"Document everything about the hiring process — include multiple interviews with different stakeholders, structured notes, clear criteria, the why behind the decision."
Family ties remain strong in asset management, but firms are increasingly formalizing policies and disclosures to manage the risks that come with them.
In an industry long shaped by dynastic wealth and intergenerational business, relatives of senior executives continue to appear throughout the organizational charts of leading fund firms.
But many companies have put policies in place to ensure fairness and prevent favoritism toward family members.
When Bill Stone‘s children started joining SS&C, the company he founded nearly four decades ago, he warned them they’d have to work harder than most, the CEO said.
“I told my kids, you’ve got the wrong last name if you’re going to come to SS&C and not work hard,” Stone said.
Today, all three of Stone’s children, who are all in their 30s, work at the firm, holding roles in investor relations, business development and fund administration.
In 2024, Robert Stone, the son of SS&C’s CEO, was paid nearly $3.6 million in salary, commissions, fair value of stock awards and other compensation related to his employment as senior vice president and general manager of SS&C Intelligent Automation and Analytics.
Bill Stone’s daughters, Justine and Elizabeth, were each paid approximately $450,000 during that same period.
“We watch for related-party transactions, and in general, the kids don’t work for the parents,” Stone said. “But it’s a talent race out there. If someone’s related but they’re really talented, why wouldn’t you hire them?”
The SS&C chief executive acknowledged that working with family can blur emotional lines, but it’s important to keep home life out of work.
“You’ve got to let go of something that happened on vacation three years ago,” he said. “You can’t let that carry into the boardroom.”
To account for both issues, SS&C keeps distance between relatives in its reporting structure; Stone’s children don’t report to him or to each other, and they’ve earned their roles, he said.
An analysis of 10-K filings reviewed by Ignites found that companies including Federated Hermes, Franklin Templeton, Gamco and SS&C all reported employing the relatives of high-ranking executives.
The son of Thomas Donahue, the chief financial officer of Federated Hermes, works as a director of corporate budgeting and FP&A sales and was paid $210,000 in 2024, the firm’s 10-K shows. He was also awarded a periodic restricted stock award of $156,640 worth of Federated common stock.
Thomas and Chris Donahue, the CEO of Federated Hermes, are brothers, a regulatory filing shows.
At Gamco, several family members of Chief Executive Officer Mario Gabelli are employed at lower levels within the company.
One of his sons, who joined the firm in 1998, manages a $34.6 million proprietary investment fund and earned a base salary of $185,000 in 2024, according to the firm’s 10-K. Another one of Gabelli’s sons has been employed by a Gamco subsidiary since 2006 and earned a base salary of $225,000 in 2024.
The filing did not identify which son is in each role.
Gamco stated that these employees are financially independent, not executive officers, and that their pay is consistent with others in similar roles in the filing.
At Franklin Templeton, the Johnson family legacy is baked into the firm’s identity: Current CEO Jenny Johnson is the granddaughter of founder Rupert Johnson and took the reins from her brother Gregory Johnson in 2019.
Fidelity, which is not a public company and is not required to file relevant disclosures, has deep roots as a family company. Abigail Johnson, who took over as Fidelity’s chief executive in 2014, is the granddaughter of the firm’s founder, Edward Johnson II, who established the company in 1946.
She took over for her father, Ned Johnson III, who assumed the role as the successor to the company founder.
As of October 2024, Forbes ranked Abigail Johnson as the 30th richest American, with an estimated net worth of $31.3 billion. Two of her siblings also appeared on the list, each with personal wealth exceeding $10 billion.
Spokespeople from Federated Hermes, Fidelity and Franklin Templeton declined to comment.
The best way to ensure a fair hiring process for those related to executives within the firm is by prioritizing transparency and keeping family members out of each other’s chain of command, said Deb Muller, chief executive officer at HRAcuity.
“Document everything about the hiring process — include multiple interviews with different stakeholders, structured notes, clear criteria, the why behind the decision,” said Muller. “If questions come later, and they will, you’ve got a clean, defensible record that merit drove the choice.”
Transparency around family-owned asset management firms addresses the sensitivities that arise when family members work together or share ownership, said Matt Giordano, audit sector leader and audit service line leader for asset management at KPMG U.S.
Many firms have grown to notice the difference between inherited opportunities and earned positions, he said. Board members have been an important tool to keep family-owned firms in check with success planning and business decisions, Giordano said.
“The firms managing these dynamics well find a way to balance family relationships for mentorship and culture with institutional processes for decision-making and performance evaluation,” he added.
If a firm employee’s nephew applies for a job, that person should go through the exact same interviews and evaluations as other people applying for the same role, Muller said.
“That way, when someone questions the hire, you’ve got documentation showing he earned it,” she said.
