareholder information
145
5. Costs continued
5.1. Compensation costs and other employment-related expenses continued
The unamortised deferred compensation at 31 December 2023 is $120 million (2022: $76 million) and has a weighted average remaining vesting
period of 2.2 years (2022: 1.5 years). $2 million of the $23 million other employment-related expenses relates to the portion of profits earned in the
year ended 31 December 2023 which are payable to Varagon selling shareholders.
Sensitivity analysis
The value recognised for other employment-related expenses is an area of significant estimation uncertainty as the fair value has been determined
with reference to the expected future value and performance of the Varagon business. The estimates will be updated in each reporting period until
the associated liabilities are settled. The table below illustrates the impact of changing the most significant assumptions used in the expected future
value calculation on the expense recognised in the Group income statement.
$m
Discount rate decreased/(increased) by 5% p.a.
Forecast future cash flows increased/(decreased) by 50% p.a.
5.2. Other costs
Audit, tax, legal and other professional fees
Technology and communications
Occupancy
Temporary staff, recruitment, consultancy and managed services
Staff benefits
Insurance
Travel and entertainment
Marketing and sponsorship
Claims
Other costs, including irrecoverable VAT
Other costs – consolidated fund entities
Acquisition-related costs (Note 17)
Other costs before depreciation and amortisation
Depreciation of leasehold improvements and equipment (Note 15)
Depreciation of right-of-use lease assets (Note 16.1)
Amortisation of other intangibles (Note 19)
Total other costs
Auditor’s remuneration, including professional services, is disclosed in the Audit and Risk Committee report on page 94.
Average headcount
The table below details average headcount by function, including directors, employees, partners and contractors.
Investment management
Sales and marketing
Technology and infrastructure1
Average headcount
Headcount at 31 December
Note:
1
Includes all staff performing technology-based roles, including those supporting the investment management side of our business.
6. Finance expense and finance income
Finance expense
Unwind of lease liability discount (Note 16.1)
Interest expense on total return swaps and sale and repurchase agreements
Other finance expense
Total finance expense
Finance income
Interest on cash deposits
Unwind of finance lease discount (Note 16.2)
Total finance income
Net finance expense
Man Group plc | Annual Report 2023
Increase/(decrease) in 2023
employment-related expense
8
3
2023
$m
24
24
20
13
19
5
11
5
1
10
9
9
150
12
14
22
198
(6)
(20)
2022
$m
24
22
18
17
14
7
7
5
–
9
9
–
132
12
17
18
179
2023
469
251
996
1,716
1,790
2022
427
238
930
1,595
1,655
2023
$m
(10)
(12)
(12)
(34)
12
1
13
2022
$m
(10)
(3)
(3)
(16)
5
–
5
(21)
(11)
146
Financial statements
Notes to the Group financial statements continued
7. Current tax and tax expense
Accounting policy
Current tax is based on our taxable profit for the year. Taxable profit differs from net profit as reported in the Group income statement because
it excludes items of income or expense that are taxable or deductible in other years, in addition to items that are never taxable or deductible.
Accounting for tax involves a level of estimation uncertainty given the application of tax law requires a degree of judgement, which tax authorities
may dispute. Tax liabilities are recognised based on the best estimates of probable outcomes, with regard to external advice where appropriate.
We are a global business and therefore operate across many different tax jurisdictions. Income and expenses are allocated to these different
jurisdictions based on transfer pricing methodologies set in accordance with the laws of the jurisdictions in which we operate, and international
guidelines as laid out by the Organisation for Economic Co-operation and Development (OECD). The effective tax rate results from the
combination of taxes paid on earnings attributable to the tax jurisdictions in which they arise.
The movements in our net current tax assets/liabilities are as follows:
Net current tax liability at beginning of the year
Charge to the Group income statement
Credit to equity
Tax paid
Other balance sheet movements
Foreign currency translation
Net current tax (asset)/liability at end of the year
Current tax
UK corporation tax on profits
Foreign tax
Adjustments to tax charge in respect of previous years
Current tax expense
Deferred tax
Origination and reversal of temporary differences
Adjustments to tax charge in respect of previous years
Deferred tax credit (Note 20)
2023
$m
37
65
(5)
(100)
(6)
(3)
(12)
2023
$m
56
14
(5)
65
(23)
3
(20)
2022
$m
15
159
(4)
(125)
(5)
(3)
37
2022
$m
140
19
–
159
(13)
(9)
(22)
Total tax expense
45
137
Factors affecting the tax expense for the year
The majority of our profits in the period were earned in the UK, Switzerland and the US. On 1 April 2023, the UK corporation tax rate increased to
25% from 19%. Our tax expense is lower (2022: lower) than the amount that would arise using the theoretical tax rate applicable to our profits
as follows:
Profit before tax
Theoretical tax expense at UK rate: 23.5% (2022: 19%)
Effect of:
Overseas tax rates different to UK
Adjustments to tax charge in respect of previous years
(Recognition)/derecognition of US deferred tax assets (Note 20)
Other
Tax expense
The effective tax rate in the year was 16% (2022: 18%).
2023
$m
279
66
(4)
(2)
(19)
4
45
2022
$m
745
142
(2)
(9)
7
(1)
137
Factors affecting our future tax charges
The principal factors which may influence our future tax rate are changes in tax legislation in the territories in which we operate, the mix of income
and expenses earned and incurred by jurisdiction, and the consumption of available deferred tax assets.
The OECD has published an Inclusive ‘Pillar 2’ Framework (the Framework) to support the introduction of a global minimum tax rate of 15%. The UK
has enacted its legislation in Finance (No. 2) Act 2023, effective from 2024. We anticipate being subject to the global minimum top-up tax in certain
jurisdictions in which we operate, notably Ireland and Switzerland. However, based on historical and anticipated profit profiles, the impact on our
effective tax rate is not expected to be greater than 1%. We are continuing to assess the impact of Pillar 2 legislation on our future financial results.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
147
8. Cash, liquidity and borrowings
Accounting policy
Cash and cash equivalents
Cash and cash equivalents comprise cash and short-term investments in money market funds or bank deposits with an original maturity of three
months or less. Cash and cash equivalents are measured at amortised cost, which is approximately equal to fair value. Available cash and cash
equivalents are invested in accordance with strict limits consistent with the Board’s risk appetite, which consider both the security and
availability of liquidity. Accordingly, cash is held in on-demand and short-term bank deposits and money market funds, and at times invested in
short-term US Treasury bills (which meet the definition of cash equivalents). Cash and cash equivalents include restricted balances held by
consolidated fund entities to which we do not have access, and which are subject to legal or contractual restrictions as to their use.
Borrowings
Borrowings comprise amounts drawn under committed revolving credit facilities. Borrowings are initially recorded at fair value and subsequently
measured at amortised cost. Drawdowns under revolving credit facilities are typically for maturities of one month or less and are therefore
presented net of repayments in the Group cash flow statement.
Cash held with banks
Short-term deposits
Money market funds
Cash held by consolidated fund entities (Note 12.2)
Cash and cash equivalents
Less: cash held by consolidated fund entities (Note 12.2)
Available cash and cash equivalents
Undrawn committed revolving credit facility1
Total liquidity
2023
$m
92
46
42
96
276
(96)
180
660
840
2022
$m
124
95
130
108
457
(108)
349
500
849
Note:
1 Excludes the $300 million facility acquired with Varagon in the year. This facility was undrawn at 31 December 2023 and subsequently cancelled in January 2024.
Cash and cash equivalents
At 31 December 2023, the $180 million available cash and cash equivalents balance was held with 19 banks (2022: $349 million with 14 banks).
Credit ratings of banks
AAA
AA
A
Total
2023
$m
31
67
82
180
2022
$m
103
103
143
349
The single largest counterparty bank exposure of $50 million is held with an A- rated bank (2022: $101 million held with an A- rated bank).
Liquidity risk management
Liquidity resources support ongoing operations and potential liquidity requirements under scenarios that assume stressed market and economic
conditions. Our funding requirements relating to the investment management process are discretionary. Our liquidity profile is monitored on a daily
basis and the stressed scenarios are updated regularly. The Board reviews our funding resources at each Board meeting and on an annual basis,
as part of the strategic planning process. Our available liquidity is considered sufficient to cover current requirements and potential requirements
under stressed scenarios.
Our maximum exposure to loss associated with interests in our consolidated CLOs is limited to the net investment in these CLOs (Note 12.2).
Therefore, the CLO liabilities on the Group balance sheet of $1,036 million (2022: nil) do not present a liquidity risk to Man Group as we have
no obligation to repay the noteholders at maturity should the CLO assets be insufficient to meet the obligations.
Further information relating to Man Group’s exposure to liquidity risk is set out on page 31.
Borrowings
Our $800 million committed revolving credit facility (RCF) is immediately accessible. It does not include financial covenants to maintain maximum
flexibility. The RCF was put in place in December 2023, replacing the previous $500 million facility, as a five-year facility with two one-year extension
options and is currently scheduled to mature in December 2028. $140 million was drawn down at 31 December 2023 (2022: undrawn).
Man Group plc | Annual Report 2023
148
Financial statements
Notes to the Group financial statements continued
9. Reconciliation of statutory profit to cash generated from operations
Accounting policy
Cash flows arising from the purchase and sale of investments in fund products and other investments, and from transactions with third-party
investors in consolidated fund entities, are included in cash flows from operating activities in the Group cash flow statement. This classification
reflects the fact that these investments are to build product breadth and to trial investment research before marketing the products broadly to
investors as part of Man Group’s ordinary operations or are otherwise held in connection with settling employee remuneration and are not
intended to be held as long-term investments.
Cash flows from operating activities
Statutory profit
Adjustments for:
Share-based payment charge
Fund product-based payment charge
Other employment-related expenses
Net finance expense
Tax expense
Depreciation of leasehold improvements and equipment
Depreciation of right-of-use lease assets
Gain on disposal of investment property – right-of-use lease assets
Amortisation and impairment of acquired intangibles
Amortisation of other intangibles
Share of post-tax loss of associates
Realised gains on cash flow hedges
Foreign exchange movements
Other non-cash movements
Changes in working capital1:
Decrease/(increase) in fee and other receivables
Decrease/(increase) in other financial assets including consolidated fund entities2
(Decrease)/increase in trade and other payables
Cash generated from operations
Note
5.1
5.1
5.1
6
7
15
16.1
16.2
18
19
22
2023
$m
234
40
83
23
21
45
12
14
(12)
28
22
3
(12)
3
(9)
495
104
71
(200)
470
2022
$m
608
45
72
–
11
137
12
17
–
51
18
5
(7)
(13)
(5)
951
(68)
(45)
40
878
Notes:
1 Changes in working capital differ from the movements in these balance sheet items due to non-cash movements which either relate to the gross-up of the third-party share of consolidated fund
entities (Note 12.2) or are adjusted elsewhere in the Group cash flow statement, such as movements relating to the fund product-based payment charge and other employment-related expenses
(within operating activities) and the share repurchase liability (within financing activities).
Includes $12 million of restricted net cash outflows (2022: $44 million cash inflows) relating to consolidated fund entities (Note 12.2).
2
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
149
10. Fee and other receivables
Accounting policy
Fee and other receivables are initially recorded at fair value and subsequently measured at amortised cost using the effective interest rate
method, except for derivatives (measured at fair value through profit and loss) and prepayments. Fee receivables and accrued income relate to
management and performance fees and are received in cash following finalisation of the NAVs of the underlying funds or managed accounts.
Fee receivables
Accrued income
Collateral posted with derivative counterparties
Receivables from Open Ended Investment Company (OEIC) funds
Other fund receivables
Prepayments
Derivatives
Other receivables
Receivables relating to consolidated fund entities (Note 12.2)
Fee and other receivables
Comprising:
Financial assets at amortised cost
Financial assets at fair value through profit or loss
Non-financial assets
2023
$m
25
274
48
39
29
23
5
20
88
551
523
5
23
2022
$m
35
359
39
20
36
17
9
26
29
570
544
9
17
Credit risk management
The majority of fees are deducted from the NAVs of the respective funds by the independent administrators and therefore the credit risk of fee
receivables is minimal. No balances are overdue and, under the expected credit loss model of IFRS 9 ‘Financial Instruments’, no impairment
has been recognised at 31 December 2023 (2022: nil). Included in fee and other receivables at 31 December 2023 are balances of $2 million
(2022: $1 million) which are expected to be settled after more than 12 months.
11. Trade and other payables
Accounting policy
Trade and other payables are initially recorded at fair value, which is usually the invoiced amount, and subsequently measured at amortised cost
using the effective interest rate method, except for derivatives, contingent consideration payable and put options over non-controlling interests
in subsidiaries, which are measured at fair value through profit and loss.
Trade payables
Compensation accruals
Other accruals
Share repurchase liability
Payables under repo arrangements
Payables to OEIC funds
Tax and social security
Derivatives
Contingent consideration (Note 17)
Put option over non-controlling interests in subsidiaries (Note 24)
Employment-related payables to sellers of businesses acquired (Note 5)
Other payables
Payables relating to consolidated fund entities (Note 12.2)
Trade and other payables
Comprising:
Financial liabilities at amortised cost
Financial liabilities at fair value through profit or loss
Trade and other payables can be analysed according to their contractual maturity dates as follows:
Within one year
Between one and three years
After three years
Man Group plc | Annual Report 2023
2023
$m
7
365
79
–
45
39
31
12
3
9
23
7
116
736
712
24
2023
$m
658
49
29
736
2022
$m
4
453
86
98
54
18
30
6
–
–
–
13
180
942
936
6
2022
$m
871
71
–
942
150
Financial statements
Notes to the Group financial statements continued
12. Investments in fund products and other investments
Accounting policy
Investments in fund products are classified at fair value through profit or loss, with net gains due to movements in fair value recognised through
net income or gains on investments and other financial instruments.
The fair values of investments in fund products other than CLOs are typically derived from their reported NAVs, which in turn are based upon
the value of the underlying assets. The valuation of the underlying assets within each fund product is determined by external valuation service
providers based on an agreed valuation policy and methodology. While these valuations are performed independently of Man Group, we have
established oversight procedures and due diligence processes to ensure that the NAVs reported by the external valuation service providers are
reliable and appropriate. Purchases and sales of investments are recognised on trade date.
Our holdings in unconsolidated CLO risk retention assets are priced using a bottom-up valuation method. We use third-party valuations to price
the securities within the underlying portfolios and then apply the percentage of the CLO notes we hold to these valuations.
Seeding investments portfolio
We use capital to invest in fund products as part of our ongoing business, to build product breadth and to trial investment research
developments before marketing the products broadly to investors. Seed capital is invested via direct holdings in fund products or sale and
repurchase (repo) arrangements, which allow us to finance seed investments without consuming high levels of cash. Alternatively, we may
obtain exposure to seed investments via total return swap (TRS) arrangements. Under a repo arrangement we are committed to repurchase
the underlying seed investments at maturity and pay an interest charge over the period, with the obligation to repurchase the assets on
maturity recorded as a liability within trade and other payables. Under a TRS arrangement, we are under no form of repayment obligation and
have no ownership interest (or voting rights) in the underlying investment. In exchange for the returns on the underlying seed investments, we
pay a floating rate of interest.
Other than our holdings in CLOs and co-investments, our seed investments are generally liquid in nature and may be liquidated at short notice. It is
not practicable to allocate our seeding investments portfolio between amounts expected to be recovered or settled within or after 12 months after
the end of the reporting period as the sale or liquidation of seed investments is subject to client asset raising and the ongoing requirements of the
business. The majority of our CLO holdings are likely to be settled more than 12 months after the end of the reporting period.
Consolidation
The control considerations under IFRS 10 ‘Consolidated Financial Statements’ apply to fund product investments, including those underlying
our repo and TRS instruments. Fund entities deemed to be controlled are consolidated on a line-by-line basis from the date control commences
until it ceases. In the control assessment, we consider our exposure to variable returns and the existence of substantive kick-out rights. Other
factors considered include the nature of relevant fee arrangements, the decision-making powers we hold as investment manager or adviser and
whether the shares we hold include voting rights. Where we are not deemed to control the fund, our investment is classified within investments
in fund products.
We only have limited exposure to the variable returns of the fund entities we manage unless we either hold an investment in the fund entity or
receive the returns of the fund entity via a TRS or repo arrangement. For most fund entities: the existence of independent boards of directors;
rights which allow for the removal of the investment manager or adviser; the influence of external investors; limited exposure to variable returns;
and the arm’s length nature of our contracts with those fund entities, indicate that we do not control them. As a result, the associated assets,
liabilities, and results of these funds are not consolidated into the Group financial statements.
The assets held by the CLOs we consolidate are priced using independent pricing sources. Other than subordinated notes, the debt liabilities
of consolidated CLOs are valued at par plus accrued interest, which is considered equivalent to fair value. The subordinated notes of these
CLOs are priced using an intrinsic valuation approach, excluding any potential future value.
Investment property held by consolidated fund entities comprises land and buildings held to earn rent or for capital appreciation, or both, and is
measured at cost less depreciation and impairment. Other than land, which is not depreciated, depreciation is calculated on a straight-line basis
over the asset’s estimated useful life (between three and 30 years).
Third-party interests in consolidated fund entities are measured at amortised cost.
Fund product investments held for deferred compensation arrangements
We hold fund product investments related to deferred compensation arrangements to offset any change in the associated compensation cost
over the vesting period. At vesting, the value of the fund investment is delivered to the employee. These fund product investments are measured
at fair value and include balances held by the Employee Trust.
The seeding investments portfolio reflects our exposure to holdings in investments in fund products, as follows:
Investments in fund products
Investments in consolidated funds: transferable securities (Note 12.2)
Other investments
Investments in fund products and other investments
Less:
Fund investments held for deferred compensation arrangements
Investments in consolidated funds: exclude consolidation gross-up of net investment
Other investments
Seeding investments portfolio
2023
$m
289
1,987
3
2,279
(189)
(1,492)
(3)
595
2022
$m
304
905
–
1,209
(153)
(368)
–
688
Included in fund investments held for deferred compensation arrangements at 31 December 2023 are balances of $101 million (2022: $80 million)
which are expected to be settled after more than 12 months.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
151
12. Investments in fund products and other investments continued
12.1. Investments in fund products
At 31 December 2023, exposure to fund products via repo arrangements (included within investments in fund products, with an offsetting
repayment obligation included within trade and other payables) was $45 million (2022: $54 million). Additional exposure via TRS was $230 million
(2022: $138 million). The largest single investment in fund products at 31 December 2023 was $88 million (2022: $61 million).
Income or gains on investments and other financial instruments comprises the following:
Net gains/(losses) on seeding investments portfolio
Consolidated fund entities: gross-up of net gains on investments
Foreign exchange movements
Net gains/(losses) on fund investments held for deferred compensation arrangements and other investments
Net income or gains on investments and other financial instruments
2023
$m
47
39
(11)
1
76
2022
$m
(12)
–
22
(3)
7
12.2. Consolidation of investments in funds
At 31 December 2023, our interests in 35 (2022: 43) funds met the definition of control and have therefore been consolidated on a line-by-line basis.
Certain of our CLOs have been consolidated for the first time in the year following the purchase of majority holdings in the subordinated tranches.
Consolidated fund entities are included within the Group balance sheet and income statement as follows:
Balance sheet
Cash and cash equivalents (Note 8)
Transferable securities1
Fees and other receivables
Investment property
Trade and other payables
CLO liabilities
Net assets of consolidated fund entities
Third-party interest in consolidated funds
Net investment held by Man Group
Income statement
Net gains/(losses) on investments2
Rental income3
Management fee expenses4
Performance fee expenses4
Other costs5
Net gains/(losses) of consolidated fund entities
Third-party share of (gains)/losses relating to interests in consolidated funds
Net gains/(losses) attributable to net investment held by Man Group
2023
$m
96
1,987
88
30
(116)
(1,036)
1,049
(554)
495
90
1
(5)
(2)
(9)
75
(24)
51
2022
$m
108
905
29
34
(180)
–
896
(359)
537
(31)
–
(4)
(1)
(9)
(45)
14
(31)
Included within investments in fund products and other investments. Includes assets held by consolidated CLOs of $1,103 million.
Included within net income or gains on investments and other financial instruments.
Notes:
1
2
3 Relates to rental income generated from investment property held by consolidated fund entities.
4 Relates to management and performance fees paid by the funds to Man Group during the year, which are eliminated within management and other fees and performance fees respectively in the
Group income statement.
Includes depreciation and impairment of investment property held by consolidated fund entities.
5
Movements in the carrying value of investment property held by consolidated fund entities can be analysed as follows:
Cost at beginning of the year
Additions
Disposals
Cost at end of the year
Accumulated depreciation and impairment at beginning of the year
Depreciation
Reversal of impairment/(impairment)
Accumulated depreciation and impairment at end of the year
Net book value at beginning of the year
Net book value at end of the year
2023
$m
38
–
(4)
34
(4)
(1)
1
(4)
34
30
2022
$m
–
38
–
38
–
(1)
(3)
(4)
–
34
The fair value of investment property held by consolidated fund entities of $30 million at 31 December 2023 (2022: $34 million) is based on valuations
provided by independent property experts.
Man Group plc | Annual Report 2023
152
Financial statements
Notes to the Group financial statements continued
13. Fair value of financial assets and liabilities
Accounting policy
We disclose the fair value measurement of financial assets and liabilities using three levels, as follows:
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly (i.e. as prices)
or indirectly (i.e. derived from prices).
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
The majority of our investments in fund products fall within Level 2 due to the levels of subscription and redemption activity and the liquidity of
the underlying investments. Level 2 investments in fund products primarily comprise holdings in unlisted, open-ended, active and liquid funds,
which are priced using daily or weekly observable market information derived from third-party sources. A transfer into Level 3 would be deemed
to occur where the level of activity, as evidenced by subscriptions and redemptions, is deemed insufficient to support a Level 2 classification.
Other factors, such as a deterioration of liquidity in the underlying investments, would also result in a Level 3 classification.
The assets held by our consolidated CLOs comprise a portfolio of bonds and loan securities. Loans are valued using broker quotes sourced
from an independent pricing service, with bonds priced using latest prices executed for similar assets. We do not make any adjustments to the
quotes obtained. Where the quotes are obtained from multiple pricing sources within a narrow range, the assets are classified as Level 2 in the
fair value hierarchy. Where prices are derived from a small number of quotes, or where there is a wide bid-ask spread between quotes, we
classify these assets as Level 3.
Transferable securities held by our other consolidated funds which are classified as Level 3 have significant unobservable inputs, as they trade
infrequently or not at all. When observable prices are not available for these securities, we use valuation techniques for which sufficient and
reliable data is available. Level 3 investments may also be adjusted to reflect illiquidity and/or non-transferability.
The fair values of our financial assets and liabilities held at fair value through profit and loss can be analysed as follows:
$m
Level 1
Level 2
Level 3
Total
Level 11
Level 21
Level 3
Total
2023
2022
Financial assets held at fair value:
Investments in fund products and other
investments (Note 12)
Investments in consolidated funds: transferable
securities (Note 12.2)
Derivatives (Note 10)
Financial liabilities held at fair value:
Derivatives (Note 11)
Contingent consideration (Note 17)
Put option over non-controlling interests in subsidiaries
(Note 17)
CLO liabilities – consolidated fund entities (Note 12.2)
–
280
12
292
274
–
274
1,567
5
1,852
–
–
–
–
–
(12)
–
–
(1,036)
(1,048)
146
–
158
–
(3)
(9)
–
(12)
1,987
5
2,284
(12)
(3)
(9)
(1,036)
(1,060)
–
401
–
401
–
–
–
–
–
284
504
9
797
(6)
–
–
–
(6)
20
–
–
20
–
–
–
–
–
304
905
9
1,218
(6)
–
–
–
(6)
Note:
1 $401 million of investments in consolidated funds: transferable securities previously reported as Level 2 are now reported as Level 1 to reflect the nature of the underlying securities within the
consolidated funds. Previously, the inputs to the overall pricing of the investments in consolidated funds were considered when determining the appropriate classification in the fair value hierarchy.
The movements in Level 3 financial assets and liabilities held at fair value are as follows:
$m
At beginning of the year
Transfers out of Level 3
Purchases
Credit/(charge) to Group income statement1,2
Sales or settlements
Change in consolidated fund entities held
At end of the year
Notes:
1
2 Includes net unrealised gains of $1 million (2022: losses of $5 million).
Included within net income or gains on investments and other financial instruments.
2023
2022
Assets
Liabilities
Assets
Liabilities
20
(11)
2
1
–
146
158
–
–
(12)
–
–
–
(12)
190
(154)
1
(5)
(1)
(11)
20
–
–
–
–
–
–
–
Purchases of Level 3 financial liabilities relate to the fair value of contingent consideration and the put option over the non-controlling interest arising
on the acquisition of Asteria (Note 17).
The Level 3 financial assets in the portfolios of our consolidated fund entities other than CLOs primarily comprise bonds, equities and credit-linked
notes. The techniques used the valuations of those assets primarily include discounted cash flows, estimated recovery and single broker quotes.
The unobservable inputs in those valuations comprise future cash flows, discount rates and yields.
Sensitivity analysis
A 5% increase/decrease in the valuations of Level 3 financial assets would result in a $8 million increase/decrease in their fair value.
Changes in the unobservable inputs to the valuation of Level 3 financial liabilities would not be expected to result in a significant change in the
carrying value of these assets and liabilities, and hence a sensitivity analysis has not been presented.
Man Group plc | Annual Report 2023
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153
14. Market risks and derivatives
Accounting policy
Derivatives
We use derivative financial instruments to manage market risk in certain circumstances. These consist primarily of market risk hedges on some
of our seeding positions and foreign exchange contracts. The carrying value of these derivatives are included in fee and other receivables and
trade and other payables.
Hedge accounting
We apply cash flow hedge accounting to fund investments related to deferred fund product awards, whereby the offsetting gains or losses on
these fund products are matched against the corresponding fund product-based payment compensation charge in the Group income
statement pro rata over the vesting period. Gains or losses are recognised through other comprehensive income and held within the cash flow
hedge reserve in equity until they are recycled over the vesting period into the Group income statement.
We apply net investment hedge accounting to the net assets of material subsidiaries that have a functional currency other than USD. Gains or
losses on derivatives are recycled from the Group income statement through other comprehensive income in the foreign currency translation
reserve in equity to offset the impact of any currency translation of the net assets of these subsidiaries. The accumulated gains or losses are
recycled to the Group income statement on disposal of the related subsidiary.
As in 2022, all derivatives are held with counterparties with ratings of A or higher and mature within one year.
Management of market risk arising from investments in funds
Investments in fund products expose us to market risk and are therefore managed within limits consistent with the Board’s risk appetite. In certain
circumstances, we use derivative financial instruments, specifically equity or credit default swaps, to hedge the risk associated with mark-to-
market movements.
The market risk from seeding investments, including those financed via repo and TRS arrangements, is modelled using a value at risk methodology
with a 95% confidence interval and one-year time horizon. The value at risk is estimated to be $61 million at 31 December 2023 (2022: $43 million).
We generally hold an investment in the associated fund products to hedge the mark-to-market movement in fund product-based compensation over
the vesting period.
Our maximum exposure to loss associated with interests in our consolidated CLOs is limited to the net investment in these CLOs (Note 12.2).
Therefore, the CLO liabilities on the Group balance sheet of $1,036 million (2022: nil) do not present a market risk to Man Group as we have
no obligation to repay the noteholders at maturity should the CLO assets be insufficient to meet the obligations.
Further information relating to Man Group’s exposure to market risk is set out on pages 31 and 32.
Market risk hedges
Notional value of derivatives at 31 December
Assets
Liabilities
Net (liabilities)/assets
For the year ended 31 December
(Loss)/gain recognised in the Group income statement
2023
$m
–
(175)
(175)
2022
$m
149
(71)
78
(17)
39
Management of foreign exchange rate risk
We are subject to risk from changes in foreign exchange rates on monetary assets and liabilities. In certain circumstances, we use derivative financial
instruments, specifically forward foreign exchange contracts with a one-month duration, to hedge the risk associated with foreign exchange movements.
During the year, there were $11 million of net realised and unrealised foreign exchange losses (2022: $22 million gains) recognised in the Group
income statement through net income or gains on investments and other financial instruments, including the effects of hedging. This primarily
comprises a $10 million unrealised loss (2022: $25 million gain) relating to the revaluation of our $209 million (2022: $200 million) unhedged sterling
lease liability.
Foreign exchange hedges
Notional value of derivatives at 31 December
Assets
Liabilities
Net liabilities
For the year ended 31 December
(Loss)/gain before the impact of hedging
(Loss)/gain on hedging instruments
(Loss)/gain recognised in the Group income statement after the impact of hedging
2023
$m
124
(343)
(219)
(4)
(7)
(11)
2022
$m
82
(235)
(153)
5
17
22
Man Group plc | Annual Report 2023
154
Financial statements
Notes to the Group financial statements continued
14. Market risks and derivatives continued
The table below reflects the currency profile of our net foreign currency (non-USD) monetary assets and liabilities after the impact of hedging:
Sterling
Australian dollar
Japanese yen
Other
Total
2023
$m
(138)
14
7
10
(107)
2022
$m
(155)
41
19
10
(85)
A 10% strengthening/weakening of the USD against all other currencies, with all other variables held constant, would have resulted in a foreign
exchange loss/gain of $11 million (2022: $9 million), with a corresponding impact on equity. This pre-tax exposure is based on non-USD balances
held by USD functional currency entities at 31 December.
Management of interest rate risk
We are subject to risk from changes in interest rates on monetary assets and liabilities, principally cash deposits and financing costs. In respect of
our monetary assets and liabilities which earn/incur interest indexed to floating rates, as at 31 December 2023 a 100 basis point increase/decrease
in these rates, with all other variables held constant, would have resulted in a $1 million (2022: $1 million) increase/decrease in net interest expense.
15. Leasehold improvements and equipment
Accounting policy
All leasehold improvements and equipment are recorded at cost less depreciation and impairment. Cost includes the original purchase price
of the asset and costs directly attributable to bringing the asset to its working condition for its intended use. Depreciation is calculated using
the straight-line method over the asset’s estimated useful life, which for leasehold improvements is the shorter of the life of the lease and that
of the improvement (up to 24 years) and for equipment is between three and ten years.
$m
Cost at beginning of the year
Acquired through business combinations (Note 17)
Additions
Disposals
Transfer to leasehold improvements from
investment property (Note 16.1)
Cost at end of the year
Accumulated depreciation and impairment at beginning
of the year
Disposals
Transfer to leasehold improvements from
investment property (Note 16.1)
Depreciation
Accumulated depreciation and impairment at end
of the year
Net book value at beginning of the year
Net book value at end of the year
2023
2022
Leasehold
improvements
Equipment
70
–
4
(1)
–
73
(36)
–
–
(3)
61
1
8
(3)
–
67
(42)
3
–
(9)
(39)
(48)
34
34
19
19
Total
131
1
12
(4)
–
140
(78)
3
–
(12)
(87)
53
53
Leasehold
improvements
Equipment
70
–
11
(13)
2
70
(45)
13
(1)
(3)
64
–
10
(13)
–
61
(46)
13
–
(9)
(36)
(42)
25
34
18
19
Total
134
–
21
(26)
2
131
(91)
26
(1)
(12)
(78)
43
53
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
155
16. Leases
16.1. Man Group as lessee
Accounting policy
Our lease arrangements primarily relate to business premises property leases.
We assess whether a contract is or contains a lease at the inception of the contract. For arrangements where we are the lessee, a right-of-use
(ROU) lease asset and a related lease liability are recognised on the Group balance sheet at the date from which we have the right to use the
asset, usually the lease commencement date. For short-term leases (defined as leases with a term of one year or less) and leases of low-value
assets, we recognise the lease payments on a straight-line basis over the lease term within other costs in the Group income statement. The
lease term is determined as the non-cancellable period of a lease, together with periods covered by an option to extend the lease if we consider
that exercise of the extension option is reasonably certain. Lease extension options and break clauses inherent in our leases do not have a
significant impact on our ROU lease assets and lease liabilities.
ROU lease assets relating to the portion of our leased business premises which we then sub-let under operating leases are classified as
investment property, with other ROU lease assets classified as leasehold property. Transfers from investment property to leasehold property
occur when we commence development of a previously sub-let portion of our leased business premises with a view to occupying that space.
Similarly, transfers from leasehold property to investment property occur when we cease to occupy a portion of the leased business premises
with the intention of sub-letting that space under an operating lease.
All of our ROU lease assets, including those classified as investment property, are measured at cost less depreciation and impairment. Cost
includes the amount of the initial measurement of the associated lease liability, lease payments made at or before the lease commencement
date, lease incentives received, associated leasehold improvements classified as investment property and estimated costs to be incurred in
restoring the property to the condition required under the terms of the lease. Depreciation is calculated on a straight-line basis over the asset’s
estimated useful life, which for leasehold improvements classified as investment property is the shorter of the lease term and the life of the
improvement (up to 24 years) and for all other assets is the lease term and is included within other costs. We assess ROU lease assets for
impairment whenever events or circumstances indicate that the carrying amount may not be recoverable.
All lease liabilities are measured at the present value of lease payments due over the lease term, discounted using our incremental cost of
borrowing (being the rate we would have to pay to finance a similar asset) at the lease commencement date or the modification date. The lease
liability is adjusted for lease payments and unwind of lease liability discount as well as the impact of any subsequent lease modifications. The
unwind of lease liability discount is included within finance expense.
Cash payments in relation to leases, which reduce the lease liability recognised on the Group balance sheet, are presented as payment of lease
interest (within operating activities) and repayments of principal lease liability (within financing activities) in the Group cash flow statement.
Payments in relation to short-term leases and leases of low-value assets are included within cash flows from operating activities.
2023
Leasehold
property
Investment
property
2022
Leasehold
property
Investment
property
242
–
–
(141)
–
–
–
101
(171)
91
–
–
(4)
Total
411
22
3
(141)
5
–
–
300
(248)
91
–
–
(14)
169
22
3
–
5
–
–
199
(77)
–
–
–
(10)
(87)
92
112
146
–
41
(22)
–
4
–
169
(85)
22
(4)
–
(10)
(77)
61
92
256
–
2
(10)
–
(4)
(2)
242
(179)
10
4
1
(7)
Total
402
–
43
(32)
–
–
(2)
411
(264)
32
–
1
(17)
(84)
(171)
71
17
163
129
(171)
(248)
77
71
138
163
Right-of-use lease assets
$m
Cost at beginning of the year
Acquired through business combinations (Note 17)
Additions
Disposals
Remeasurement of lease liability
Transfer between leasehold property and investment property
Transfer from investment property to
leasehold improvements (Note 15)
Cost at end of the year
Accumulated depreciation and impairment at beginning
of the year
Disposals
Transfer between leasehold property and investment property
Transfer from investment property to
leasehold improvements (Note 15)
Depreciation (Note 5.2)
Accumulated depreciation and impairment at end
of the year
Net book value at beginning of the year
Net book value at end of the year
Man Group plc | Annual Report 2023
156
Financial statements
Notes to the Group financial statements continued
16. Leases continued
16.1. Man Group as lessee continued
Lease liability
The maturity of our contractual undiscounted cash flows for the lease liability is as follows:
Within one year
Between one and five years
Between five and ten years
Between ten and 15 years
Undiscounted lease liability at end of the year
Discounted lease liability at end of the year
2023
$m
32
114
142
54
342
283
Of the total discounted lease liability at 31 December 2023 of $283 million (2022: $253 million), $21 million (2022: $20 million) is expected to be
settled within 12 months.
Movements in the lease liability are as follows:
At beginning of the year
Acquired through business combinations (Note 17)
Additions
Cash payments
Unwind of lease liability discount (Note 6)
Remeasurement
Foreign exchange movements
At end of the year
16.2. Man Group as lessor
2023
$m
253
22
3
(20)
10
5
10
283
2022
$m
25
97
125
74
321
253
2022
$m
250
–
41
(23)
10
–
(25)
253
Accounting policy
Finance leases
Whenever the terms of the sub-lease transfer substantially all risks and rewards of ownership of the underlying ROU lease asset to the lessee,
we classify the contract as a finance lease. This is typically when the end of the sub-lease term aligns with the end of our head lease, with no
break option. Amounts due from lessees under finance leases are recognised as receivables at the amount of the net investment in the lease.
The net investment in the lease is measured at the present value of the lease payments due over the lease term, discounted using our
incremental cost of borrowing under the head lease. The net investment in the lease is adjusted for lease payments and finance lease interest
as well as the impact of any subsequent lease modifications. Finance lease interest is included within finance income.
Operating leases
Man Group acts as lessor in respect of certain ROU lease assets which are in turn sub-let under operating leases (investment property ROU
lease assets). Sub-leases which do not meet the definition of a finance lease are classified as operating leases. Sub-lease rental income is
recognised on a straight-line basis over the lease term in the Group income statement.
An impairment expense is recognised for the amount by which the related ROU lease asset’s carrying value exceeds its recoverable amount,
being its value in use. For the purposes of assessing impairment, investment property ROU lease assets are grouped at the lowest levels for
which there are separately identifiable cash flows, being the individual sub-lease contract level.
Sub-lease rental income from operating leases was $5 million in 2023 (2022: $5 million).
Operating expenses of $5 million (2022: $5 million) arising from investment property that did not generate rental income during the period are
included within other costs.
Fair value of investment property
Value in use
Less:
Carrying value
Headroom
Man Group plc | Annual Report 2023
2023
$m
23
(17)
6
2022
$m
82
(71)
11
Strategic report | Governance | Financial statements | Shareholder information
157
16. Leases continued
16.2. Man Group as lessor continued
In 2023, we signed new sub-leases for a substantial portion of the vacant space in our main premises in London. As the sub-leases extend to close
to the end of the head lease with no break option, they are classified as finance leases. On lease commencement, we recognised finance lease
receivables of $65 million. The derecognition of the associated ROU lease assets with a total carrying value of $53 million resulted in a gain on
disposal of $12 million, recognised in the Group income statement.
At 31 December 2023, the contractual undiscounted lease payments receivable under operating and finance leases were as follows:
$m
Within one year
Between one and two years
Between two and three years
Between three and four years
Between four and five years
Between five and ten years
Between ten and 15 years
2023
2022
Operating
leases
Finance
leases
Operating
leases
Finance
leases
2
1
–
–
–
–
–
3
–
3
5
9
10
47
17
91
5
5
5
–
–
–
–
15
–
–
–
–
–
–
–
–
At 31 December 2023, the contractual undiscounted minimum finance lease payments receivable can be reconciled to the net investment in finance
lease as follows:
Undiscounted lease payments
Less: unearned finance income
Net investment in finance lease
Movements in the net investment in finance lease are as follows:
At beginning of the year
Additions
Unwind of finance lease discount (Note 6)
Foreign exchange movements
At end of the year
17. Business combinations
2023
$m
91
(24)
67
2023
$m
–
65
1
1
67
2022
$m
–
–
–
2022
$m
–
–
–
–
–
Accounting policy
Business combinations are accounted for using the acquisition method. The consideration for the acquisition of a subsidiary is the acquisition-
date fair values of the assets transferred, the liabilities incurred, and any equity interests issued in exchange for control of the acquiree. Amounts
payable to the sellers of a business, including those contingent on the exercise of a put option, that can be forfeited in the absence of post-
acquisition services provided by those sellers are accounted for as post-acquisition remuneration and excluded from the consideration for the
acquisition of the business. The associated employment-related expenses are spread over the relevant service periods.
When the consideration transferred in a business combination includes a contingent consideration arrangement, the contingent consideration is
measured at its acquisition-date fair value. Contingent consideration classified as a liability is remeasured to fair value at each reporting date with
changes in fair value recognised in profit or loss.
At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at fair value. Acquisition-related costs are
recognised in profit or loss as incurred.
Put options held by non-controlling shareholders, which are not linked to post-acquisition employment, give rise to a financial liability, recorded
within trade and other payables at the present value of the expected redemption amount. The corresponding debit is recorded in retained
earnings. The liability is remeasured at each reporting date based on the latest assessment of the expected redemption amount, with
remeasurements recognised in profit or loss.
17.1. Acquisition of Varagon
Varagon Capital Partners, L.P. (Varagon) is a leading US middle-market private credit manager with a strong and experienced management team
and high-quality, sophisticated client base, with a particular emphasis on the insurance channel. Varagon brings significant institutional credibility
to support Man Group’s growth in US private credit.
On 6 September 2023, Man Group acquired 100% of the voting rights in Varagon, the entirety of the interest classified as equity for accounting
purposes, for upfront cash consideration of $179 million. This represents a 73% economic interest. The remaining 27% economic interest in
Varagon is held by those sellers who remain in employment for a specified period post-acquisition. The acquisition agreement includes options
which, if exercised, provide the opportunity for the rollover sellers to sell, and Man Group to buy, this remaining interest in years eight, nine or ten
post-acquisition at up to fair market value.
Man Group plc | Annual Report 2023
158
Financial statements
Notes to the Group financial statements continued
17. Business combinations continued
17.1. Acquisition of Varagon continued
Payments to the rollover sellers holding the residual 27% economic interest in Varagon may be forfeited should those sellers become ‘bad leavers’
during specified periods subsequent to the completion of the transaction. Payments in relation to the acquisition of the sellers’ interest on exercise
of the put options, and the distributions of their proportionate share of Varagon’s post-acquisition profits, are therefore recorded as employment-
related expenses. These expenses are spread, and a corresponding liability accreted, over the relevant service periods (Note 5 and Note 24).
Third-party interests in a subsidiary of Varagon, which are classified as a liability in the Group balance sheet, generated profits of $1 million for the
period post-acquisition to 31 December 2023 and are presented as third-party share of post-tax profits in the Group income statement.
The provisional values recognised at the date of acquisition were as follows:
$m
Cash and cash equivalents
Fee and other receivables
Investments in fund products and other investments
Leasehold improvements and equipment (Note 15)
Leasehold property – right-of-use lease assets (Note 16.1)
Other intangibles (Note 19)
Acquired intangibles (Note 18)
Trade and other payables
Lease liability (Note 16.1)
Third-party share of post-tax profits payable
Net assets acquired
Goodwill on acquisition (Note 18)
Total consideration
Comprising:
Cash consideration
Book value
Fair value
adjustments
Fair value
12
20
6
1
22
1
–
(29)
(22)
(1)
10
–
–
–
–
–
–
147
–
–
–
147
12
20
6
1
22
1
147
(29)
(22)
(1)
157
22
179
179
The acquisition-date values presented have been determined on a provisional basis due to the proximity of the acquisition date to the reporting date.
Fair value adjustments relate to the recognition of intangible assets comprising investment management agreements and related client relationships
($140 million) and the Varagon brand ($7 million). These intangible assets are recognised at the present value of the future cash flows expected to
be generated and are amortised on a straight-line basis over their expected useful lives of between seven and 15 years. No deferred tax liability has
been recognised on acquisition as the amortisation of intangible assets is tax-deductible in the US.
The goodwill arising from the acquisition represents the enhancement of our investment capabilities and the ability to deploy these capabilities
at scale in a customisable format to the world’s largest institutional investors. The goodwill is expected to be fully tax-deductible.
Acquisition costs of $8 million, primarily relating to professional fees, are included within other costs and do not form part of goodwill.
Revenues and pre-tax profit for the Varagon business from acquisition to 31 December 2023 were $31 million and $9 million respectively. If Varagon
had been acquired at the beginning of the year, Man Group’s total revenue and pre-tax profit for the year would have been $1,231 million and
$307 million respectively, before the deduction of employment-related expenses payable to the sellers who remain in employment post-acquisition.
17.2. Acquisition of Asteria
On 31 October 2023, Man Group acquired a controlling 51% interest in Asteria Investment Managers SA (Asteria), an ESG-oriented Swiss asset
management company, for consideration of $11 million comprising cash and contingent consideration of $8 million and $3 million respectively. The
acquisition of Asteria is part of a new strategic partnership with Fideuram-Intesa Sanpaolo Private Banking, which increases our presence in the
European intermediated retail channel. The agreement also includes options which, if exercised, provide the opportunity for Asteria’s non-controlling
shareholder to sell, and Man Group to buy, the remaining 49% interest in Asteria. The present value of the expected redemption amount of the
options, which can be exercised four years post-acquisition at fair market value, is $9 million at 31 December 2023, included within trade and other
payables in the Group balance sheet.
The contingent consideration payable for the acquisition of Asteria is based on future levels of management fees. The maximum amount payable
by Man Group is capped at $53 million.
The non-controlling interest in Asteria is measured at the proportionate share of Asteria’s identifiable net assets. As the non-controlling interest is
immaterial, the proportionate share of Asteria’s profits has been deducted from statutory profit before tax within other costs. Similarly, the non-
controlling shareholder’s share of equity has not been separately presented within the Group statement of changes in equity at 31 December 2023
and has instead been offset against the profit and loss reserve. The non-controlling interest will be separately presented in the Group financial
statements should it become material in the future.
Goodwill arising on acquisition of $8 million (Note 18) represents synergies from combining Man Group’s expertise in bespoke portfolio solutions
with access to a broader financial adviser network and client base. Acquisition costs of $1 million, primarily relating to professional fees, are included
within other costs.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
159
18. Goodwill and acquired intangibles
Accounting policy
Goodwill
Goodwill is measured as the excess of the sum of the consideration transferred and the amount of any non-controlling interest over the fair value
of the identifiable net assets of the acquired business at the date of acquisition. Goodwill is carried on the Group balance sheet at cost less
accumulated impairment, has an indefinite useful life, is not subject to amortisation and is tested for impairment annually, or whenever events or
circumstances indicate that the carrying amount may not be recoverable. An impairment expense is recognised for the amount by which the
asset’s carrying value exceeds its recoverable amount. The recoverable amount of our group of cash-generating units (CGUs) is assessed each
year using a value in use calculation.
Goodwill does not generate cash flows independently of other groups of assets and thus is assigned to a group of CGUs for the purposes of
impairment testing. Our CGUs are aggregated into a single group for impairment testing purposes, reflecting the lowest level at which goodwill
is monitored by management and which now incorporates our private market asset managers alongside our liquid asset managers.
The value in use calculation at 31 December 2023 uses cash flow projections based on the Board-approved financial plan for the three-year
period ending on 31 December 2026, plus a terminal value. The valuation analysis is based on best practice guidance whereby a terminal value
is calculated at the end of a discrete budget period and assumes, after this three-year budget period, no growth in asset flows above the long-
term growth rate.
The assumptions applied in the value in use calculation are derived from past experience and assessment of current market inputs. We have
applied a bifurcated discount rate to the modelled cash flows to reflect the different risk profile of management fee profits and performance
fee profits. The discount rates are based on our weighted average cost of capital using a risk-free interest rate, together with an equity market
risk premium and an appropriate market beta derived from consideration of our own beta, similar alternative asset managers, and the asset
management sector as a whole. The terminal value is calculated based on the projected closing AUM at 31 December 2026 and applying the
mid-point of a range of historical multiples to the forecast cash flows associated with management and performance fee profits.
The value in use calculation is presented on a post-tax basis, consistent with the prior year, given most comparable market data is available
on a post-tax basis. This is not significantly different to its pre-tax equivalent.
Acquired intangibles
Intangible assets acquired in a business combination and recognised separately from goodwill are initially measured at their fair value at the
acquisition date. Following initial recognition, acquired intangibles are held at cost less accumulated amortisation and impairment. Acquired
intangibles comprise investment management agreements and related client relationships (IMAs), distribution channels and brand names and
are initially recognised at fair value based on the present value of the expected future cash flows and are amortised on a straight-line basis over
their expected useful lives, which are between seven and 15 years (IMAs and brands), and eight and 12 years (distribution channels). Acquired
intangibles are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be
recoverable. Disposals of acquired intangibles are recognised in the year the related cash inflows are transferred.
2023
Distribution
channels
Brand
names
$m
Cost at beginning of the year
Acquired through business
combinations (Note 17)
Disposals
Cost at end of the year
Goodwill
2,425
30
–
2,455
IMAs
834
140
–
974
Total
Goodwill
3,355
2,425
177
–
3,532
–
–
2,425
40
7
–
47
56
–
–
56
(52)
(2)
(2)
–
2022
Distribution
channels
56
–
–
56
(49)
(3)
–
–
IMAs
838
–
(4)
834
(758)
(47)
–
4
Brand
names
40
–
–
40
Total
3,359
–
(4)
3,355
(38)
(1)
–
–
(2,681)
(51)
–
4
(1,836)
–
–
–
(801)
(22)
(1)
–
(39)
(1)
–
–
(2,728)
(25)
(3)
–
(1,836)
–
–
–
(1,836)
(824)
(56)
(40)
(2,756)
(1,836)
(801)
(52)
(39)
(2,728)
589
619
33
150
4
–
1
7
627
776
589
589
80
33
7
4
2
1
678
627
Accumulated amortisation
and impairment at beginning
of the year
Amortisation
Impairment
Disposals
Accumulated amortisation
and impairment at end of
the year
Net book value at beginning
of the year
Net book value at end of
the year
Man Group plc | Annual Report 2023
160
Financial statements
Notes to the Group financial statements continued
18. Goodwill and acquired intangibles continued
Goodwill impairment assumptions
Key assumptions at 31 December 2023 and 31 December 2022
Compound average annualised growth in AUM (over three years)
Discount rate
– Management fee earnings
– Performance fee earnings
Terminal value (mid-point of range of historical multiples)
– Management fee earnings
– Performance fee earnings
–
Implied terminal growth rate
Pre-tax
equivalent
Assumptions
adopted1
14%
22%
6%
11%
17%
13.0x
5.5x
3%
Goodwill impairment and sensitivity analyses
Details of the valuations are provided below, including sensitivity tables which show scenarios whereby the key assumptions are changed to
stressed assumptions, indicating the modelled headroom or impairment that would result. We have considered reasonably foreseeable changes in
the compound average annualised growth in AUM forecast assumption, stressing this by 2% and 10% or to the point at which impairment would
arise. Each assumption, or set of assumptions, is stressed in isolation. The results of these sensitivities make no allowance for mitigating actions that
management would take if such market conditions persisted.
Value in use
Less:
Carrying value of CGUs
Headroom
Sensitivity analysis at 31 December 2023
Key assumption stressed to:
Modelled headroom ($m)
Increase/(reduction) in value in use ($m)
Sensitivity analysis at 31 December 2022
Key assumption stressed to:
Modelled headroom ($m)
Increase/(reduction) in value in use ($m)
2023
$m
5,560
(880)
4,680
2022
$m
4,950
(720)
4,230
Compound average
annualised growth in AUM
Management fee/
performance fee
Management fee/
performance fee
Discount rates (post-tax)
Multiples (post-tax)
6%
4,680
4%
4,150
(530)
(4)%2 10%/16%
4,810
2,190
130
(2,490)
12%/18% 14.0x/6.5x 12.0x/4.5x
4,220
(460)
4,550
(130)
5,140
460
Compound average
annualised growth in AUM
Discount rates (post-tax)
Management fee/
performance fee
Multiples (post-tax)
Management fee/
performance fee
6%
4,230
4%
3,790
(440)
(4)%2
2,140
(2,090)
10%/16%
4,350
120
12%/18%
4,110
(120)
14.0x/6.5x
4,630
400
12.0x/4.5x
3,830
(400)
Notes:
1 Earnings discount rate assumptions are presented post-tax. Earnings multiples apply to the forward year.
2 Stressed by 10%, as opposed to the point of impairment, given an impairment scenario is not reasonably foreseeable.
Impairment of acquired intangibles
During the year, acquired intangibles with a carrying value of $3 million were fully impaired following the termination of the IMAs to which they relate.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
161
19. Other intangibles
Accounting policy
Other intangibles relate to capitalised computer software. Following initial recognition, other intangibles are held at cost less accumulated
amortisation and impairment. Cost includes costs that are directly associated with the procurement or development of identifiable and unique
software products which will generate economic benefits exceeding costs beyond one year. Capitalised computer software is amortised on a
straight-line basis over its estimated useful life (three years), with amortisation expense included within other costs in the Group income
statement. Capitalised computer software is reviewed for impairment whenever events or changes in circumstances indicate that the carrying
amount may not be recoverable. Additions primarily relate to the continued investment in our operating platforms.
Cost at beginning of the year
Acquired through business combinations (Note 17)
Additions
Disposals
Cost at end of the year
Accumulated amortisation at beginning of the year
Amortisation
Disposals
Accumulated amortisation at end of the year
Net book value at beginning of the year
Net book value at end of the year
2023
$m
148
1
25
(2)
172
(98)
(22)
2
(118)
50
54
2022
$m
130
–
27
(9)
148
(85)
(18)
5
(98)
45
50
Man Group plc | Annual Report 2023
162
Financial statements
Notes to the Group financial statements continued
20. Deferred tax
Accounting policy
Deferred tax is recognised using the balance sheet liability method in respect of temporary differences between the carrying amounts of assets
and liabilities for financial reporting purposes and the amounts used for tax purposes.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled, or the asset is realised, based
on tax laws and rates that have been enacted or substantively enacted at the reporting date.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that
sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities
when they relate to income taxes levied by the same taxation authority and we intend to settle those current tax assets and liabilities on a
net basis.
The movements in our net deferred tax assets and liabilities by category are as follows:
91
22
(7)
(1)
105
20
3
128
2022
$m
258
12
25
4
1
300
$m
At 1 January 2022
Credit/(charge) to Group income statement (Note 7)
Charge to other comprehensive income and equity
Foreign currency translation
At 31 December 2022
Credit/(charge) to Group income statement (Note 7)
Credit to other comprehensive income and equity
At 31 December 2023
Deferred
compensation
Tax
allowances
over
depreciation
Accumulated
operating
Intangibles
losses Partnerships
Other
Total
49
8
(6)
–
51
3
3
57
18
(8)
–
–
10
(8)
–
2
6
6
–
–
12
1
–
13
29
(5)
(1)
–
23
23
–
46
(22)
22
–
–
–
–
–
–
11
(1)
–
(1)
9
1
–
10
The gross amounts for which deferred tax assets have not been recognised are as follows:
United States
Switzerland
United Kingdom
Hong Kong
China
Total
2023
$m
43
64
12
4
1
124
Of the total $124 million unrecognised available gross deferred tax assets, $45 million will expire in 2024, $19 million will expire between 2027 and
2029, $43 million will expire in 2035 and $17 million have no expiry.
US deferred tax assets
We have recognised accumulated deferred tax assets in the US of $86 million (2022: $64 million) that will be available to offset future taxable profits.
As a result of an increase in forecast future taxable profits in the US following the acquisition of Varagon, we recognised an additional $19 million of
the available deferred tax assets in relation to state and city tax losses in 2023 (2022: derecognised $7 million). At 31 December 2023, $3 million
of the available US deferred tax assets (2022: $18 million) relating to state and city tax losses remain unrecognised. We do not expect to realise
sufficient future taxable profits against which these losses can be offset before the remainder expire in 2034. We do not currently expect to pay
federal tax on any profits we may earn in the US until 2026.
US net deferred tax assets
Recognised
At beginning of the year
Credit/(charge) to Group income statement:
Recognition/(derecognition) of available tax assets (Note 7)
Other movements
Charge to equity
At end of the year
Unrecognised
At beginning of the year
(Recognition)/derecognition of available tax assets (Note 7)
Other movements
At end of the year
Man Group plc | Annual Report 2023
2023
$m
2022
$m
64
19
3
–
86
18
(19)
4
3
74
(7)
–
(3)
64
11
7
–
18
Strategic report | Governance | Financial statements | Shareholder information
163
21. Provisions
Accounting policy
Provisions are recognised when Man Group has a present obligation (legal or constructive) as a result of a past event, it is probable that we will
be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. All provisions are current given we do
not have the unconditional right to defer settlement.
At beginning of the year
Charge to Group income statement
Additions
Foreign currency translation
At end of the year
Provisions relate to ongoing claims and leasehold property dilapidations.
22. Investments in associates
2023
$m
14
–
1
1
16
2022
$m
14
1
–
(1)
14
Accounting policy
Associates are entities in which Man Group holds an interest and over which we have significant influence but not control. In assessing
significant influence, we consider our power to participate in the financial and operating policy decisions of the investee through its voting
or other rights.
Associates are accounted for using the equity method. Under the equity method, associates are carried at cost plus our share of cumulative
post-acquisition movements in undistributed profits/losses. Gains and losses on transactions between Man Group and our associates are
eliminated to the extent of our interests in these entities. An impairment assessment of the carrying value of associates is performed annually
or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable, with any impairment recognised
in the Group income statement.
At beginning of the year
Acquisitions/contributions
Share of post-tax loss
At end of the year
2023
$m
14
–
(3)
11
2022
$m
18
1
(5)
14
In 2021, we acquired a 23% interest in Hub Technology Partners Ltd (HUB) for cash of $19 million and $1 million in contribution of other assets.
We do not consider HUB’s ongoing losses to be an indicator of impairment as its business remains in the development phase and is broadly
progressing in accordance with its original business plan.
Man Group plc | Annual Report 2023
164
Financial statements
Notes to the Group financial statements continued
23. Pension
Accounting policy
We operate 12 (2022: 13) defined contribution plans and two (2022: two) material funded defined benefit plans.
Defined contribution plans
We pay contributions to publicly or privately administered pension plans on a mandatory, contractual or voluntary basis. We have no further
payment obligation once the contributions have been paid. Defined contribution costs are recognised as pension costs within compensation
in the Group income statement when they are due.
Defined benefit plans
A defined benefit plan creates a financial obligation to provide funding to the pension plan to provide a retired employee with pension benefits
usually dependent on one or more factors such as age, years of service and compensation. As with the vast majority of similar arrangements,
we ultimately underwrite the risks related to the defined benefit plans. The risks to which this exposes us include:
Uncertainty in benefit payments: the value of our liabilities for post-retirement benefits will ultimately depend on the amount of benefits paid
out. This in turn will depend on the level of inflation (for those benefits that are subject to some form of inflation protection) and how long
individuals live.
Volatility in asset values: we are exposed to future movements in the values of assets held in the plans to meet future benefit payments.
Uncertainty in cash funding: movements in the values of the obligations or assets may result in us being required to provide higher levels
of cash.
The two material defined benefit plans operated are the Man Group plc Pension Fund in the UK (the UK Plan) and the Man Group Pension Plan
in Switzerland (the Swiss Plan).
– UK Plan
The UK Plan is operated separately from Man Group and managed by independent trustees. The trustees are responsible for payment of the
benefits and management of the UK Plan’s assets. Under UK regulations, Man Group and the trustees of the UK Plan are required to agree a
funding strategy and contribution schedule for the UK Plan. We have concluded that we have no requirement to adjust the balance sheet to
recognise either a current surplus or a minimum funding requirement on the basis that we have an unconditional right to a refund of a current
or projected future surplus at some point in the future.
The UK Plan was closed to new members in May 1999, to future accrual in May 2011 and has no active members.
– Swiss Plan
In Switzerland, we operate a retirement foundation whose assets are held separately from Man Group. This foundation covers the majority of
employees in Switzerland and provides benefits on a cash balance basis. Each employee has a retirement account to which the employee and
Man Group make contributions at rates set out in the plan rules based on a percentage of salary. Every year the pension fund commission
(composed of employer and employee representatives) decides the level of interest, if any, to apply to retirement accounts based on their
agreed policy. At retirement, an employee can take their retirement account as a lump sum or have this paid as a pension.
As the Swiss Plan is essentially a defined contribution plan with guarantees, the assets held aim to be at least as much as the total of the
member account balances at any point in time. Member account balances cannot reduce, but interest is only applied to the account balances
when sufficient surplus assets are available. As such, there is no specific asset/liability matching strategy in place, but if the liabilities (the sum of
the member account balances) ever exceed the value of the assets, we will consider how to remove a deficit as quickly as possible. The Swiss
Plan surplus is restricted by the value of the employer contribution reserve, which provides the asset ceiling on amounts available to Man Group.
Defined contribution plans
Defined contribution plan costs totalled $14 million for the year to 31 December 2023 (2022: $13 million).
Defined benefit plans
At 31 December 2023, the UK Plan comprised 89% (31 December 2022: 90%) of our total defined benefit pension obligations.
Present value of funded obligations
Fair value of plan assets
Net pension asset
2023
$m
(292)
304
12
2022
$m
(272)
294
22
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
165
23. Pension continued
Impact on the Group financial statements
Changes in the present value of the defined benefit obligations and the fair value of the plan assets are as follows:
$m
At beginning of the year
Amounts recognised in profit and loss:
Current service cost to employer
Interest income/(cost)
Past service cost
Running costs
Foreign exchange movements
Amounts recognised in other comprehensive income:
Remeasurements due to:
– changes in financial assumptions
– changes in demographic assumptions
– experience adjustments
– actual return on plan assets less interest
on plan assets
– adjustment due to change in asset ceiling
Employer contributions (including plan funding)
Employee contributions
Foreign currency translation
Benefit payments
At end of the year
2023
2022
Assets
Liabilities
Net pension
asset/(liability)
Assets
Liabilities
Asset ceiling
adjustment
Net pension
asset/(liability)
294
(272)
22
473
(444)
(2)
27
–
13
–
(1)
–
–
–
–
(3)
–
1
1
17
(18)
304
(1)
(12)
(1)
–
–
(9)
4
(2)
–
–
–
(1)
(16)
18
(292)
(1)
1
(1)
(1)
–
(9)
4
(2)
(3)
–
1
–
1
–
12
–
8
–
–
(49)
–
–
–
(128)
–
1
1
–
(12)
294
(1)
(8)
–
–
46
124
3
(3)
–
–
–
(1)
–
12
(272)
–
–
–
–
–
–
–
–
–
2
–
–
–
–
–
(1)
–
–
–
(3)
124
3
(3)
(128)
2
1
–
–
–
22
The allowance for the estimated cost of removing Guaranteed Minimum Pension inequalities in the UK Plan of $1 million at 31 December 2023
is unchanged from 31 December 2022.
No contributions were paid to the UK Plan in 2023 (2022: none).
Actuarial assumptions used
The most significant actuarial assumptions used in the valuations of the two plans are as follows:
Discount rate
Price inflation
Future salary increases
Pension payment increases
Deferred pensions increases
Interest crediting rate
Social security increases
Illustrative life expectancy assumptions are set out in the table below.
Years
Life expectancy of male aged 60 at year-end
Life expectancy of male aged 60 in 20 years
Life expectancy of female aged 60 at year-end
Life expectancy of female aged 60 in 20 years
UK Plan
2023
% p.a.
Swiss Plan
2022
% p.a.
2023
% p.a.
2022
% p.a.
4.5
3.1
–
3.7
5.0
–
–
4.8
3.3
–
3.7
5.0
–
–
1.5
1.2
1.2
–
–
1.5
1.0
UK Plan
Swiss Plan
2023
26.5
28.0
29.3
30.7
2022
26.9
28.4
29.7
31.1
2023
27.8
30.2
29.7
31.7
2.2
1.2
1.2
–
–
2.2
1.0
2022
27.7
30.1
29.6
31.6
The duration of a pension plan is the average term over which the plan’s benefits are expected to fall due, weighted by the present value of each
expected benefit payment. The duration of the UK Plan is approximately 12 years, and the duration of the Swiss Plan is approximately 15 years.
Sensitivity analysis
The table below illustrates the impact on the assessed value of the benefit obligations from changing the most sensitive actuarial assumptions in
isolation. The calculations have been carried out using the same method and data as our pension figures. A combination of changes in assumptions
could produce a different result.
$m
Discount rate decreased by 0.5% p.a.
Inflation rate increased by 0.5% p.a.
One-year increase in assumed life expectancy
Man Group plc | Annual Report 2023
Increase in obligation at
31 December 2023
UK Plan
Swiss Plan
16
5
10
3
–
–
166
Financial statements
Notes to the Group financial statements continued
23. Pension continued
Pension asset investments
The assets held by the two plans at 31 December 2023 are as follows:
$m
Fund investments
Liability-driven investments (LDI)
Bonds
Index-linked government bonds
Equities
Property
Cash
Other
Total assets
UK Plan
Swiss Plan
2023
82
83
52
33
–
–
23
–
273
2022
90
77
66
21
–
–
12
–
266
2023
2022
3
–
13
–
11
2
1
1
31
2
–
12
–
9
2
2
1
28
The UK Plan investment strategy is set by the trustees. The current strategy is broadly split into growth and matching portfolios. The growth portfolio
is invested in diversified growth funds and Man Diversified Risk Premia. The matching portfolio is invested primarily in government and corporate
bonds (the latter through absolute return bonds holdings), and LDI funds. The UK Plan investment strategy hedges around 100% of the movement
in the ‘technical provisions’ funding measure (as opposed to the accounting measure under IAS 19 ‘Employee Benefits’) for both interest rate and
inflation expectation changes.
Part of the investment objective of the UK Plan is to minimise fluctuations in the UK Plan’s funding levels due to changes in the value of the liabilities.
This is primarily achieved using the LDI funds, which aim to hedge movements in the pension liability due to changes in interest rate and inflation
expectations. LDI primarily involves the use of government bonds (including repurchase agreements) and derivatives such as interest rate and
inflation swaps. There are no annuities or longevity swaps. These instruments are typically priced and collateralised daily by the UK Plan’s LDI
manager and/or central clearing houses. Given that the purpose of LDI is to hedge corresponding liability exposures, the main risk is that the
investments held move differently to the liability exposures. This risk is managed by the trustees, their advisers and the UK Plan’s LDI manager,
who regularly assess the position.
A relatively volatile backdrop for interest rates and inflation over the year to December 2023 saw some significant movements of the UK Plan’s
hedging assets during the year. There was a limited impact on the UK Plan other than a fall in fund values due to the high level of hedging in early
2023. The UK Plan’s investments were rebalanced regularly, and the target hedging level of 100% of interest rates and inflation was preserved
throughout the period, with the funding level volatility relatively muted as a result. At 31 December 2023, the UK Plan’s hedging assets continued
to hedge around 100% of interest rates and inflation on the technical provisions basis. The level of leverage utilised was in line with regulatory
requirements. The UK Plan maintains a collateral waterfall and has additional sources of short-term cash from the trustee bank account, and access
to daily-dealing funds should further collateral calls be made.
The government bond assets and diversified growth funds have prices quoted in active markets and the absolute return bonds, LDI and Man
Diversified Risk Premia are primarily unquoted. At 31 December 2023, around 28% of the UK Plan assets relate to those with quoted prices
and 72% with unquoted prices (2022: around 33% quoted and 67% unquoted). The UK Plan does not invest directly in property occupied by
Man Group or our shares.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
167
24. Share-based payment schemes
Accounting policy
Man Group operates equity-settled share-based payment schemes which are remuneration payments to selected employees that take the form
of an award of shares in the Company. These typically vest over three to five years, although conditions vary between different types of award.
The fair value of the employee services received in exchange for the share awards/options granted is recognised as an expense, with the
corresponding credit recognised in equity, and is determined by reference to the fair value of the share awards/options at grant date.
We calculate the fair value of share options using the Black-Scholes valuation model, which takes into account the effect of both financial and
demographic assumptions. Forfeiture and early vesting assumptions are based on historical observable data. Changes to the original estimates,
if any, are included in the Group income statement, with a corresponding adjustment to equity.
Put options on the interests in subsidiaries held by employees which can be forfeited should they become ‘bad leavers’ are accounted for as
cash-settled share-based payments. Cash-settled share-based payments are measured at fair value on grant date and recognised as an
employment-related expense in the Group income statement over the relevant service period. They are remeasured to fair value at each
reporting date, with the change in fair value recognised as other employment-related expenses in the Group income statement. The credit
entry is recognised as a liability in the Group balance sheet within trade and other payables.
Share awards
The fair values of equity-settled share awards granted in the year and the assumptions used in the calculations are as follows:
Grant dates
Share awards granted in the year
Weighted average fair value per share award granted ($)
Deferred share plan
Executive directors' long-term incentive plan
28/02/2023 –
02/08/2023
19,200,689
3.4
11/03/2022 –
02/08/2022
21,255,153
2.6
10/03/2023 –
04/09/2023
2,784,001
3.1
11/03/2022
2,028,460
2.6
Movements in the number of equity-settled share awards outstanding are as follows:
Share awards outstanding at beginning of the year
Granted
Forfeited
Exercised
Share awards outstanding at end of the year
Share awards exercisable at end of the year
2023
2022
41,252,837
21,984,690
(2,214,057)
(18,705,570)
42,317,900
137,769
42,602,119
23,283,613
(2,363,058)
(22,269,837)
41,252,837
25,518
Share options
The fair values of share options granted in the year under the Sharesave employee share option scheme, and the assumptions used in the
calculations, are as follows:
Grant date
Weighted average share price at grant date ($)1
Weighted average exercise price at grant date ($)2
Share options granted in the period
Vesting period (years)
Expected share price volatility (%)
Dividend yield (%)
Risk-free rate (%)
Expected option life (years)
Number of options assumed to vest
Average fair value per option granted ($)
Notes:
1 Sterling share price at grant date each year of £2.06 and £2.48 respectively.
2 Sterling exercise price each year of £1.69 and £2.01 respectively.
2023
2022
11/09/2023
2.6
2.1
2,843,261
3–5
30
5
4.7
3.4
2,172,378
0.6
06/09/2022
2.9
2.3
1,440,991
3–5
30
5
0.2
3.5
1,095,521
0.7
The expected share price volatility is based on historical volatility over the past five years. The expected option life is the average expected period
to exercise. The risk-free rate of return is the yield on zero-coupon UK government bonds of a term consistent with the assumed option life.
Man Group plc | Annual Report 2023
168
Financial statements
Notes to the Group financial statements continued
24. Share-based payment schemes continued
Movements in the number of share options outstanding are as follows:
Share options outstanding at beginning of the year
Granted
Forfeited
Exercised2
Share options outstanding at end of the year
Share options exercisable at end of the year
2023
2022
Weighted
average
exercise price1
($ per share)
1.7
2.2
2.3
1.4
2.1
1.5
Weighted
average
exercise price1
($ per share)
1.6
2.4
1.6
1.5
1.7
1.6
Number
6,221,056
1,440,991
(682,302)
(1,002,968)
5,976,777
251,882
Number
5,976,777
2,843,261
(691,948)
(2,988,952)
5,139,138
361,340
Notes:
1 Calculated at 31 December exchange rates each year.
2 The sterling weighted average share price of options exercised was £2.24 (2022: £2.23) (USD-equivalent $2.73 and $2.59 respectively).
The share options outstanding at year-end had expected remaining lives as follows:
Range of exercise prices ($ per share)
0.00–3.00
2023
2022
Weighted
average
expected
remaining life
(years)
Number of
share options
Weighted
average
expected
remaining life
(years)
2.7
5,976,777
2.0
Number of
share options
5,139,138
Cash-settled share-based payments
The carrying value of the cash-settled share-based payment liability at 31 December 2023 was $23 million (2022: nil). Details of the charge in the
year and a sensitivity analysis to key assumptions is set out in Note 5.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
169
25. Share capital, Employee Trust, Treasury share reserve and earnings per share (EPS)
Accounting policy
Incremental costs directly attributable to the issue of new ordinary shares are shown in equity as a deduction from the proceeds, net of tax.
Share repurchases are recognised at the point we become committed to completing them. A liability is recognised for the full amount of the
commitment, including directly attributable costs, with a corresponding debit to equity. Where repurchased shares are held in Treasury, a
transfer from the profit and loss reserve to the Treasury share reserve is recognised for the full amount of the consideration paid. Where shares
are repurchased and subsequently cancelled, the equivalent par value by which the Company’s share capital is reduced is transferred to the
capital redemption reserve.
The Employee Trust, which is consolidated into Man Group, has the obligation to deliver deferred share-based and fund product-based
compensation granted to employees, and accordingly holds shares and fund investments to deliver against these future obligations.
Man Group plc shares held by the Employee Trust and shares held in Treasury are recorded at cost, including any directly attributable
incremental costs (net of tax), and are deducted from equity (within the respective reserves) until the shares are sold, cancelled or transferred
to employees. Where such shares are subsequently sold, any consideration received, net of any directly attributable incremental transaction
costs and the related tax effects, is included in equity.
The authorised share capital of Man Group plc comprises $100 million divided into 2,916,666,666 ordinary shares with a par value of 33/7¢ each.
Ordinary shares represent 100% of issued share capital and all issued shares are fully paid. The shares have attached to them full voting, dividend
and capital distribution (including on wind up) rights. They do not confer any rights of redemption. Shareholders have the right to receive notice of,
attend, vote and speak at general meetings. When a vote is taken on a poll, shareholders are entitled to one vote per ordinary share. When a vote
is taken by a show of hands, shareholders present in person or by proxy have one vote.
Treasury shares are ordinary shares previously repurchased by the Company but not cancelled, and are therefore deducted from equity and
included within the Treasury share reserve. As they are no longer outstanding, they are excluded for earnings per share and voting rights purposes.
Movements in the number of ordinary shares in issue and the shares used to calculate basic and diluted EPS are provided below.
2023
2022
Number of shares at beginning of year
Cancellation of own shares held in Treasury
Number of shares at end of the year
Shares held in Treasury share reserve
Man Group plc shares held by Employee Trust
Basic number of shares
Dilutive impact of:
Employee share awards
Employee share options
Dilutive number of shares
Statutory profit ($m)
Basic EPS
Diluted EPS
Share buybacks
Total
number
Weighted
average
(37,206,823)
1,350,556,782 1,350,556,782
(30,339,448)
1,313,349,959 1,320,217,334
(107,401,080)
(110,774,081)
(35,073,864)
(35,289,202)
1,167,286,676 1,177,742,390
27,671,674
1,641,378
1,207,055,442
2023
234
19.9¢
19.4¢
Shares repurchased during the year (including costs) ($m)
Average purchase price (pence)
Shares repurchased (million)
Accretive impact on diluted earnings per share (%)
Nominal
value
$m
Total
number
Weighted
average
(122,551,031)
46 1,473,107,813 1,473,107,813
(1)
(52,130,209)
45 1,350,556,782 1,420,977,604
(99,038,830)
(33,453,409)
1,236,206,167 1,288,485,365
(80,604,707)
(33,745,908)
36,356,550
2,467,128
1,327,309,043
2022
608
47.2¢
45.8¢
2023
223
241.2
76
5.2
Nominal
value
$m
51
(5)
46
2022
386
227.7
135
6.0
Man Group actively manages its capital to maximise value to shareholders by either investing that capital to improve shareholder returns in the future
or by returning it through higher dividends or share repurchases.
The $223 million of shares repurchased in the year comprise the completion of the remaining $98 million of the share repurchase programme
announced in December 2022, and the completion of the $125 million programme announced in March 2023. The purpose of the share
repurchases was to deliver returns to shareholders. All repurchased shares were held in Treasury.
Shares repurchased during the year represent 6.3% of issued share capital (excluding Treasury shares) as at 31 December 2023 and shares held in
Treasury which were cancelled during the year represent 3.1% of issued share capital (excluding Treasury shares). At 28 February 2024, we had an
unexpired authority to repurchase up to 116,279,809 of our ordinary shares. A special resolution will be proposed at the forthcoming Annual General
Meeting, pursuant to which the Company will seek authority to repurchase up to 120,265,662 ordinary shares, representing 10% of the issued share
capital (excluding Treasury shares) at 28 February 2024.
In 2023, we funded $99 million via contribution or loan (2022: $91 million) to enable the Employee Trust to meet its current period obligations.
At 31 December 2023, the net assets of the Employee Trust amounted to $196 million (2022: $146 million). These assets include 35,289,202
(2022: 33,745,908) ordinary shares in the Company, and $88 million of fund product investments (2022: $65 million) which are included within
investments in fund products.
The Employee Trust waived all dividend entitlements of the shares held in the current and prior years.
Man Group plc | Annual Report 2023
170
Financial statements
Notes to the Group financial statements continued
26. Dividends
Accounting policy
Dividend distributions to the Company’s shareholders are recognised directly within equity in the period in which the dividend is paid or, for final
dividends, approved by the Company’s shareholders. Dividends are payable on the Company’s ordinary shares.
Final dividend paid for the previous financial year to 31 December
Interim dividend paid for the six months to 30 June
Dividends paid
Proposed final dividend for the current financial year to 31 December
27. Geographical information
¢/share
10.1
5.6
10.7
2023
$m
118
63
181
125
¢/share
8.4
5.6
10.1
2022
$m
110
69
179
125
Accounting policy
Disclosure of revenue by geographic location is based on the registered domicile of the fund entity or managed account paying our fees.
Non-current assets are allocated based on where the assets are located and include goodwill and acquired intangibles, other intangibles,
leasehold improvements and equipment, and right-of-use lease assets. For goodwill and other acquired intangibles, we consider that the
location of the intangibles is best reflected by the location of the individuals managing those assets.
$m
Cayman Islands
Ireland
United Kingdom and the Channel Islands
United States of America
Other countries
2023
2022
Revenue
Non-current
assets
555
198
108
193
114
1,168
–
–
606
391
15
1,012
Revenue
956
197
217
235
127
1,732
Non-current
assets
–
–
657
228
8
893
Revenue from no single fund exceeded 10% of total annual revenue in 2023. In 2022, revenue from one fund of $213 million exceeded 10% of total
annual revenue driven by high levels of performance fees crystallising during the year. Excluding performance fees, revenue from no single fund
exceeded 10% of revenue in 2022.
28. Related party transactions
Accounting policy
Related parties comprise key management personnel, associates and fund entities which we are deemed to control. All transactions with related
parties were carried out on an arm’s-length basis.
The Executive Committee, together with the Company’s non-executive directors, are considered to be our key management personnel, being those
directors, partners and employees having authority and responsibility for planning, directing and controlling our activities.
Key management compensation
Salaries and other short-term employee benefits1
Share-based payment charge
Fund product-based payment charge
Pension costs (defined contribution)
Total
Note:
1
Includes salary, benefits and cash bonus.
29. Other matters
2023
$m
31
19
22
1
73
2022
$m
80
24
21
1
126
In July 2019, the Public Institution for Social Security in Kuwait (PIFSS) served a claim against a number of parties, including certain Man Group
companies, a former employee of Man Group and a former third-party intermediary. The subject matter of these allegations dates back over a period
of 20 years. PIFSS is seeking compensation of $156 million (plus compound interest) and certain other remedies which are unquantified in the claim.
We dispute the allegations and consider there is no merit to the claim (in respect of liability and quantum) and will therefore vigorously and robustly
defend the proceedings.
We are subject to various other claims, assessments, regulatory enquiries and investigations in the normal course of business. The Board does not
expect such matters to have a material adverse effect on our financial position.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
171
30. Unconsolidated structured entities
Accounting policy
We have evaluated all exposures and concluded that where we hold an investment, fee receivable, accrued income, or commitment with an
investment fund or a CLO, this represents an interest in a structured entity as defined by IFRS 12 ‘Disclosure of Interests in Other Entities’.
Investment funds are designed so that their activities are not governed by way of voting rights, and contractual arrangements are the dominant
factor in affecting an investor’s returns. The activities of these entities are governed by investment management agreements or, in the case of
CLOs, indentures.
Our maximum exposure to loss from unconsolidated structured entities is the sum total of any investment held, fee receivables and
accrued income.
Our interest in and exposure to unconsolidated structured entities is as follows:
2023
Alternative
Absolute return
Total return
Multi-manager solutions
Long-only
Systematic
Discretionary
Total
2022
Alternative
Absolute return
Total return
Multi-manager solutions
Long-only
Systematic
Discretionary
Total
Less infrastructure
mandates and
consolidated
fund entities1
($bn)
Total AUM
unconsolidated
structured
entities
($bn)
Net
management
fee margin2
(bps)
Fair value of
investment
held
($m)
Number
of funds
Fee
receivables
and accrued
income
($m)
Maximum
exposure
to loss
($m)
(0.3)
(1.3)
(12.8)
–
(0.2)
(14.6)
47.4
41.2
6.6
36.5
21.2
152.9
123
88
51
84
56
402
112
64
17
24
59
130
137
3
4
15
289
158
60
14
36
22
290
288
197
17
40
37
579
Less infrastructure
mandates and
consolidated
fund entities1
($bn)
Total AUM
unconsolidated
structured
entities
($bn)
Net
management
fee margin2
(bps)
Fair value of
investment
held
($m)
Number
of funds
Fee
receivables
and accrued
income
($m)
Maximum
exposure
to loss
($m)
(0.3)
(0.2)
(12.5)
(0.2)
(0.2)
(13.4)
45.7
28.6
7.7
31.4
16.5
129.9
107
80
54
73
61
375
112
63
20
25
57
108
168
3
5
19
303
284
40
14
31
21
390
392
208
17
36
40
693
Total
AUM
($bn)
47.7
42.5
19.4
36.5
21.4
167.5
Total
AUM
($bn)
46.0
28.8
20.2
31.6
16.7
143.3
Notes:
1 For infrastructure mandates where we do not act as investment manager or adviser, our role in directing investment activities is diminished and therefore these are not considered structured entities.
2 Net management fee margins are the categorical weighted average. Performance fees can only be earned after a high-water mark is achieved.
Man Group plc | Annual Report 2023
172
Financial statements
Notes to the Group financial statements continued
31. Group investments
Details of the Company’s subsidiaries are provided below. The list excludes consolidated structured entities on the basis that, although these are
consolidated for the purposes of IFRS, they are not within the legal ownership of Man Group. The country of operation is the same as the country
of incorporation and the year-end is 31 December, unless otherwise stated. The effective Group interest represents both the percentage held and
voting rights of ordinary shares or common stock (or the local equivalent thereof), unless otherwise stated.
Registered address
22 Grenville Street, St Helier, Jersey, JE4 8PX
Country of
incorporation
Jersey
Direct or
indirect
Country of
incorporation
Effective Group
interest %
Parent company
Company name
Man Group plc
Subsidiaries
Company name
Man Group Treasury Limited
AHL Partners LLP1,2
Asteria Investment Managers SA
FA Sub 3 Limited
GLG Capital Management LLC3
GLG LLC3
GLG Partners Limited
GLG Partners LP2
GPM Summit Point GP LLC3
Man Asset Management (Cayman) Limited
Registered address
22 Grenville Street, St Helier, Jersey, JE4 8PX
Riverbank House, 2 Swan Lane, London, EC4R 3AD
Rue de Lausanne 15, 1201 Geneva, Switzerland
Ritter House, Wickhams Cay II, Road Town,
Tortola, VG1110
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
Riverbank House, 2 Swan Lane, London, EC4R 3AD
Riverbank House, 2 Swan Lane, London, EC4R 3AD
4001 Kennett Pike, Suite 302, Wilmington DE 19807
PO Box 309, Ugland House, South Church Street,
George Town, Grand Cayman, KY1-1104
Man Asset Management (Ireland) Limited
Man Australia GP Limited
Man Australia LP2
70 Sir John Rogerson’s Quay, Dublin 2
Riverbank House, 2 Swan Lane, London, EC4R 3AD
Level 28, Chifley Tower, 2 Chifley Square, Sydney,
NSW 2000
Man (Europe) AG
Man Fund Management Netherlands BV
Austrasse 56, 9490, Vaduz, Liechtenstein
Beurs – World Trade Center, Beursplein 37,
Man Fund Management UK Limited
Man GLG Partners LLP1,2
Man Global Private Markets (UK) Limited
Man Global Private Markets (USA) Inc.
Man Global Private Markets SLP LLC3
Man Group Holdings Limited4
Man Group Investments Limited
Man Group Japan Limited
Man Group Limited
Man Group Operations Limited
Man Group Services Limited
Man Group UK Limited
Man Investments AG
Man Investments Australia Limited
3011 AA, Rotterdam
Riverbank House, 2 Swan Lane, London, EC4R 3AD
Riverbank House, 2 Swan Lane, London, EC4R 3AD
Riverbank House, 2 Swan Lane, London, EC4R 3AD
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
Riverbank House, 2 Swan Lane, London, EC4R 3AD
Riverbank House, 2 Swan Lane, London, EC4R 3AD
PO Box 556, 1st Floor, Les Echelons Court, Les Echelons,
South Esplanade, St Peter Port, GY1 6JB, Guernsey
Riverbank House, 2 Swan Lane, London, EC4R 3AD
Riverbank House, 2 Swan Lane, London, EC4R 3AD
Riverbank House, 2 Swan Lane, London, EC4R 3AD
Riverbank House, 2 Swan Lane, London, EC4R 3AD
Huobstrasse 3, 8808 Pfäffikon SZ
Level 28, Chifley Tower, 2 Chifley Square, Sydney,
NSW 2000
Man Investments (CH) AG
Man Investments Finance Limited
Man Investments Finance Inc.
Man Investments Holdings (Netherlands) B.V. Beurs – World Trade Center, Beursplein 37,
Huobstrasse 3, 8808 Pfäffikon SZ
Riverbank House, 2 Swan Lane, London, EC4R 3AD
4001 Kennett Pike, Suite 302, Wilmington DE 19807
3011 AA, Rotterdam
Jersey
Direct
UK
Indirect
Indirect Switzerland
BVI
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect
US
US
UK
UK
US
Cayman
Ireland
UK
Australia
Indirect Liechtenstein
Indirect Netherlands
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect
UK
UK
UK
US
US
UK
UK
Guernsey
UK
Indirect
UK
Indirect
UK
Indirect
Indirect
UK
Indirect Switzerland
Australia
Indirect
Indirect Switzerland
UK
Indirect
Indirect
US
Indirect Netherlands
Man Investments Holdings Inc.
Man Investments (Hong Kong) Limited
4001 Kennett Pike, Suite 302, Wilmington DE 19807
Unit 2206-2207, 22/F Man Yee Building, No.68
Indirect
US
Indirect Hong Kong
Des Voeux Road, Central
Man Investments Inc.
Man Investments Limited
Man Investment Management (Shanghai)
15 North Mill Street, Nyack, NY 10960, United States
Riverbank House, 2 Swan Lane, London, EC4R 3AD
Room 1817 Bund Centre, No. 222 Yan An East Road,
Indirect
Indirect
Indirect
US
UK
China
Co., Ltd
Shanghai, 200002
Man Investments (Shanghai) Limited
Room 1818, Bund Centre, No. 222 Yan An East Road,
Indirect
China
Man Investments (USA) Corp.
Man Investments USA Holdings Inc.
Man Property Holdings Limited
Man Solutions Limited
Man Solutions LLC3 (formerly FRM
Investment Management (USA) LLC)
Man Group plc | Annual Report 2023
Shanghai, 200002
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
22 Grenville Street, St Helier, Jersey, JE4 8PX
Riverbank House, 2 Swan Lane, London, EC4R 3AD
4001 Kennett Pike, Suite 302, Wilmington DE 19807
Indirect
Indirect
Indirect
Indirect
Indirect
US
US
Jersey
UK
US
100
100
51
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
Strategic report | Governance | Financial statements | Shareholder information
173
31. Group investments continued
Subsidiaries continued
Company name
Man Solutions (USA) LLC3
Man Strategic Holdings Limited
Man Times Square GP LLC3,5
Man Times Square Holdings LLC3,5
Man Worldwide Operations
Management Limited
Mount Granite Limited
MVH Lending, LLC3,5
Net Zero Energy SFR GP Inc.
Numeric Holdings LLC3
Numeric Investors LLC3
Silvermine Capital Management LLC3
Varagon Capital Access SPV I, LLC3,5
Varagon Capital Partners Agent, LLC3,5
Varagon Capital Partners, L.P. 2,5
Varagon Professionals Fund GP, LLC3,5
VCAP Onshore GP, LLC3,5
VCAP Offshore GP, S.à.r.l5
VCC Advisors, LLC5
VCDLF SLP, LLC3,5
VCN GP, LLC3,5
VCN, L.P.2,5
VCP Holding I GP, LLC3,5
VCP Holding II GP, LLC3,5
VIVA Onshore GP, LLC3,5
VSN Parallel Fund GP, LLC3,5
VSN Parallel Fund, L.P.2,5
Registered address
4001 Kennett Pike, Suite 302, Wilmington DE 19807
Riverbank House, 2 Swan Lane, London, EC4R 3AD
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
22 Grenville Street, St Helier, Jersey, JE4 8PX
Wickhams Cay, PO Box 662, Road Town, Tortola
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
10, Rue des Capucins, L-1313 Luxembourg
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
4001 Kennett Pike, Suite 302, Wilmington DE 19807
Direct or
indirect
Indirect
Indirect
Indirect
Indirect
Indirect
Country of
incorporation
US
UK
US
US
Jersey
Effective Group
interest %
100
100
73.11
73.11
100
BVI
Indirect
US
Indirect
US
Indirect
US
Indirect
US
Indirect
US
Indirect
US
Indirect
US
Indirect
US
Indirect
US
Indirect
Indirect
US
Indirect Luxembourg
US
Indirect
US
Indirect
US
Indirect
US
Indirect
US
Indirect
US
Indirect
US
Indirect
US
Indirect
US
Indirect
100
73.11
100
100
100
100
73.11
73.11
73.11
73.11
73.11
73.11
50.46
73.11
73.11
73.11
73.11
73.11
73.11
73.11
73.11
Subsidiaries in liquidation/dissolution
Company name
Registered address
Man Mash Limited
Man Principal Strategies Corp
FA Sub 2 Limited
Riverbank House, 2 Swan Lane, London, EC4R 3AD
4001 Kennett Pike, Suite 302, Wilmington DE 19807
Ritter House, Wickhams Cay II, Road Town,
Tortola, VG1110
GLG Holdings Limited
Man Investments Holdings (Jersey) Limited
Financial Risk Management Limited
Man Valuation Services Limited
Man Investments Holdings Limited
Wickhams Cay, PO Box 662, Road Town, Tortola
15 Esplanade, St Helier, JE1 1RB
Riverbank House, 2 Swan Lane, London, EC4R 3AD
Riverbank House, 2 Swan Lane, London, EC4R 3AD
Riverbank House, 2 Swan Lane, London, EC4R 3AD
Direct or indirect
Country of
incorporation
Effective Group
interest %
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect
UK
US
BVI
BVI
Jersey
UK
UK
UK
100
100
100
100
100
100
100
100
Related undertakings other than subsidiaries
Company name
Registered address
Hub Platform Technology Partners Ltd
PR-Man Summit Point Holdings LP2
71-75 Shelton Street, Covent Garden, London, WC2H 9JQ
1209 Orange Street, Wilmington DE 19801
Country of
incorporation
UK
US
Interest %
22.86
5
Notes:
1 The financial year-end is 31 March, which aligns with the tax year of the individual partners.
2 Partnership interest.
3 Member interest.
4 Holdings comprise ordinary and deferred shares.
5 100% of the voting rights (see Note 17).
Man Group plc | Annual Report 2023
174
Financial statements
Five-year record
Income statement ($m)
Core net management fee revenue
Core performance fees
Core profit before tax
Core management fee profit before tax
Core performance fee profit before tax
Core profit
Statutory profit before tax
Statutory profit
Statutory EPS (diluted)
Core EPS (diluted)
Core management fee EPS (diluted)
Balance sheet ($m)
Net cash and cash equivalents
Net assets
Net financial assets
Other metrics
Core cash flows from operating activities before working capital movements
($m)
Ordinary dividends per share (¢)
AUM ($bn)
Average headcount
USD/sterling exchange rates:
Average
Year-end
2023
2022
2021
2020
2019
963
180
340
280
60
271
279
234
19.4¢
22.4¢
18.4¢
136
1,612
555
362
16.3
167.5
1,716
927
779
779
290
489
647
745
608
45.8¢
48.7¢
18.4¢
457
1,699
983
810
15.7¢
143.3
1,595
877
569
658
266
392
557
590
487
33.8¢
38.7¢
15.7¢
387
1,651
907
700
14.0¢
148.6
1,453
730
179
284
180
104
240
179
138
9.3¢
16.2¢
10.3¢
351
1,497
716
341
10.6¢
123.6
1,456
751
325
384
170
214
325
307
285
18.4¢
21.0¢
9.7¢
281
1,624
674
385
9.8¢
117.7
1,413
0.8042
0.7855
0.8081
0.8276
0.7267
0.7390
0.7789
0.7315
0.7830
0.7544
‘Core’ measures are alternative performance measures. Further details of our alternative performance measures, including non-core items, are set
out on pages 175 to 179.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
175
Alternative performance measures
We assess our performance using a variety of alternative performance measures (APMs). We discuss our results on a statutory as well as a ‘core’
basis. Core metrics, which are each APMs, exclude acquisition and disposal-related items, significant non-recurring items and volatile or
uncontrollable items, as well as profits or losses generated outside of our investment management business. Accordingly, these core metrics reflect
the way in which performance is monitored by the Board and present the profits or losses which drive our cash flows and inform the way in which
our variable compensation is assessed. Details of the non-core items in the year are set out below.
Our APMs also reclassify all income and expenses relating to our consolidated fund entities, which are required by IFRS to be split across multiple
lines in the Group income statement, to core gains/losses on investments in order to reflect their performance as part of our seed book programme.
Tax on non-core items and movements in deferred tax relating to the utilisation or recognition of tax assets in the US are similarly excluded from core
profit, with tax on core profit considered a proxy for cash taxes paid.
In the year, accounting for the acquisition of Varagon in accordance with the requirements of IFRS has resulted in the recognition of all future
payments to selling shareholders who remain in employment post-acquisition as employment-related expenses. This arises because each of these
payments can be forfeited should those employees become ‘bad leavers’ during specified periods following the acquisition. Economically, the
payments are transactions with the individuals in their capacity as owners. Recognising that these owners also hold significant roles in the
organisation, the ‘bad leaver’ clauses were protective in nature and not intended to compensate the individuals for employment services.
As these transactions are related to an acquisition, we consider it appropriate to adjust the expense recognised in the year to reflect the proportion
of the profits which have been generated in the same period and are attributable to these employees through an adjustment to core profit. This more
closely aligns the charges with the associated cash flows.
The approach to the classification of non-core items maintains symmetry between losses and gains and the reversal of any amounts previously
classified as non-core. Note that our APMs may not be directly comparable with similarly titled measures used by other companies.
Non-core items in profit before tax comprise the following:
Acquisition and disposal related:
Amortisation and impairment of acquired intangibles
Acquisition-related costs
Other employment-related expenses1
Share of post-tax loss of associates
Gain on disposal of investment property – right-of-use lease assets
Other costs – claims
Foreign exchange movements
Non-core items
Note:
1 Adjustment to align acquisition-related employment-related expenses with proportionate share of earnings in the year.
Note to the
Group financial
statements
2023
$m
2022
$m
18
17
5.1
22
16.2
5.2
12.1
(28)
(9)
(21)
(3)
12
(1)
(11)
(61)
(51)
–
–
(5)
–
–
22
(34)
Man Group plc | Annual Report 2023
176
Financial statements
Alternative performance measures continued
Core measures: reconciliation to statutory equivalents
The statutory line items within the Group income statement can be reconciled to their core equivalents as follows:
2023
$m
Management and other fees[APM]
Performance fees[APM]
Revenue[APM]
Net income or gains on investments and other financial instruments[APM]
Third-party share of gains relating to interests in consolidated funds
Rental income
Distribution costs
Net revenue[APM]
Asset servicing costs
Compensation costs
Other employment-related expenses[APM]
Other costs[APM]
Net finance expense
Gain on disposal of investment property – right-of-use lease assets
Amortisation and impairment of acquired intangibles
Share of post-tax loss of associate
Third-party share of post-tax profits
Profit before tax[APM]
Tax expense[APM]
Profit[APM]
Core basic EPS
Core diluted EPS
2022
$m
Reclassification
of amounts relating
to consolidated
fund entities
Core measure
Non-core items
Per Group income
statement
(5)
(2)
(7)
39
(24)
1
–
9
–
–
–
(9)
–
–
–
–
–
–
–
–
–
–
–
(11)
–
–
–
(11)
–
–
(21)
(10)
–
12
(28)
(3)
–
(61)
24
(37)
990
178
1,168
76
(24)
6
(32)
1,194
(58)
(595)
(23)
(198)
(21)
12
(28)
(3)
(1)
279
(45)
234
995
180
1,175
48
–
5
(32)
1,196
(58)
(595)
(2)
(179)
(21)
–
–
–
(1)
340
(69)
271
23.0¢
22.4¢
Reclassification
of amounts relating
to consolidated
fund entities
Core measure
Non-core items
Per Group income
statement
Management and other fees[APM]
Performance fees[APM]
Revenue[APM]
Net income or gains on investments and other financial instruments[APM]
Third-party share of losses relating to interests in consolidated funds
Rental income
Distribution costs
Net revenue[APM]
Asset servicing costs
Compensation costs
Other costs[APM]
Net finance expense
Amortisation of acquired intangibles
Share of post-tax loss of associate
Profit before tax[APM]
Tax expense[APM]
Profit[APM]
Core basic EPS
Core diluted EPS
958
779
1,737
(15)
–
5
(31)
1,696
(58)
(678)
(170)
(11)
–
–
779
(132)
647
50.2¢
48.7¢
(4)
(1)
(5)
–
14
–
–
9
–
–
(9)
–
–
–
–
–
–
–
–
–
22
–
–
–
22
–
–
–
–
(51)
(5)
(34)
(5)
(39)
954
778
1,732
7
14
5
(31)
1,727
(58)
(678)
(179)
(11)
(51)
(5)
745
(137)
608
[APM] The core equivalents of these statutory measures are defined as alternative performance measures.
Core costs comprise asset servicing, compensation costs, core other employment-related expenses, core other costs and third-party share of post-
tax profits.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information
177
Core measures: reconciliation to statutory equivalents continued
The statutory line items within the Group balance sheet can be reconciled to their core equivalents as follows:
2023
$m
Assets
Cash and cash equivalents[APM]
Fee and other receivables[APM]
Investments in fund products and other investments[APM]
Investments in associates
Current tax asset
Finance lease receivable
Leasehold improvements and equipment
Leasehold property – right-of-use lease assets
Investment property – right-of-use lease assets
Investment property – consolidated fund entities
Other intangibles
Deferred tax assets
Pension asset
Goodwill and acquired intangibles
Total assets
Liabilities
Borrowings
Trade and other payables[APM]
Provisions
Current tax liabilities
CLO liabilities – consolidated fund entities
Third-party interest in consolidated funds
Third-party interest in other subsidiaries
Lease liability
Total liabilities
Net assets
2022
$m
Assets
Cash and cash equivalents[APM]
Fee and other receivables[APM]
Investments in fund products and other investments[APM]
Investments in associates
Leasehold improvements and equipment
Leasehold property – right-of-use lease assets
Investment property – right-of-use lease assets
Investment property – consolidated fund entities
Other intangibles
Deferred tax assets
Pension asset
Goodwill and acquired intangibles
Total assets
Liabilities
Trade and other payables[APM]
Provisions
Current tax liabilities
Third-party interest in consolidated funds
Lease liability
Total liabilities
Net assets
[APM] The core equivalents of these statutory measures are defined as alternative performance measures.
Man Group plc | Annual Report 2023
Reclassification of
amounts relating to
consolidated
fund entities
Core measure
Per Group
balance sheet
180
463
787
11
15
67
53
112
17
–
54
128
12
776
2,675
140
620
16
3
–
–
1
283
1,063
1,612
96
88
1,492
–
–
–
–
–
–
30
–
–
–
–
1,706
–
116
–
–
1,036
554
–
–
1,706
276
551
2,279
11
15
67
53
112
17
30
54
128
12
776
4,381
140
736
16
3
1,036
554
1
283
2,769
–
1,612
Reclassification of
amounts relating
to consolidated
fund entities
Per Group
balance sheet
Core measure
349
541
841
14
53
92
71
–
50
105
22
627
2,765
762
14
37
–
253
1,066
1,699
108
29
368
–
–
–
–
34
–
–
–
–
539
180
–
–
359
–
539
–
457
570
1,209
14
53
92
71
34
50
105
22
627
3,304
942
14
37
359
253
1,605
1,699
178
Financial statements
Alternative performance measures continued
Core management fee profit and core performance fee profit
Core profit comprises core management fee profit, a steadier earnings stream, and core performance fee profit, a more variable earnings stream.
This split facilitates analysis of our profitability drivers.
2023
$m
Management and other fees
Distribution costs
Net management fee revenue
Rental income
Asset servicing costs
Compensation costs (management fee)
Other employment-related expenses
Other costs
Net finance expense (management fee)
Third-party share of post-tax profits
Management fee profit before tax
Tax expense
Management fee profit
Core basic management fee EPS
Core diluted management fee EPS
Performance fees
Net income or gains on investments and other financial instruments
Compensation costs (performance fee)
Net finance expense (performance fee)
Performance fee profit before tax
Tax expense
Performance fee profit
Core basic performance fee EPS
Core diluted performance fee EPS
2022
$m
Management and other fees
Distribution costs
Net management fee revenue
Rental income
Asset servicing costs
Compensation costs (management fee)
Other costs
Net finance expense (management fee)
Management fee profit before tax
Tax expense
Management fee profit
Core basic management fee EPS
Core diluted management fee EPS
Performance fees
Net income or gains on investments and other financial instruments
Compensation costs (performance fee)
Net finance expense (performance fee)
Performance fee profit before tax
Tax expense
Performance fee profit
Core basic performance fee EPS
Core diluted performance fee EPS
Man Group plc | Annual Report 2023
Reclassification of
amounts relating to
consolidated
fund entities
Core measure
Non-core items
Per Group
income statement
(5)
–
(5)
1
–
–
–
(9)
–
–
(13)
(2)
39
–
–
37
–
–
–
–
–
–
(21)
(10)
–
–
(31)
–
(11)
–
–
(11)
990
(32)
958
6
(58)
(439)
(23)
(198)
(9)
(1)
236
178
76
(156)
(12)
86
995
(32)
963
5
(58)
(439)
(2)
(179)
(9)
(1)
280
(58)
222
18.8¢
18.4¢
180
48
(156)
(12)
60
(11)
49
4.2¢
4.0¢
Reclassification of
amounts relating to
consolidated
fund entities
Core measure
Non-core items
Per Group
income statement
(4)
–
(4)
–
–
–
(9)
–
(13)
(1)
–
–
–
(1)
–
–
–
–
–
–
–
–
–
–
22
–
–
22
954
(31)
923
5
(58)
(406)
(179)
(8)
277
778
7
(272)
(3)
510
958
(31)
927
5
(58)
(406)
(170)
(8)
290
(46)
244
19.0¢
18.4¢
779
(15)
(272)
(3)
489
(86)
403
31.2¢
30.3¢
Strategic report | Governance | Financial statements | Shareholder information
179
Core gains/losses on investments
We use the measure core gains/losses on investments to represent the net return we receive on our seeding investments portfolio, combining both
consolidated and unconsolidated fund entities on a consistent basis. We therefore exclude from this measure gains or losses on investments which
do not relate to the performance of the seed book and adjust the amounts relating to consolidated funds to be included in this line on a consistent
basis. Core gains/losses on investments can be reconciled to the Group income statement as follows:
Net gains/(losses) on seeding investments portfolio
Net gains/(losses) on fund investments held for deferred compensation arrangements
and other investments
Core gains/(losses) on investments
Non-core items:
Consolidated fund entities: gross-up of net gains on investments
Foreign exchange movements
Net income or gains on investments and other financial instruments
Core tax rate
Note to the
Group financial
statements
12.1
12.1
12.1
12.1
2023
$m
47
1
48
39
(11)
76
2022
$m
(12)
(3)
(15)
–
22
7
The core tax rate is the effective tax rate on core profit before tax and is equal to the tax on core profit divided by core profit before tax. The tax
expense on core profit before tax is calculated by excluding the tax benefit/expense related to non-core items from the statutory tax expense,
together with amounts relating to the utilisation or recognition of available US deferred tax assets. Therefore, tax on core profit is considered a proxy
for our cash taxes payable.
The impact of non-core items on our tax expense is outlined below:
Statutory tax expense
Tax on non-core items:
Amortisation and impairment of acquired intangibles
Gain on disposal of investment property – right-of-use lease assets
Foreign exchange movements
Non-core tax item on US deferred tax assets
Core tax expense
Comprising:
Tax expense on core management fee profit before tax
Tax expense on core performance fee profit before tax
2023
$m
45
2
(3)
3
22
69
58
11
2022
$m
137
6
–
(4)
(7)
132
46
86
The core tax rate is 20% for 2023 (2022: 17%). The increase in the rate is largely due to the increase in the UK corporation tax rate on 1 April 2023
to 25% from 19%.
Core cash flows from operations excluding working capital movements
Cash flows from operating activities excluding working capital movements can be reconciled to cash flows from operating activities as reported
in the Group cash flow statement as follows:
Cash flows from operating activities
Plus changes in working capital:
(Decrease)/increase in fee and other receivables
(Decrease)/increase in other financial assets
Decrease/(increase) in trade and other payables
Core cash flows from operations excluding working capital movements
Net financial assets
Note to the
Group financial
statements
9
2023
$m
337
(104)
(71)
200
362
Net financial assets is considered a proxy for Group capital, and is equal to our cash and seed book less borrowings, contingent consideration
payable, liabilities for put options over non-controlling and employee interests and payables under repo arrangements, as follows:
Seeding investments portfolio
Available cash and cash equivalents
Borrowings
Contingent consideration payable
Put option over non-controlling interests in subsidiaries
Put option over employee interests in subsidiaries
Payables under repo arrangements
Net financial assets
Man Group plc | Annual Report 2023
Note to the
Group financial
statements
12
8
8
11
11
24
11
2023
$m
595
180
(140)
(3)
(9)
(23)
(45)
555
2022
$m
737
68
45
(40)
810
2022
$m
688
349
–
–
–
–
(54)
983
180
Shareholder information
In this section we have provided some key
information to assist you in managing your
shareholding in Man Group. If you have a
question that is not answered below, please
contact us at: shareholder@man.com
Man Group (www.man.com)
The Man Group website contains a wealth of information about the
Company, including details of the industry in which we operate, our
strategy and business performance, recent news from Man Group
and corporate responsibility initiatives. The Investor Relations section
is a key tool for shareholders with information on share price and
financial results, reports and presentations. This section of the website
also contains information on dividends and shareholder meeting
details as well as useful Frequently Asked Questions.
EQ Shareview (www.shareview.co.uk/shareholders)
Man Group’s register of shareholders is maintained by EQ, the
Company’s Registrars. Many aspects of managing your shares, such
as checking your current shareholding, managing dividend payments,
and updating your contact details, can be carried out by registering on
the EQ Shareview website. To do this you will need your Shareholder
Reference, which can be found on your share certificate or dividend
confirmation.
Dividends
Final dividend for the year ended 31 December 2023
10.7¢ per share
The directors have recommended a final dividend of 10.7 cents per
share in respect of the year ended 31 December 2023. Payment
of this dividend is subject to approval at the 2024 Annual General
Meeting (AGM). Key dates relating to this dividend are given below:
Ex-dividend date
Record date
DRIP election date
AGM (to approve final dividend)
Sterling conversion date
Payment date
CREST accounts credited with DRIP shares
DRIP share certificates received
11 April 2024
12 April 2024
30 April 2024
9 May 2024
9 May 2024
22 May 2024
28 May 2024
29 May 2024
Dividend policy
Man Group’s ordinary dividend policy is progressive, taking into
account the growth in Man Group’s overall earnings. In addition,
the Group expects to generate significant capital over time. Available
capital, after taking into account our required capital and potential
strategic opportunities, will be distributed to shareholders over time
through higher dividend payments and/or share repurchases.
The Company will fix the dividend currency conversion rate on 9 May
2024. The achieved sterling rate will be announced at this time, in
advance of the payment date.
Dividend payment methods
You can choose to receive your dividend in a number of ways.
Dividends will automatically be paid to you by cheque and sent to your
registered address unless you have chosen one of the options below:
1. Direct payment to your bank: We recommend that you apply
for cash dividends to be paid directly into your UK bank or building
society account to speed up the payment process and to avoid
the risk of cheques becoming lost or delayed in the post. The
associated dividend confirmation will be sent direct to your
registered address. To switch to this method of payment simply
download a dividend mandate form from the Dividends section
of our website. Alternatively, dividend mandate forms are available
from the EQ Shareview website. If you have any queries please
contact EQ on 0371 384 21121 who will be able to assist.
2. Overseas payment service2: If you live overseas, EQ offers an
overseas payment service which is available in certain countries.
This may make it possible to receive dividends directly into your
bank account in your local currency. Further information can be
found on the EQ Shareview website or via the EQ helpline 0371
384 21121. When calling from outside the UK please ensure the
country code is used.
3. Dividend Reinvestment Plan (DRIP): The Company is
pleased to offer a DRIP, which gives shareholders the opportunity
to build their shareholding in the Company in a convenient and
cost effective way. Instead of receiving your dividend in cash,
you receive as many whole shares as can be bought with your
dividend, taking into account related purchase costs; any residual
cash is then carried forward and added to your next dividend.
If you wish to join the DRIP, you can download copies of the
DRIP terms and conditions and the DRIP mandate form from
the Dividends section of the Man Group website. Simply complete
the DRIP mandate form and return it to EQ. Should you have
any questions regarding the DRIP, or to request a paper mandate
form, please contact EQ on 0371 384 21121. Please note that if you
wish to join the DRIP in time for the payment of the forthcoming
final dividend for the year ended 31 December 2023, EQ must
have received your instruction by 5.00pm on 30 April 2024.
Instructions received after this date will be applied to the
next dividend payment.
1 Lines are open from 8.30am to 5.30pm, each business day. When calling from outside the UK,
please ensure the country code is used.
2 Please note that a payment charge will be deducted from each individual payment before
conversion to your local currency.
Man Group plc | Annual Report 2023
Shareholder information 181
Dividend history
To help shareholders with their tax affairs, details of dividends paid in the 2023/24 tax year can be found below. Please note that the dividend
amounts are declared in US dollars but paid in sterling. For ease of reference the sterling dividend amounts have been detailed in the table.
For details of historical payments, please refer to the Dividends section of our website, which can be found at www.man.com/investor-relations.
Dividend no
0/33
0/32
Payment
date
22/09/23
19/05/23
Amount per
share (p)
4.42
8.07
Ex-dividend
date
10/8/23
06/4/23
Record
date
11/08/23
11/04/23
DRIP
share price (p)
216.45
220.8133
DRIP
purchase date
22/09/23
22/05/23
Be a ScamSmart investor – avoid investment and
pension scams
Even seasoned investors have been caught out by sophisticated
share or investment scams where smooth-talking fraudsters cold
call from ‘boiler rooms’ to offer them worthless, overpriced or even
non-existent shares, or to buy shares they currently hold at a price
higher than the market value. All shareholders are advised to be
extremely wary of any unsolicited advice, offers to buy shares at a
discount, or offers of free reports about the Company. The Financial
Conduct Authority (FCA) provides helpful information about such
scams on its website, including practical tips on how to protect your
savings and how to report a suspected investment scam. Man Group
encourages its shareholders to read the information on the site which
can be accessed at www.fca.org.uk/scamsmart. You can also call the
FCA Consumer Helpline on 0800 111 6768.
How your details are protected from cybercrime
Man Group takes the protection of its shareholders’ personal
data from the ever-increasing threat of cybercrime very seriously.
Shareholder details are maintained by EQ, our Registrars, who
safeguard this information to the highest standards. EQ’s security
measures include multiple levels of firewall, no wireless access to
the corporate network, and regular external vulnerability scans and
system penetration tests.
Dividends paid in the 2023/24 tax year
Interim dividend for the year ended 31 Dec 2023
Final dividend for the year ended 31 Dec 2022
Shareholder communications
Annual Report and Half Year Results
Man Group publishes an Annual Report and Half Year Results every
year. The Annual Report is published on the website and is sent
to shareholders through the post if they have requested to receive
a copy. The Half Year Results are published on the website and
printed copies are available on request from the Company Secretary.
E-communications
You can help Man Group to reduce its carbon footprint as well as its
printing and postage costs by signing up to receive communications
electronically rather than receiving printed documents such as
Annual Reports and Notices of AGMs in the post. To sign up for
e-communications, simply register on the EQ Shareview website.
You will need your Shareholder Reference, which can be found on
your share certificate or dividend confirmation or proxy card, in order
to register. Once registered, you will need to change your mailing
preference to e-communications and provide your email address.
You will then receive an email each time a shareholder communication
or document becomes available on the Man Group website.
Managing your shareholding
Online, by post, or by phone
Many aspects of your shareholding can be managed by registering on
the EQ Shareview website. For enquiries about your shareholding you
can also contact EQ in writing at EQ, Aspect House, Spencer Road,
Lancing, West Sussex BN99 6DA, or by telephone on 0371 384 21121
quoting Ref No 874. Please quote your Shareholder Reference when
contacting EQ.
Share dealing service
EQ provides a share dealing facility through which you can buy or sell
Man Group plc shares in the UK. The service is provided by Equiniti
Financial Services Limited and can be accessed via the dealing
section of the EQ Shareview website (www.shareview.co.uk/dealing).
To use EQ’s telephone dealing service, please call 03456 037 037
between 8.00am and 4.30pm Monday to Friday. You can also buy
and sell shares through any authorised stockbroker or bank that offers
a share dealing service in the UK, or in your country of residence if
outside the UK.
Man Group plc | Annual Report 2023
Strategic report | Governance | Financial statements | Shareholder information 182
Glossary
Absolute investment performance
Percentage rise/fall in the value of the fund over the stated period
Absolute return
Alternative strategies where clients expect the strategy may have net long,
short or neutral exposure to asset classes, and that may make use of leverage
to achieve those exposures. This includes trend following and discretionary
long/short strategies
Actively managed
The management of assets based on active decision-making as opposed to
aiming to replicate an index
AGM
Annual General Meeting
Alpha
Excess return over beta relative to a market benchmark, or a measure of the
‘value add’ by an investment manager
Alternative
An alternative investment is an asset that is not one of the conventional
investment types, such as stocks, bonds and cash
Alternative performance measure (APM)
APMs are financial measures of current, historical or future financial
performance, financial position or cash flows that are not defined or specified
in the applicable financial reporting framework. Man Group’s primary APMs are
defined as follows:
Core profit
Core profit excludes acquisition and disposal-related items, significant
non-recurring items and volatile or uncontrollable items, as well as profits
or losses generated outside of our investment management business.
Tax on these ‘non-core’ items and movements in deferred tax relating
to the utilisation or recognition of tax assets in the US are also excluded
Core tax rate
The core tax rate is the effective tax rate on core profit before tax and is equal
to the tax on core profit divided by core profit before tax
Net financial assets
Net financial assets is considered a proxy for Group capital and comprises our
cash and seed book less borrowings, contingent consideration payable,
liabilities for put options on non-controlling interests and payables under repo
arrangements
Full details of our APMs can be found on pages 175 to 179
Assets under management (AUM)
AUM are the assets that Man Group manages for investors in investment
vehicles (including fund entities and separately managed accounts) and is
a key indicator of our performance as an investment management group
and our ability to remain competitive and build a sustainable business.
Average AUM multiplied by our net management fee margin equates to our
management fee earning capacity. AUM is shown by strategy groupings that
have similar characteristics. AUM includes advisory-only assets where Man
Group provides model portfolios but does not have decision making or trading
authority over the assets and dedicated managed account platform services
for which Man Group provides platform and risk management services but
does not provide investment management services
Movements in AUM are split between the following categories:
Net inflows/outflows
Net inflows/outflows are a measure of Man Group’s ability to attract and retain
investor capital. Net flows are calculated as sales less redemptions
Investment performance
Investment performance is a measure of the performance of the investment
vehicles Man Group manages for its investors
FX and other movements
Some of Man Group’s AUM is denominated in currencies other than USD. FX
movements represent the impact of translating non-USD denominated AUM
into USD. Other movements principally relate to maturities and leverage
movements
ARCom
Audit and Risk Committee
Basis point (bps)
One one-hundredth of a percentage point (0.01%)
Benchmark
A standard against which the performance of a security, mutual fund
or investment manager can be measured; generally broad market and
market-segment stock and bond indexes are used for this purpose
Beta
Market returns
CAGR
Compound annual growth rate
Carbon dioxide equivalent (CO2e)
A standard unit for measuring carbon footprints. Enabling the impact of
different greenhouse gas emissions to be expressed using an equivalent
amount of carbon dioxide (CO2) as reference. We calculate total emissions
using tonnes per CO2e or tCO2e
Cash costs
Costs excluding depreciation and amortisation
Collateralised loan obligation (CLO)
CLOs are a security backed by a pool of debt, often corporate loans
Compensation ratio
The compensation ratio is calculated as total compensation costs divided by
net revenue
CS
Corporate Sustainability
DE&I
Diversity, Equity and Inclusion
Defined benefit (DB) pension scheme
A pension benefit where the employer has an obligation to provide participating
employees with pension payments that represent a specified percentage of
their salary for each year of service
Defined contribution (DC) pension scheme
A pension benefit where the employer’s contribution to an employee’s
pension is measured as, and limited to, a specified amount, usually a
percentage of salary
Discretionary
Discretionary investment management is a form of investment management
in which buy and sell decisions are made by a portfolio manager. The term
‘discretionary’ refers to the fact that investment decisions are made at the
portfolio manager’s discretion
Drive
Drive is our global internal diversity and inclusion network which is designed
to inform, support and inspire our people. The network’s mission is to advance
Man Group’s efforts in promoting and valuing diversity and inclusion
throughout the firm
Employee benefit trust
An employee benefit trust is a type of discretionary trust established to hold
cash or other assets for the benefit of employees, such as satisfying share
awards, with a view to facilitating the attraction, retention and motivation of
employees
Employee Trust
The Employee Trust is the employee benefit trust operated by Man Group
ESG
Environmental, Social and Governance
ESG-integrated AUM
Portion of total AUM that integrates explicit ESG criteria into the investment
process
Executive Committee (ExCo)
The executives responsible for delivering the firm’s strategy
External audit
An external auditor performs an audit, in accordance with specific laws or
rules, of the financial statements of an organisation and is independent of the
entity being audited
FCA
Financial Conduct Authority
FRC
Financial Reporting Council
GDPR
The General Data Protection Regulation
Man Group plc | Annual Report 2023
Shareholder information 183
Global Sustainable Investment Alliance (GSIA)
The Global Sustainable Investment Alliance
High-water mark
The value above which performance-fee-eligible AUM accrues
performance fees
HMRC
His Majesty’s Revenue and Customs
ICAAP
Internal Capital Adequacy and Assessment Process
ICARA
Internal Capital and Risk Assessment
IFRS
International Financial Reporting Standards
Internal audit
Provide independent assurance that an organisation’s risk management,
governance and internal control processes are operating effectively
Investment returns
The increase in AUM attributable to investment performance, market
movements and foreign exchange
KPI
Key Performance Indicator
Long-only
Long-only refers to a policy of only holding ‘long’ positions in assets
and securities
Machine learning
A process in which a range of applied algorithms recognise repeatable
patterns and relationships within observed data
Relative investment performance
Percentage rise/fall in the value of the fund over the stated period relative to
peers or benchmarks
Relative net flows
Percentage above/below asset-weighted industry net flows. Industry sources
include HFR, Morningstar and Man Group analysis
Revolving credit facility (RCF)
A line of credit, to an agreed limit, that businesses can access when needed
Run rate net management fee revenue and margin
Run rate net management fee margin is calculated as core net management
fee revenue for the last quarter divided by the average AUM for the last quarter
on a fund-by-fund basis. Run rate net management fee revenue is calculated
as the run rate net management fee margin applied to the closing AUM as at
the period end. These measures give the most up-to-date indication of our
management fee revenue at a given date
Safecall
An independent employee helpline www.safecall.co.uk
Sale and repurchase agreement
A sale and repurchase agreement (repo) is a short-term borrowing
arrangement under which Man Group sells certain of its fund product
investments to a third-party, with a commitment to repurchase them on a
prearranged future date for consideration of the sale proceeds plus interest
Scope 1, 2 and 3 emissions
The greenhouse gas (GHG) Protocol Corporate Standard classifies
a company’s greenhouse gas emissions into three ‘scopes’. Scope 1
emissions are direct emissions from owned or controlled sources. Scope 2
emissions are indirect emissions from the generation of purchased energy
including electricity, steam, heating and cooling. Scope 3 emissions include
all other indirect emissions that occur within a company’s value chain
Man Group
Man Group plc, through its investment management subsidiaries and
partnerships (collectively, ‘Man Group’), is a global investment management
business and provides a range of fund products and investment management
services for investors globally
Seed capital
Seed capital is an investment in a fund allowing it to develop a performance
track record or allowing it to be marketed to potential clients. Seed capital also
includes CLO risk retention positions and fund products to which Man Group
obtains exposure via sale and repurchase arrangements or TRSs
Mid-frequency quant equity
A systematic equity long/short strategy trading a diversified set of models
across timeframes of hours to weeks
MiFID II
The second iteration of the Markets in Financial Instruments Directive
Multi-manager solutions
Multi-manager solutions includes traditional fund of funds and managed
accounts investing in vehicles managed by asset managers other than
Man Group
Net asset value (NAV)
Net Asset Value or NAV is the sum total of the market value of all the investment
instruments held in the portfolio including cash, less any liabilities held in the
portfolio. NAV per share is found by dividing the total number of units
outstanding from the NAV
Net management fee margin
Margins are an indication of the management fee revenue margins negotiated
with Man Groups clients net of any distribution costs paid to intermediaries.
Net management fee margin is calculated as core net management fee
revenue divided by AUM
OMI
Oxford-Man Institute
Passive products
Products which are intended to replicate an index
QFII
Qualified Foreign Institutional Investor
Quantitative or quant
Quantitative strategies use computer models to make trading decisions.
A quant is a person who specialises in the application of mathematical
and statistical methods to financial and risk management problems
Regulatory capital
Regulatory capital is the amount of risk capital set by legislation or local
regulators, which companies must hold against any difficulties such as market
or credit risks
RI
Responsible Investment
Man Group plc | Annual Report 2023
SFDR
Sustainable Finance Disclosure Regulation
SMCR
Senior Managers Certification Regime. New FCA regulation which aims to
strengthen market integrity by making senior individuals more accountable
for their conduct and competence
Systematic
Systematic investment managers attempt to remove the behavioural component
of investing by using computer algorithms to make investment decisions
TCFD
Task Force on Climate-related Financial Disclosures
Total return
Alternative strategies where clients expect the strategy to have some
positive exposure to particular risk factors over the course of a market cycle
although the level of exposure may vary over time. This includes emerging
markets fixed income, US direct lending, real estate, risk premia, risk parity
and CLO strategies
Total return swap (TRS)
A total return swap is a swap agreement in which Man Group receives the
return on an underlying fund investment in exchange for an interest payment
on the notional investment
Trade execution
The completion of a buy or sell order on a security in the market
TSR
Total shareholder return
UN PRI
The United Nations-supported Principles for Responsible Investment
initiative is an international network of investors working together to
implement the six Principles for Responsible Investment. Its goal is to
understand the implications of sustainability for investors and support
signatories to incorporate these issues or implications into their investment
decision-making and ownership practices
Weighted average carbon intensity (WACI)
The measurement of a portfolio’s exposure to carbon-intensive companies,
expressed in tons of CO²e per million dollars of revenue
Strategic report | Governance | Financial statements | Shareholder information 184
Company contact details
Registered office
Man Group plc
22 Grenville Street
St Helier
Jersey JE4 8PX
Telephone: + 44 (0) 20 7144 1000
Website: www.man.com
Registered in Jersey with registered no: 127570
London office
Riverbank House
2 Swan Lane
London EC4R 3AD
United Kingdom
Telephone: +44 (0) 20 7144 1000
Investor relations
investor.relations@man.com
Head of Investor Relations – Karan Shirgaokar
Company secretariat
shareholder@man.com
Company Secretary – Elizabeth Woods
Communications
media@man.com
Head of Communications – Georgiana Brunner
Company advisers
Independent auditor
Deloitte LLP
Corporate brokers
Barclays
J.P. Morgan Cazenove
Corporate communications
FTI Consulting
Registrars
EQ
This Annual Report has been prepared for, and only for, the members of the Company, as a body, and no other persons. The Company, its
directors, employees, agents or advisers do not accept or assume responsibility to any other person to whom this document is shown or
into whose hands it may come and any such responsibility or liability is expressly disclaimed. By their nature, the statements concerning the
risks and uncertainties facing the Group in this Annual Report involve uncertainty since future events and circumstances can cause results
and developments to differ materially from those anticipated. The forward-looking statements reflect knowledge and information available
at the date of preparation of this Annual Report and the Company undertakes no obligation to update these forward-looking statements.
Nothing in this Annual Report should be construed as a profit forecast.
Man Group plc | Annual Report 2023
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Man Group plc
Riverbank House
2 Swan Lane
London EC4R 3AD
man.com
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