Who is Salim Ramji, the new Vanguard CEO?

By Bill Peters

BlackRock veteran to take over in July, bringing years of wealth-management and advisory experience

Vanguard Group on Tuesday appointed BlackRock Inc. veteran Salim Ramji as its new chief executive, a move that will give the asset-management giant a leader with years of experience in wealth advisory and management who is known for his efforts to expand investing access.

The Wall Street Journal reported the news earlier Tuesday. The appointment comes as Vanguard - known for its mutual funds - tries to move more deeply into the profitable area of financial advice, the Journal noted.

Ramji will take the helm at Vanguard, as well as a spot on its board, on July 8. He left BlackRock (BLK) earlier this year after spending more than a decade at the firm. Vanguard's current chief executive, Tim Buckley, will step down from that position and from the role of chairman when Ramji comes aboard.

Vanguard said in February that Buckley would retire as its chief executive by the end of the year.

Most recently, Ramji headed up BlackRock's iShares and index investments, where he oversaw considerable growth. Vanguard, in announcing Ramji's appointment, emphasized his efforts to roll out low-cost investment products.

"His contributions led to expanded investment access for tens of millions of investors, a more central role for [exchange-traded funds] in retirement and wealth portfolios and a more efficient bond market with ETFs as an enabling technology," Vanguard said. "At BlackRock, he led the implementation of a voting choice platform, which democratizes client access to the proxy voting process."

From 2015 to 2019, according to Ramji's LinkedIn profile, he was also the head of BlackRock's U.S. wealth-advisory segment, where he oversaw the company's relationships with wealth-management firms. He began his time at BlackRock in 2014 as its global head of corporate strategy.

BlackRock, in a statement, congratulated Ramji. A spokesperson said the firm was "proud to have a track record of our firm's alumni going on to lead multiple investment management companies and other financial Institutions."

Prior to his time at BlackRock, Ramji worked at the consulting firm McKinsey for 16 years, leading duties related to asset and wealth management. He was a lawyer at Clifford Chance from 1994 to 1998, according to the profile.

"We have significant opportunities for growth ahead, including how technology and the client experience can drive solutions and extend the benefits of wealth management to more investors," Mark Loughridge, Vanguard's lead independent director, said in the company's statement on Tuesday.

Ramji would be the first Vanguard chief executive who didn't work directly with John Bogle, who founded Vanguard in 1974, the Journal said. Bogle died in 2019.

Morningstar analyst Daniel Sotiroff, in a post on Tuesday, said that Vanguard managed more than $8.4 trillion from roughly 50 million clients worldwide as of the end of March.

But he said the firm, despite its size, still faced challenges. Those issues included customer complaints and backlash after Vanguard raised fees on some services, difficulties expanding beyond the U.S. and a flight from actively managed mutual funds to cheaper exchange-traded funds.

"I'm surprised that Vanguard went with an outside hire," he said via email. "This is a departure from past hires, as previous CEOs came up through the ranks and were embedded in Vanguard's culture from early on in their careers."

He added: "While Vanguard is doing great in some areas, like inflows and disciplined product development, it is struggling in others, like client service and growth in international markets. I'd really like to see Vanguard stay on track with the former and make some adjustments to improve the latter, but we'll have to wait and see."

-Bill Peters

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05-15-24 1332ET

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