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What changed in AFFILIATED MANAGERS GROUP, INC.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of AFFILIATED MANAGERS GROUP, INC.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+324 added−285 removedSource: 10-K (2025-02-14) vs 10-K (2024-02-16)

Top changes in AFFILIATED MANAGERS GROUP, INC.'s 2024 10-K

324 paragraphs added · 285 removed · 225 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeWe also provide succession planning solutions and advice to many of our Affiliates, which can include a degree of liquidity and financial diversification along with incentive alignment for next-generation partners. 1 Table of Contents Our innovative partnership approach enhances our Affiliates’ ability to achieve their long-term strategic objectives while maintaining their independence and autonomy, and therefore, their unique entrepreneurial and investment-centric cultures.
Biggest changeIn addition, for some of our Affiliates, we leverage our long-term partnership approach to facilitate succession planning across generations of Affiliate management principals and provide succession planning solutions and advice, which can include a degree of liquidity and financial diversification along with incentive alignment for next-generation partners.
Our Affiliates’ attractive return streams are utilized in client portfolios to address a range of specialized needs for institutional and wealth clients globally; certain Affiliates also provide investment management and customized investment counseling and fiduciary services to high net worth individuals and families and institutional clients.
Our Affiliates’ attractive return streams are utilized in client portfolios to address a range of needs for institutional and wealth clients globally; certain Affiliates also provide investment management and customized investment counseling and fiduciary services to high net worth individuals and families and institutional clients.
Further, we support employees’ educational pursuits relating to degree programs and certifications through company-supported time off for professional development and flexible work arrangements tailored to individual employees’ educational goals.
Further, we support employees’ educational pursuits relating to degree programs and certifications through company-supported time off and funding for professional development and flexible work arrangements tailored to individual employees’ educational goals.
Commodity Futures Trading Commission (“CFTC”) with respect to the management of funds and other products that utilize futures, swaps or other CFTC-regulated instruments. In addition, certain of our Affiliates and our U.S. wealth broker-dealer subsidiary are registered broker-dealers and members of the Financial Industry Regulatory Authority (“FINRA”), for the purpose of distributing funds or other products.
Commodity Futures Trading Commission (“CFTC”) with respect to the management of funds and other products that utilize futures, swaps, o r other CFTC-regulated instruments. In addition, certain of our Affiliates and our U.S. wealth broker-dealer subsidiary are registered broker-dealers and members of the Financial Industry Regulatory Authority (“FINRA”), for the purpose of distributing funds or other products.
We make these reports available through our website as soon as reasonably practicable after our electronic filing of such materials with, or the furnishing of them to, the SEC. The information contained or incorporated on our website is not a part of this Annual Report on Form 10-K. 6 Table of Contents
We make these reports available through our website as soon as reasonably practicable after our electronic filing of such materials with, or the furnishing of them to, the SEC. The information contained or incorporated on our website is not a part of this Annual Report on Form 10-K. 7 Table of Contents
When we do not own a controlling equity interest in an Affiliate, but have significant influence, we account for our interest in the Affiliate under the equity method. Under the equity method of accounting, we do not consolidate the Affiliate’s results into our Consolidated Financial Statements.
When we own a controlling equity interest in an Affiliate, we consolidate the Affiliate’s financial results into our Consolidated Financial Statements. When we do not own a controlling equity interest in an Affiliate, but have significant influence, we account for our interest in the Affiliate under the equity method.
Given this, the following is a discussion of AMG’s workforce, or approximately 250 of the total employees, and the policies and cultural initiatives which pertain to our human capital. Our employees and our reputation are our most important assets, and attracting, retaining, and motivating top talent to execute on our strategic business objectives is a fundamental imperative.
Given this, the following is a discussion of AMG’s workforce, or approximately 250 of the total employees, and the policies and cultural initiatives which pertain to our human capital. 6 Table of Contents Our employees and our reputation are our most important assets, and attracting, retaining, and motivating top talent to execute on our strategic business objectives is a fundamental imperative.
Due to the extensive laws and regulations to which we and our Affiliates are subject, we and our Affiliates must devote substantial time, expense and effort to remain current on, and to address, legal and regulatory compliance matters.
Due to the extensive laws and regulations to which we and our Affiliates are subject, we and our Affiliates must devote substantial time, expense an d effort to remain current on, and to address, legal and regulatory compliance matters.
We seek to recruit the best people for the job without regard to gender, ethnicity or other protected traits, and it is our policy to comply fully with all domestic, foreign and local laws relating to discrimination in the workplace.
We seek to recruit the best people for each role without regard to gender, ethnicity, or other protected traits, and it is our policy to comply fully with all domestic, foreign, and local laws relating to discrimination in the workplace.
Human Capital Management As of December 31, 2023, we and our Affiliates had approximately 4,000 employees, the substantial majority of which were employed by our Affiliates and not by AMG. Each Affiliate’s management team retains autonomy in managing and operating their business on a day-to-day basis, including with respect to their human capital.
Human Capital Management As of December 31, 2024 , we and our Affiliates had approximately 4,100 employees, the substantial majority of which were employed by our Affiliates and not by AMG. Each Affiliate’s management team retains autonomy in managing and operating their business on a day-to-day basis, including with respect to their human capital.
Our annual anonymous employee engagement survey reported an employee satisfaction rating of 90% in 2023, which we attribute to our focus and commitment to our employees, our entrepreneurial culture and partnership orientation, and our meaningful involvement with communities surrounding our offices.
Our annual anonymous employee engagement survey reported an employee satisfaction rating of approximately 90% in 2024 , which we attribute to our focus and commitment to our employees, our entrepreneurial culture and partnership orientation, and our meaningful involvement with communities surrounding our offices.
We believe that the most important factors on which we compete for future investments are purchase price and liquidity; our partnership investment model, including the equity incentive structures and access to strategic capabilities we offer; and the breadth and depth of our relationships, and our reputation, with investment firm prospects.
We believe that the most important factors on which we compete for future investments are purchase price; our partnership model, including the equity incentive structures and access to capital formation and strategic advisory capabilities; and the breadth and depth of our relationships, and our reputation, with investment firm prospects.
Item 1. Business AMG is a strategic partner to leading independent investment firms globally. Our strategy is to generate long-term value by investing in a diverse array of high-quality independent partner-owned firms, referred to as “Affiliates,” through a proven partnership approach, and allocating resources across our unique opportunity set to the areas of highest growth and return.
Item 1. Business Overview AMG is a strategic partner to leading independent investment firms globally. Our strategy is to generate long-term value by investing in high-quality independent partner-owned firms, which we refer to as “Affiliates,” through a proven partnership approach, and allocating resources across our unique opportunity set to the areas of highest growth and return.
We are well-positioned to execute upon these investment opportunities through our: • established process of identifying and cultivating high-quality prospective Affiliates; • broad industry network and proprietary relationships developed with prospects over many years; • substantial experience and expertise in structuring and negotiating transactions; • global reputation as an excellent partner to our Affiliates, having provided innovative solutions for the strategic needs of independent investment firms across three decades; and • successful engagement with our Affiliates to enhance their long-term prospects, including through product development, distribution, and other business development initiatives.
We are well-positioned to execute upon these investment opportunities through our: • established process of identifying, and cultivating relationships with, high-quality prospective Affiliates; • broad industry network and proprietary relationships developed with prospects over many years; • substantial experience and expertise in structuring and negotiating transactions; • global reputation as an excellent partner to our Affiliates, having provided innovative solutions for the strategic needs of independent investment firms across three decades; and • successful engagement with our Affiliates to enhance their long-term prospects, including through product development, distribution, and other business development initiatives. 3 Table of Contents Our Affiliates Our Affiliates provide a diverse range of differentiated return streams through their specialized investment processes.
Many of our Affiliates are also subject to directives and regulations in the European Union and other jurisdictions relating to funds, such as the Undertakings for the Collective Investment of Transferable Securities (“UCITS”) Directive and the Alternative Investment Fund Managers Directive (“AIFMD”), with respect to depositary functions, remuneration policies and sanctions, among other matters.
Many of our Affiliates are also subject to directives and regulations in the European Union and other jurisdictions relating to funds, such as the UCITS Directive and the Alternative Investment Fund Managers Directive, with respect to depositary functions, remuneration policies, and sanctions, among other matters.
Many of our Affiliates also sponsor or advise registered and unregistered 4 Table of Contents funds in the U.S. and in other jurisdictions, and are subject to regulatory requirements in the jurisdictions where those funds are sponsored or offered, including, with respect to mutual funds in the U.S., the Investment Company Act of 1940, as amended (the “Investment Company Act”).
Many of our Affiliates also sponsor or advise registered and unregistered funds in the U.S. and in other jurisdictions, and are subject to regulatory requirements in the jurisdictions where those funds are sponsored or offered, including, with respect to mutual funds in the U.S., the Investment Company Act.
Affiliate management equity ownership (along with our long-term ownership) aligns our interests and preserves Affiliate management equity incentives, including the opportunity for Affiliate management to participate directly in the long-term future growth and profitability of their firms.
Affiliate management equity ownership (along with our long-term ownership) aligns our interests and preserves Affiliate management equity incentives, including the opportunity for Affiliate management to participate directly in the long-term future growth and profitability of their firms. Our goal with Affiliates is to be an excellent partner.
Where we share in the Affiliate’s revenue without regard to expenses, the Affiliate allocates a specified percentage of its revenue to us and Affiliate management, while using the remainder for operating expenses and additional distributions to Affiliate management.
In the case of structures where we contractually share in the Affiliate’s revenue without regard to expenses, comprising Affiliates that contribute a majority of our Consolidated revenue, the Affiliate allocates a specified percentage of its revenue to us and Affiliate management, while using the remainder for operating expenses and additional distributions to Affiliate management.
We routinely post financial, investment performance, and other important information regarding the Company in the Investor Relations section of our website and we encourage investors to consult that section regularly.
Our website provides information about us, and, from time to time, we may use it to distribute material company information. We routinely post financial, investment performance, and other important information regarding the Company in the Investor Relations section of our website and we encourage investors to consult that section regularly.
Our innovative model enables each Affiliate’s management team to retain autonomy and significant equity ownership in their firm, while they leverage our strategic capabilities and insight, including growth capital, product strategy and development, capital formation, and incentive alignment and succession planning.
Our innovative model enables each Affiliate’s management team to retain autonomy and significant equity ownership in their firm, while they leverage our strategic capabilities and insight, including access to growth capital, product strategy and distribution through our capital formation capabilities, succession planning, and strategic advisory, to expand their reach, diversify their businesses, and enhance their long-term success.
We will, therefore, continue to have a significant opportunity to invest in additional high-quality firms across the global investment management industry. In addition, we have the opportunity to make additional equity investments in our existing Affiliates, or invest in their growth by providing seed or other growth capital.
In addition, we continue to have the opportunity to make additional equity investments in our existing Affiliates, or invest in their growth by providing seed or other growth capital.
Virtually all aspects of the asset management business, including the provision of advice, investment strategies and trading, fund sponsorship, and product-related sales and distribution activities, are subject to regulation. These regulations are primarily intended to protect the clients of investment advisers and generally grant regulatory authorities broad administrative and enforcement powers.
Virtually all aspects of the asset management business, including the provision of advice, investment strategies and trading, fund sponsorship, and product-related sales and distribution activities, are subject to regulation.
We believe that clients recognize these fundamental characteristics of partner-owned firms, as well as the alignment created by direct equity ownership by firm principals, as competitive advantages in achieving client investment goals and objectives. Our investment approach preserves these essential elements of our Affiliates’ success.
We believe that clients recognize these fundamental characteristics of partner-owned firms, as well as the alignment created by direct equity ownership by firm principals, as competitive advantages in achieving client investment goals and objectives. We hold meaningful equity interests in each of our Affiliates, and typically each Affiliate’s management team retains a significant equity interest in their own firm.
Investment Management Operations Our Affiliates provide a diverse range of differentiated return streams through their specialized investment processes. Given their long-term performance records, our Affiliates are recognized as being among the industry’s leaders in their respective investment disciplines.
Given their long-term performance records, our Affiliates are recognized as being among the industry’s leaders in their respective investment disciplines.
The operating agreement also reflects the specific terms of our economic participation in the Affiliate, which, in each case, uses a “structured partnership interest” to ensure alignment of our economic interests with those of Affiliate management.
Each of our Affiliates operates through distinct legal entities, which affords us the flexibility to design a separate operating agreement for each Affiliate that reflects the customized arrangement, including with respect to the specific terms of our economic participation in the Affiliate, which, in each case, uses a “structured partnership interest” to ensure alignment of our economic interests with those of Affiliate management.
With meaningful earnings contributions from each of private markets, liquid alternatives, and differentiated long-only strategies (which includes global equities, U.S. equities, and multi-asset and fixed income strategies), AMG’s business profile is highly diversified.
With meaningful earnings contributions from each of private markets, liquid alternatives, and differentiated long-only (including equities and multi-asset and fixed income) strategies, AMG’s business and earnings profile is highly diversified. Our Partnership Structure with Affiliates AMG offers bespoke partnership solutions to address each Affiliate’s unique needs.
The majority of our Affiliates are registered with the SEC as investment advisers under the Investment Advisers Act of 1940, as amended (the “Advisers Act”). The Advisers Act imposes numerous obligations on registered investment advisers, including fiduciary duties, compliance and disclosure obligations, and operational and recordkeeping requirements.
The Advisers Act imposes numerous obligations on registered investment advisers, including fiduciary duties, compliance and disclosure obligations, and operational and recordkeeping requirements.
Under these structured partnership interests our contractual share of revenue generally has priority over distributions to Affiliate management. 3 Table of Contents Where we share in the Affiliate’s revenue less agreed-upon expenses, we benefit from any increase in revenue or any decrease in the agreed-upon expenses, but also have exposure to any decrease in revenue or any increase in such agreed-upon expenses.
We and Affiliate management, therefore, participate in any increase or decrease in revenue, and only Affiliate 4 Table of Contents management participates in any increase or decrease in expenses. Under these structured partnership interests our contractual share of revenue generally has priority over distributions to Affiliate management.
The degree of our exposure to agreed-upon expenses from these structured partnership interests varies by Affiliate, and includes several Affiliates in which we fully share in the expenses of the business. When we own a controlling equity interest in an Affiliate, we consolidate the Affiliate’s financial results into our Consolidated Financial Statements.
The degree of our exposure to agreed-upon expenses from these structured partnership interests varies by Affiliate, and includes several Affiliates in which we fully share in the expenses of the business. Further, the expenses in which we agree to share may change during the course of our investment.
We support that imperative through our strong values-based culture, commitment to career development and training, employee engagement initiatives, attractive compensation and benefits programs, attention to succession planning, and fostering of organizational diversity at all levels of our organization. 5 Table of Contents Our leadership training and sponsored skills development programs cover a wide range of subject area expertise as well as career development generally, and are anchored on a comprehensive performance review process, which includes a company-wide 360-degree review program.
We support that imperative through our strong values-based culture, commitment to career development and training, employee engagement initiatives, attractive compensation and benefits programs, attention to succession planning, and fostering of organizational diversity at all levels of our organization.
Our distribution capabilities, which provide access to institutional and wealth clients, serve to extend the reach of our Affiliates’ own business development efforts, including strategy, marketing, distribution, and product development, and our Affiliates benefit from the expertise of our senior sales and marketing professionals servicing the U.S., Europe, the UK, the Middle East, Asia, and Australia.
Our distribution capabilities provide access to institutional and wealth clients to complement our Affiliates’ own resources and expand their reach, including by leveraging the expertise of our senior sales and marketing professionals and the depth and breadth of AMG’s strategic relationships in the U.S., Europe, the UK, the Middle East, and Asia.
We also have institutional distribution subsidiaries or branches of subsidiaries regulated by the Dubai Financial Services Authority and the Australian Securities and Investments Commission, and our activities in the European Union are regulated by various regulators in European jurisdictions.
We also have an institutional distribution branch of a subsidiary regulated by the Dubai Financial Services Authority , and any activities in the European Union are subject to compliance with applicable regulations in various European jurisdictions.
We have achieved gender diversity of 38% across management positions in our workforce, and nearly half (47%) of our employees are women. Further, three of eight (38%) independent members of our Board of Directors are women, and two of eight (25%) independent directors are ethnically diverse, in each case, above the average of S&P 500 companies.
Across management positions in our workforce, gender diversity is 39% , and nearly half ( 48% ) of our employees are women. Further, three of seven ( 43% ) independent members of our Board of Directors are women, and three of seven ( 43% ) independent directors are ethnically diverse.
As of December 31, 2023, our aggregate assets under management were approximately $673 billion across a diverse range of private markets, liquid alternative, and differentiated long-only investment strategies.
As of December 31, 2024 , our Affiliates managed approximately $708 billion across a broad range of investment styles and geographies, in alternative and differentiated long-only strategies, as described below. Alternative Strategies Private Markets: Our Affiliates managed approximately $135 billion in private market assets.
Through our matching program as well as through direct grants, AMG and The AMG Charitable Foundation have made donations to more than 800 organizations around the world to date. We believe that organizational diversity results in a highly creative and innovative workforce, and are committed to fostering and promoting an inclusive and diverse work environment.
Through our matching program as well as through direct grants, AMG and The AMG Charitable Foundation have made donations to more than 900 organizations around the world to date.
Independent firms seeking an institutional partner are attracted to our unique partnership approach and our global reputation as a successful strategic partner to independent investment firms around the world. We anticipate that the principal owners of independent investment firms will continue to seek access to an evolving range of growth and succession solutions.
We anticipate that the principal owners of independent investment firms will continue to seek access to an evolving range of growth and succession solutions. We will, therefore, continue to have a significant opportunity to invest in and partner with additional high-quality firms across the global investment management industry.
With their entrepreneurial, investment-centric cultures and alignment of interests with clients through direct equity ownership by firm principals, independent firms have fundamental competitive advantages in offering unique return streams to the marketplace. Through AMG’s distinctive approach, we enhance these advantages to magnify the long-term success of our Affiliates and actively support their independence.
With their entrepreneurial, investment-centric cultures, and deep alignment of interests with clients through direct equity ownership by firm principals, independent firms have an ownership mindset, a long-term orientation to building their firms, and the ability to act nimbly to capitalize on market movements, enabling them to offer unique return streams to the marketplace.
Our executive management team has responsibility for diversity initiatives, in coordination with our Sustainability Committee, and reviews these initiatives with our Board of Directors at least annually. Our Website Our website is www.amg.com . Our website provides information about us, and, from time to time, we may use it to distribute material company information.
In addition, one of our three Board committees is chaired by a woman. Our executive management team has responsibility for human capital initiatives, in coordination with our Sustainability Committee, and reviews these initiatives with our Board of Directors regularly. Our Website Our website is www.amg.com .
We are focused on investing in areas of secular growth and long-term client demand, including in private markets, liquid alternatives, Asia, wealth management, and sustainable investing; accordingly, we partner with leading independent investment firms managing differentiated strategies in the aforementioned growth areas.
Across these opportunities, we are focused on investing in areas of secular growth and long- 2 Table of Contents term client demand. As part of our strategy, we consistently evaluate our forward opportunity set; over the last several years, we have further invested in alternative strategies, including private markets and liquid alternatives.
Further, the structure at a particular Affiliate, or the expenses that we agree to share in, may change during the course of our investment.
The form of our structured partnership interests in our Affiliates differs from Affiliate to Affiliate, and may change during the course of our investment.
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We generate long-term value by investing in new and existing Affiliates, and strategic value-add capabilities through which we can leverage our scale and resources on behalf of our Affiliates, and then by returning excess capital to shareholders, primarily through share repurchases.
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We believe that high-quality, partner-own ed firms have fundamental competitive advantages in meeting client objectives.
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Through our partnership approach, we hold meaningful equity interests in each of our Affiliates, and typically each Affiliate’s management team retains a significant equity interest in their own firm.
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AMG’s distinctive partnership approach magnifies the existing advantages of our independent Affiliates and actively supports their ongoing independence and ownership culture.
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Our goal in partnering with Affiliates is to be an excellent and engaged partner, and to collaborate with Affiliates to magnify each firm’s long-term success. We take a long-term partnership approach with our Affiliates, which provides stability in facilitating succession planning across generations of Affiliate management principals.
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Given that our Affiliates operate across alternatives and differentiated long-only strategies, we believe AMG is highly diversified. Our Affiliates manage numerous differentiated strategies across a range of return-oriented asset classes and structures across alternatives (including private markets and liquid alternatives) and differentiated long-only (including equities and multi-asset and fixed income).
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We are uniquely able to provide strategic capabilities and expertise across various stages of our Affiliates’ growth. In certain cases, we invest in our Affiliates by providing growth capital or complementing their own marketing resources with our proven product development and distribution capabilities.
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We have built a highly diversified portfolio of Affiliates over time, and the underlying diversity by strategy, product, and client type enhances our earnings stability across all stages of a market cycle, and therefore our ability to consistently invest in the areas of highest growth and return to generate value for shareholders.
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As of December 31, 2023, our Affiliates managed approximately $673 billion across a broad range of investment styles and geographies, in alternative, equity, and multi-asset and fixed income strategies, as the following chart illustrates. 2 Table of Contents Assets Under Management Our Affiliates currently manage assets for investors in more than 50 countries, including all major developed markets.
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Our Strategy We generate long-term value by investing in high-quality independent partner-owned firms and allocating resources across AMG’s unique opportunity set to the areas of highest growth and return. Our business generates significant cash flow, which we deploy toward growth investments and return of capital to shareholders, primarily through share repurchases.
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Our Affiliates distribute their investment services and products to institutional and wealth clients through direct sales efforts and established relationships with consultants and intermediaries around the world through their own business development capabilities. In addition, AMG supports the long-term growth and client diversification of our Affiliates by operating a distribution platform in which each Affiliate may choose to participate.
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Our growth investments are focused on: (i) partnering with high-quality new Affiliates operating in secular demand areas; (ii) investing in and alongside our existing Affiliates to capitalize on their growth opportunities, including through seeding new products; and (iii) investing in our own strategic value-add capabilities, which are leveraged by our Affiliates to further scale and diversify their organizations.
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Our Partnership Structure and Relationship with Affiliates We believe that Affiliate management equity ownership in their firms (along with our long-term partnership) aligns our and our Affiliates’ interests, enhances Affiliate management equity incentives, and preserves the opportunity for Affiliate management to participate directly in the long-term future growth and profitability of their firm.
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Through these recent growth investments, we have deliberately evolved our business toward alternatives, with the intention of improving our long- term organic growth and earnings growth prospects as well as further enhancing the stability of our cash flow. AMG’s strategic expertise in collaborating with partner-owned firms has been honed over the course of three decades.
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Although the equity structure of each Affiliate investment is tailored to meet the needs of the management equity owners of the particular Affiliate, we typically maintain a meaningful equity interest in the Affiliate, with a significant equity interest retained by Affiliate management principals.
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Our unique approach provides independent firms with the advantages of a long-term strategic partnership, while actively supporting their autonomy and independence, thereby preserving their core strengths and essential elements of their success – their entrepreneurial cultures, investment focus, and disciplined long-term orientations.
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Each of our Affiliates operates through distinct legal entities, which affords us the flexibility to design a separate operating agreement for each Affiliate that reflects customized arrangements with respect to governance, economic participation, equity incentives, and the other terms of our relationship.
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Each Affiliate partnership is unique, and we work closely with our Affiliates to determine how AMG might amplify the long-term success of each firm by collaborating across a range of strategic areas, including access to growth capital, product strategy and distribution through our capital formation capabilities, succession planning, and strategic advisory.
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In each case, the operating agreement provides for a governance structure that gives Affiliate management the authority to manage and operate the business on a day-to-day basis.
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In many cases, where Affiliates access our growth capital or capital formation capabilities, we invest our capital and resources to develop, seed, and distribute new strategies and products to meet evolving client needs, as well as by deploying our distribution capabilities.
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The form of our structured partnership interests in our Affiliates differs from Affiliate to Affiliate and ranges from structures where we contractually share in the Affiliate’s revenue without regard to expenses, comprising Affiliates that contribute a majority of our Consolidated revenue, to others where we contractually share in the Affiliate’s revenue less agreed-upon expenses.
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As part of our capital formation capabilities, AMG’s vertically-integrated U.S. wealth platform enables Affiliates to access the attractive and growing wealth marketplace.
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We and Affiliate management, therefore, participate in any increase or decrease in revenue, and only Affiliate management participates in any increase or decrease in expenses.
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Affiliates can leverage AMG’s product development capabilities, sales organization, and operational platform to access this market, which is challenging for independent managers to effectively do on their own at scale; likewise, AMG’s platform provides wealth clients with access to differentiated product from best-in-class independent managers.
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In addition, two of our three Board committees are chaired by women. We continually seek to enhance the diversity of our employee base, as our employees around the world contribute their distinct perspectives to improve our business and the communities in which our businesses operate.
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We have a track record of successfully bringing Affiliate strategies to market, having launched one of the first evergreen funds in the private equity space, and are continuing to build on our success through the launch of a number of new alternative strategies in the wealth marketplace.
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Our proven ability to magnify the competitive advantages of partner-owned firms, while also preserving their independence, differentiates AMG's partnership model and is increasingly valued by prospective Affiliates. Independent firms seeking an institutional partner are attracted to our innovative partnership approach and our global reputation as a successful strategic partner to independent investment firms around the world.
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These Affiliates operate in a diverse number of areas with long-term structural tailwinds, including infrastructure, credit, private market solutions, and specialty areas including industrial decarbonization, life sciences, and multi-family real estate.
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With long-dated capital commitments, and the growing potential to generate and realize carried interest over time, we believe our private markets Affiliates enhance AMG’s long-term organic growth, earnings power, and cash flow stability. Liquid Alternatives: Our Affiliates managed approximately $141 billion in liquid alternative assets.
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These Affiliates have excellent long-term track records across both beta-sensitive and absolute return strategies, including global macro, relative value fixed income, and trend-following, which are designed to generate returns that have low or no correlation to broader markets.
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These strategies can generate sizable performance fee earnings that — given their diversity and demonstrated low correlation to risk assets — can contribute to the stability of AMG’s earnings over time. Many of our liquid alternative strategies are designed to protect against volatility and drawdowns, complementing our private markets and differentiated long- only strategies.
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Differentiated Long-Only Strategies Equities and Multi-asset and Fixed Income: Our Affiliates managed approximately $316 billion in equity assets across a number of differentiated products and approximately $116 billion in multi-asset and fixed income strategies.
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Our Affiliates operate across a range of traditional equity and fixed income strategies typically through mutual fund products governed by the Investment Company Act of 1940, as amended (the “Investment Company Act”), separately managed accounts, and Undertakings for Collective Investment in Transferable Securities (“UCITS”), in both the U.S. and international markets.
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Additionally, we have several wealth management Affiliates, which manage multi-asset class portfolios on behalf of their clients. These Affiliates have built enduring franchises with specialized investment expertise and long-term track records across all stages of a market cycle.
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Consistent with AMG’s partnership approach and commitment to independence, we offer a range of operating structures and have customized arrangements with each of our Affiliates that provide their management teams with the authority to manage and operate the business on a day-to- day basis.
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In the case of structures where we contractually share in the Affiliate’s revenue less agreed-upon expenses, we benefit from any increase in revenue or any decrease in the agreed-upon expenses, but also have exposure to any decrease in revenue or any increase in such agreed-upon expenses.
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Under the equity method of accounting, we do not consolidate the Affiliate’s results into our Consolidated Financial Statements.
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We believe we offer a unique and differentiated partnership opportunity to Affiliates based on the long-term duration of our partnership, the ability for our Affiliates to remain independent partner-owned investment firms, and our strategic capabilities.
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These regulations are primarily intended to protect the clients of investment advisers and generally grant regulatory authorities broad administrative and enforcement powers. 5 Table of Contents The majority of our Affiliates are registered with the SEC as investment advisers under the Investment Advisers Act of 1940, as amended (the “Advisers Act”).
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Our leadership training and sponsored skills development programs cover a wide range of subject area expertise as well as career development generally, and are anchored on a comprehensive performance review process, which includes a company- wide 360-degree review program.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur and our Affiliates’ reputations are critical to our business and could be impacted by events that may be difficult or impossible to control, and costly or impossible to remediate, including: • alleged or actual failures by us, our Affiliates or our respective employees to comply with applicable laws, rules or regulations; • errors in our public reports; • cyber-attack or data breach incidents; • fund liquidity or valuation issues including with respect to non-traded, illiquid assets within funds or products of certain of our Affiliates; • threatened or actual litigation against us, any of our Affiliates or our respective employees; • perceived or actual conflict between us and any of our Affiliates or among our Affiliates; • negative perceptions of our or certain of our Affiliates’ investments or business practices by stakeholder groups who have increasingly expressed divergent views on a range of environmental, social, and governance (“ESG”) matters; or • other events and factors that are difficult to predict including those that could impact our Affiliates’ ability to compete effectively with other firms, our ability to successfully pursue our growth strategy, and other risks described elsewhere in this “Risk Factors” section.
Biggest changeOur and our Affiliates’ reputations are critical to our business and could be impacted by events that may be difficult or impossible to control, and costly or impossible to remediate, including: • alleged or actual failures by us, our Affiliates, or our respective employees to comply with applicable laws, rules, or regulations; • errors in our public reports; • cyber-attack or data breach incidents; • fund liquidity or valuation issues, or issues relating to the use of leverage, including with respect to assets within private markets funds, liquid alternatives, or similar products of certain of our Affiliates; • threatened or actual litigation against us, any of our Affiliates, or our respective employees; • perceived or actual conflict between us and any of our Affiliates or among our Affiliates; • negative perceptions of our or certain of our Affiliates’ investments or business practices by stakeholder groups who have increasingly expressed divergent views on a range of environmental, social, and governance matters; • fraudulent impersonations of us, our Affiliates, or members of our management by third-party bad actors, including in social engineering schemes that attempt to manipulate targeted recipients into participating in fraudulent investments, purport to offer investment services, or solicit fraudulent investments, including through fake websites and on social media platforms and messaging applications; or • other events and factors that are difficult to predict including those that could impact our Affiliates’ ability to compete effectively with other firms, our ability to successfully pursue our growth strategy, and other risks described elsewhere in this “Risk Factors” section.
Further, if we, any of our Affiliates or our respective employees or third-party service providers were to fail to comply with applicable laws, rules, or regulations, or be named as a subject of an investigation or other regulatory action, the public announcement and potential publicity surrounding any such investigation or action could have an adverse effect on our or our Affiliates’ reputations and on our stock price and result in increased costs, even if we, our Affiliates, or our respective employees or third-party service providers were found not to have violated such laws, rules or regulations.
Further, if we, any of our Affiliates, or our respective employees or third-party service providers were to fail to comply with applicable laws, rules, or regulations, or be named as a subject of an investigation or other regulatory action, the public announcement and potential publicity surrounding any such failure, investigation, or action could have an adverse effect on our or our Affiliates’ reputations and on our stock price and result in increased costs, even if we, our Affiliates, or our respective employees or third-party service providers were found not to have violated such laws, rules, or regulations.
Our Affiliates’ ability to maintain current fee levels depends on a number of factors, including our Affiliates’ investment performance, as well as competition and trends in the investment management industry, such as investor demand for passively-managed products, including index and exchange traded funds, that typically carry lower fee rates, or preferences for other developing strategies or trends.
Our Affiliates’ ability to grow or maintain current fee levels depends on a number of factors, including our Affiliates’ investment performance, as well as competition and trends in the investment management industry, such as investor demand for passively-managed products, including index and exchange traded funds, that typically carry lower fee rates, or preferences for other developing strategies or trends.
See “Competition” in Item 1. Our Affiliates may not compare favorably with their competitors in any or all of these categories, and technological developments, including financial applications and services based on artificial intelligence (“AI”), may over time reduce the demand for, or clients’ willingness to pay for, certain products and services.
See “Competition” in Item 1. Our Affiliates may not compare favorably with their competitors in any or all of these categories, and technological developments, including financial applications and services based on generative artificial intelligence (“AI”) , may over time reduce the demand for, or clients’ willingness to pay for, certain products and services.
Further, we seek to attract and retain our key officers and employees through a number of initiatives and programs, including developing a strong values-based culture, a commitment to career development, employee engagement, attractive compensation and benefits programs, attention to succession planning, and fostering of diversity and inclusion, any of which may not be successful in contributing to the retention of such employees.
Further, we seek to attract and retain our key officers and employees through a number of initiatives and programs, including developing a strong values-based culture, a commitment to career development, employee engagement, attractive compensation and benefits programs, attention to succession planning, and fostering of organizational diversity, any of which may not be successful in contributing to the retention of such employees.
In addition, announcements of our financial and operating results or other material information, including changes in net client cash flows and assets under management, announcements and activity regarding our share repurchase programs, changes in our financial guidance or our failure to meet such guidance, our new investments activity, changes in general conditions in the economy or the financial markets, perceptions regarding our ESG profile or sustainable investment decisions of our Affiliates, and other developments affecting us, our Affiliates or our competitors, as well as geopolitical, social, regulatory, capital markets, economic, public health, and other factors unrelated to us, could cause the market price of our common stock to fluctuate substantially.
In addition, announcements of our financial and operating results or other material information, including changes in net client cash flows and assets under management, announcements and activity regarding our share repurchase programs, changes in our financial guidance or our failure to meet such guidance, our new investments activity, changes in general conditions in the economy or the financial markets, perceptions regarding our environmental, social, and governance profile or sustainable investment decisions of our Affiliates, and other developments affecting us, our Affiliates, or our competitors, as well as geopolitical, social, regulatory, capital markets, economic, public health, and other factors unrelated to us, could cause the market price of our common stock to fluctuate substantially.
The breach of any covenant (either due to our actions or omissions or, in the case of financial covenants, due to a significant and prolonged market-driven decline in our operating results) could result in a default under the applicable debt agreement and, in the case of our credit facilities, lenders could refuse to make further extensions of credit to us.
The breach of any covenant (either due to our actions or omissions or, in the case of financial covenants, due to a significant and prolonged market-driven decline in our operating results) could result in a default under the applicable debt agreement and, in the case of our revolver, lenders could refuse to make further extensions of credit to us.
Recent well-publicized security breaches at other companies have exemplified security-related vulnerabilities, and may lead to further government and regulatory scrutiny and heightened security requirements both in the U.S. and in other jurisdictions in which we and our Affiliates operate. Item 1B. Unresolved Staff Comments None.
Recent well-publicized security breaches and service outages at other companies have exemplified security-related vulnerabilities, and may lead to further government and regulatory scrutiny and heightened security requirements both in the U.S. and in other jurisdictions in which we and our Affiliates operate. Item 1B. Unresolved Staff Comments None.
As 15 Table of Contents a consequence, our financial condition and results of operations may be adversely affected by problems stemming from the day-to-day operations of our Affiliates that we are not involved in, and where weaknesses or failures in internal processes or systems, legal or regulatory matters, or other operational challenges could lead to a disruption or cessation of our Affiliates’ operations, liability to their clients, exposure to claims or disciplinary action, or reputational harm.
As a consequence, our financial condition and results of operations may be adversely affected by problems stemming from the day- to-day operations of our Affiliates that we are not involved in, and where weaknesses or failures in internal processes or systems, legal or regulatory matters, or other operational challenges could lead to a disruption or cessation of our Affiliates’ operations, liability to their clients, exposure to claims or disciplinary action, or reputational harm.
Our debt agreements contain customary affirmative operating covenants and negative covenants that, among other things, place certain limitations on our and our subsidiaries’ ability to incur debt, merge or transfer assets, and create liens and, in the case of our credit facilities, require us to maintain specified financial ratios, including a maximum leverage ratio and a minimum interest coverage ratio.
Our debt agreements contain customary affirmative operating covenants and negative covenants that, among other things, place certain limitations on our and our subsidiaries’ ability to incur debt, merge or transfer assets, and create liens and, in the case of our revolver, require us to maintain specified financial ratios, including a maximum leverage ratio and a minimum interest coverage ratio.
Although we use a combination of economic incentives, transfer restrictions and, in some instances, non-solicitation, non-competition, and 12 Table of Contents employment agreements in an effort to retain key Affiliate personnel, there is no guarantee that these principals will remain with their firms or refrain from competing with us if they depart their firms.
Although we use a combination of economic incentives, transfer restrictions and, in some instances, non-solicitation, non-competition, and employment agreements in an effort to retain key Affiliate personnel, there is no guarantee that these principals will remain with their firms or refrain from competing with us if they depart their firms.
The total level of our assets under management generally or with respect to particular products or Affiliates could be adversely affected by conditions outside of our control, including: • a decline in the market value of our assets under management, due to declines or heightened volatility in the capital markets, fluctuations in foreign currency exchange rates and interest rates, the recent inflationary environment, changes in the yield curve, and other market factors; • changes in investor risk tolerance or investment preferences, which could result in investor allocations away from strategies and products offered by our Affiliates; 7 Table of Contents • our Affiliates’ ability to attract and retain client assets and market products and services, which may be impacted by investment performance, client relationships, demand for product and service offerings, their continued development of products to meet the changing demands of investors, and the prices of securities generally; • global economic conditions, which may be exacerbated by changes in the equity or debt markets, including impacts from monetary policies of the U.S.
The total level of our assets under management generally or with respect to particular products or Affiliates could be adversely affected by conditions outside of our control, including: • a decline in the market value of our assets under management, due to declines or heightened volatility in the capital markets, fluctuations in foreign currency exchange rates and interest rates, inflation, changes in the yield curve, and other market factors; • changes in investor risk tolerance or investment preferences, which could result in investor allocations away from strategies and products offered by our Affiliates; 8 Table of Contents • our Affiliates’ ability to attract and retain client assets and market products and services, which may be impacted by investment performance, client relationships, demand for product and service offerings, their continued development of products to meet the changing demands of investors, and the prices of securities generally; • global economic conditions, which may be exacerbated by changes in the equity or debt markets, including impacts from shifting monetary policies of the U.S.
Further, we and our Affiliates rely on third parties for certain aspects of our respective businesses, including financial intermediaries, providers of 16 Table of Contents technology infrastructure, and other service providers such as broker-dealers, custodians, administrators and other agents, as well as accounting, legal, and other professional advisors, and these parties are susceptible to similar risks.
Further, we and our Affiliates rely on third parties for certain aspects of our respective businesses, including financial intermediaries, providers of technology infrastructure, and other service providers such as broker-dealers, custodians, administrators and other agents, as well as accounting, legal, and other professional advisors, and these parties are susceptible to similar risks.
A reduction in our credit ratings could also increase our borrowing costs under our credit facilities or, in certain cases, give rise to a termination right by the counterparty under our derivative financial instruments. There can be no assurance that we will achieve a particular credit rating or maintain any particular rating in the future.
A reduction in our credit ratings could also increase our borrowing costs under our revolver or, in certain cases, give rise to a termination right by the counterparty under our derivative financial instruments, if any. There can be no assurance that we will achieve a particular credit rating or maintain any particular rating in the future.
In recent periods, we have recorded expenses to reduce the carrying value to fair value of certain Affiliates and certain acquired client relationships, and may experience similar impairment events in future reporting periods. See “Critical Accounting Estimates and Judgments” in Item 7 and Notes 8 and 9 of the Consolidated Financial Statements.
In prior periods, we have recorded expenses to reduce the carrying value to fair value of certain Affiliates and certain acquired client relationships, and may experience similar impairment events in future reporting periods. See “Critical Accounting Estimates and Judgments” in Item 7 and Notes 7 and 8 of the Consolidated Financial Statements.
Such capital requirements may be increased from time to time, which may have the effect of limiting withdrawals of capital and the payment of distributions to us or, if there were a significant change in the required capital or an extraordinary loss or charge against net capital at a particular Affiliate, could adversely impact such Affiliate’s ability to expand or maintain operations.
Such capital requirements may be increased from time to time with limited advance notice, which may have the effect of limiting withdrawals of capital and the payment of distributions to us or, if there were a significant change in the required capital or an extraordinary loss or charge against net capital at a particular Affiliate, could adversely impact such Affiliate’s ability to expand or maintain operations.
The investment management industry is highly competitive. Our Affiliates compete with numerous investment management firms globally, including public, private and client-owned investment advisers; firms managing passively-managed products, including exchange traded funds; firms associated with securities broker-dealers, financial institutions, insurance companies, private equity firms, sovereign wealth funds; and other entities.
The investment management industry is highly competitive. Our Affiliates compete with numerous investment management firms globally, including public, private and client-owned investment advisers; firms managing passively-managed products, including exchange traded funds; firms associated with 9 Table of Contents securities broker-dealers, financial institutions, insurance companies, private equity firms, sovereign wealth funds; and other entities.
In addition, our access to additional capital, and the cost of capital we are able to access, is influenced by a number of factors, including the state of global credit and equity markets, interest rates, credit spreads and our credit ratings.
In addition, our access to additional capital, and the cost of capital we are 10 Table of Contents able to access, is influenced by a number of factors, including the state of global credit and equity markets, interest rates, credit spreads and our credit ratings.
Applicable laws, rules and regulations impose requirements, restrictions, and limitations on our and our Affiliates’ businesses, and can result in significant compliance costs. Further, this regulatory environment may be altered without notice by new laws or regulations, revisions to existing laws or regulations, or new or revised interpretations, guidance or enforcement priorities.
Applicable laws, rules and regulations impose requirements, restrictions, and limitations on our and our Affiliates’ businesses, and can result in significant compliance and operational costs. Further, this regulatory environment may be altered without notice by new laws or regulations, revisions to existing laws or regulations, or new or revised interpretations, g uidance, or enforcement priorities.
Our debt agreements impose certain covenants relating to the conduct of our business, including financial covenants under our credit facilities, any breach of which could result in the acceleration of the repayment of any amounts borrowed or outstanding thereunder.
Our debt agreements impose certain covenants relating to the conduct of our business, including financial covenants under our revolver, any breach of which could result in the acceleration of the repayment of any amounts borrowed or outstanding thereunder.
Further, given our long-term innovative partnership approach with our Affiliates, which is designed to maintain their independence and autonomy, and, therefore, their unique entrepreneurial and investment-centric cultures, a change in control may be viewed negatively by our Affiliates, impacting their relationships with us.
Further, given our long-term innovative partnership approach with our Affiliates, which is designed to maintain their independence and autonomy, and, therefore, their unique entrepreneurial and investment-centric cultures, a change in control 14 Table of Contents may be viewed negatively by our Affiliates, impacting their relationships with us.
These risks may include difficulties in staffing and managing foreign operations, longer payment cycles, difficulties in collecting investment advisory fees receivable, different (and in some cases less stringent) legal, regulatory and accounting regimes, political instability, 14 Table of Contents exposure to fluctuations in currency exchange rates, expatriation controls, expropriation risks, and potential adverse tax consequences.
These risks may include difficulties in staffing and managing foreign operations, longer payment cycles, difficulties in collecting investment advisory and other fees receivable, different (and in some cases less stringent) legal, regulatory and accounting regimes, political instability, exposure to fluctuations in currency exchange rates, expatriation controls, expropriation risks, and potential adverse tax consequences.
We have substantial intangibles on our balance sheet, and any impairment of our intangibles could adversely affect our financial condition and results of operations. As of December 31, 2023, our total assets were $9.1 billion, of which $4.3 billion were intangibles, and $2.3 billion were equity method investments in Affiliates, an amount primarily composed of intangible assets.
We have substantial intangibles on our balance sheet, and any impairment of our intangibles could adversely affect our financial condition and results of operations. As of December 31, 2024 , our total assets were $8.8 billion , of which $4.3 billion were intangibles, and $2.2 billion were equity method investments in Affiliates, an amount primarily composed of intangible assets.
More recently, the SEC has implemented new rules related to cybersecurity risk management for public companies and is expected to implement similar new rules for registered investment advisers, broker-dealers, and funds, which have resulted or may result, as applicable, in increased disclosure requirements, obligations to report certain cybersecurity incidents to the SEC, and liabilities related to our and our Affiliates’ technology systems and networks.
More recently, the SEC has implemented new rules related to 18 Table of Contents cybersecurity risk management for public companies and may implement similar new rules for registered investment advisers, broker-dealers, and funds, which have resulted or may result, as applicable, in increased disclosure requirements, obligations to report certain cybersecurity incidents to the SEC, and liabilities related to our and our Affiliates’ technology systems and networks.
The advancement of AI has given rise to additional vulnerabilities and potential entry points for cyber threats, providing threat actors with additional tools to automate attacks, evade detection, or generate sophisticated phishing emails.
The advancement of AI has given rise to additional vulnerabilities and potential entry points for cyber threats, providing threat actors with additional tools to automate attacks, evade detection, generate sophisticated phishing emails, or impersonate legitimate businesses or individuals.
These firms may also compete by seeking to capitalize on a trend towards institutions consolidating the 8 Table of Contents number of investment managers they work with.
These firms may also compete by seeking to capitalize on a trend towards institutions consolidating the number of investment managers they work with.
Further, while hedging arrangements may reduce certain risks, such arrangements themselves may entail other risks, may generate significant 10 Table of Contents transaction costs, and may require the posting of cash collateral.
Further, while hedging arrangements may reduce certain risks, such arrangements themselves may entail other risks, may generate significant transaction costs, and may require the posting of cash collateral.
While we currently believe that our and our Affiliates’ operational controls are effective, we cannot provide assurance that those controls, procedures, policies, and systems will always be adequate to identify and manage the internal and external risks in our and our Affiliates’ various businesses.
While we currently believe that our and our Affiliates’ operational controls, including controls over compliance and over financial reporting, are effective, we cannot provide assurance that those controls, procedures, policies, and systems will always be adequate to identify and manage the internal and external risks in our and our Affiliates’ various businesses.
For some of our Affiliates, performance-based fees include a high-watermark provision, which generally provides that if a product underperforms on an absolute basis or relative to its benchmark, it must regain such underperformance before the Affiliate will earn any performance-based fees.
For some of our Affiliates, performance- based fees include benchmarks, such as a high-watermark provision, which generally provide that if a product underperforms on an absolute basis or relative to a specified benchmark, it must regain such underperformance before the Affiliate will earn any performance-based fees.
Any failure to successfully execute on strategic partnerships or transactions, including in connection with our entry into new operational areas or effectively managing associated risks, could harm our reputation and expose us to additional costs, which could adversely affect our assets under management, financial condition, and results of operations.
Any failure to successfully execute on strategic partnerships, transactions, or initiatives, including in connection with our entry into new operational areas or effectively managing associated risks, or by our Affiliates in deploying strategic capital into suitable new investment opportunities, could harm our reputation and expose us to additional costs, which could adversely affect our assets under management, financial condition, and results of operations.
Further, we also conduct distribution, sales, and marketing activities through our U.S. wealth and global distribution platforms to extend the reach of our Affiliates’ own business development efforts, and any liability arising in connection with these activities, whether as a result of our own actions or the actions of our participating Affiliates or third-party service providers, could result in direct liability to us.
Further, we also conduct compliance, governance, and operational activities, including with respect to distribution, sales, and marketing, through our U.S. wealth and global distribution platforms to extend the reach of our Affiliates, and any liability arising in connection with these activities, whether as a result of our own actions or the actions of our participating Affiliates or third-party service providers, could result in direct liability to us.
The increasing frequency and sophistication of these cyber threats, including in foreign jurisdictions in which we and our Affiliates operate, along with the continued reliance on work-from-home environments, personal mobile and computing technologies, and third-party web conferencing services, have increased exposures to these security-related risks.
The increasing frequency, scope, and sophistication of these cyber threats, and involvement of large criminal organizations that share tactics and strategies, including in foreign jurisdictions in which we and our Affiliates operate, along with the continued reliance on work-from-home environments, personal mobile and computing technologies, and third-party web conferencing services, have increased exposures to these security-related risks.
Our level of indebtedness may increase if we fund future investments or other expenses through borrowings. We may also seek to refinance existing indebtedness for the purpose of managing maturity dates, to seek alternative financing terms or for other reasons, which may not be available on similar terms as our existing indebtedness, including with respect to interest rates.
We may also seek to refinance existing indebtedness for the purpose of managing maturity dates, to seek alternative financing terms or for other reasons, which may not be available on similar terms as our existing indebtedness, including with respect to interest rates.
The structure of our partnership interests in our Affiliates may expose us to unanticipated changes in Affiliate revenue, operating expenses, and other commitments, which we may not anticipate and may have limited ability to control.
The structure of our partnership interests in our Affiliates may expose us to unanticipated changes in Affiliate revenue, operating expenses, and other commitments, which we may not anticipate and may have limited ability to control. The form of our structured partnership interests in our Affiliates differs from Affiliate to Affiliate, and may change during the course of our investment.
In these types of structures, while our distributions generally have priority, our agreed allocations may not anticipate changes in the revenue and operating expense base of the Affiliate, and the revenue remaining after our specified share is allocated to us may not be large enough to cover all of the Affiliate’s operating expenses, which could result in a reduction of the amount allocated to us or could negatively impact the Affiliate’s operations and prospects. 11 Table of Contents Where we share in the Affiliate’s revenue less agreed-upon expenses, we benefit from any increase in revenue or any decrease in the agreed-upon expenses, but also have exposure to any decrease in revenue or any increase in such expenses.
In these types of structures, while our distributions generally have priority, our agreed allocations may not anticipate changes in the revenue and operating expense base of the Affiliate, and the revenue remaining after our specified 12 Table of Contents share is allocated to us may not be large enough to cover all of the Affiliate’s operating expenses, which could result in a reduction of the amount allocated to us or could negatively impact the Affiliate’s operations and prospects.
As of December 31, 2023, the current redemption value relating to Affiliate equity interests was $447.3 million, of which $393.4 million was presented as Redeemable non-controlling interests (including $11.8 million of consolidated Affiliate sponsored investment products primarily attributable to third-party investors), and $53.9 million was included in Other liabilities.
As of December 31, 2024 , the current redemption value relating to Affiliate equity interests was $405.3 million , of which $350.5 million was presented as Redeemable non-controlling interests (including $12.9 million of consolidated Affiliate sponsored investment products primarily attributable to third-party investors), and $54.8 million was included in Other liabilities.
See “Liquidity and Capital Resources-Affiliate Equity” in Item 7 and Notes 16 and 17 of the Consolidated Financial Statements. Unfunded commitments relating to general partner and seed capital investments were $187.2 million as of December 31, 2023. See Notes 3 and 7 of the Consolidated Financial Statements.
See “Liquidity and Capital Resources-Affiliate Equity” in Item 7 and Notes 15 and 16 of the Consolidated Financial Statements. Unfunded commitments relating to general partner and seed capital investments were $236.5 million as of December 31, 2024 . See Notes 2 and 6 of our Consolidated Financial Statements.
Where we share in the Affiliate’s revenue without regard to expenses, the Affiliate allocates a specified percentage of its revenue to us and Affiliate management, while using the remainder for operating expenses and additional distributions to Affiliate management.
In the case of structures where we contractually share in the Affiliate’s revenue without regard to expenses, comprising Affiliates that contribute a majority of our Consolidated revenue, the Affiliate allocates a specified percentage of its revenue to us and Affiliate management, while using the remainder for operating expenses and additional distributions to Affiliate management.
Any changes to federal, state or foreign tax laws, regulations, accounting standards or administrative practices, or the release of additional guidance, interpretations or other information, including in connection with Pillar Two or otherwise, could impact our estimated effective tax rate and overall tax expense, as well as our earnings estimates, and could result in adjustments to our treatment of deferred taxes, including the realization or value thereof, or in unanticipated additional tax liabilities, any of which could have an adverse effect on our business, financial condition, and results of operations.
We cannot predict future changes in the tax laws, regulations, administrative guidance, or judicial decisions to which we and our Affiliates are subject or that could apply to our and our Affiliates’ businesses, and any changes to federal, state or foreign tax laws, regulations, accounting standards or administrative practices, or the release of additional guidance, interpretations or other information, including in connection with Pillar Two or otherwise, could impact our estimated effective tax rate and overall tax expense, as well as our earnings estimates, and could result in adjustments to our treatment of deferred taxes, including the realization or value thereof, or in unanticipated additional tax liabilities, any of which could have an adverse effect on our business, financial condition, and results of operations. 16 Table of Contents In addition, we and our Affiliates may be subject to tax examinations by certain federal, state, and foreign tax authorities.
These initiatives involve risks and uncertainties and may require resources and investment, including the implementation of new operational controls and procedures, compliance with additional regulatory and disclosure requirements, exposure to more volatile market segments and reputational risks, and require complex contractual arrangements and specialized skills, and there is no certainty that such initiatives will deliver the anticipated benefits over the expected time frame or at all, or that our stockholders will react favorably.
Addressing these risks and uncertainties may require additional resources and investment, including the implementation of new operational controls and procedures, as well as require complex contractual arrangements, structures, and specialized skills. There is no certainty that such initiatives will deliver the anticipated benefits over the expected time frame or at all, or that our stockholders will react favorably.
Federal Reserve Bank and other global central banks in response to inflation, or instability and liquidity issues in the financial system generally; • financial crises, political or diplomatic developments in the U.S. or globally, including rising trade tensions between the U.S. and China, pandemics or other public health crises, trade wars, social or civil unrest, insurrection, war, terrorism, natural disasters, or risks associated with global climate change; and • other factors that are difficult to predict.
Federal Reserve Bank and other global central banks, or instability and liquidity issues in the financial system generally; • financial crises, political or diplomatic developments in the U.S. or globally, including uncertainties regarding actual and potential changes in domestic, foreign, trade, economic, and other policies, trade tensions, public health crises, civil unrest, war, terrorism, natural disasters, or risks associated with global climate change; and • other factors that are difficult to predict.
If our or our Affiliates’ reputations are harmed, we could suffer losses in our business and financial results. The success of our business depends on earning and maintaining the trust and confidence of our Affiliates and our stockholders, our ability to compete for future investment opportunities, and our and our Affiliates’ reputations among existing and potential clients.
The success of our business depends on earning and maintaining the trust and confidence of our Affiliates and our stockholders, our ability to compete for future investment opportunities, and our and our Affiliates’ reputations among existing and potential clients.
For example, in October 2021, the Organization for Economic Co-operation and Development (“OECD”) agreed to a two-pillar approach to global taxation focusing on global profit allocation, referred to as Pillar One, and a global minimum corporate tax rate (“Pillar Two”).
For example, the Organization for Economic Co- operation and Development (“OECD”) has agreed to a two-pillar approach to global taxation focusing on global profit allocation, referred to as Pillar One, and a 15% global minimum corporate tax rate (“Pillar Two”), effective for fiscal years beginning on or after December 31, 2023.
In addition, in the ordinary course of business, our Affiliates may reduce or waive fees on certain products for particular time periods, to attract or retain assets or for other reasons. No assurances can be given that our Affiliates will be able to maintain current fee structures or levels.
In addition, in the ordinary course of business, our Affiliates may reduce or waive fees on certain products for particular time periods, to attract or retain assets or for other reasons.
These types of ESG-related regulations could impact our or our Affiliates’ businesses, increase regulatory and compliance costs, and adversely affect our profitability, which effects could be exacerbated in the event of regulatory uncertainty or conflicting or inconsistent regulatory guidance related thereto.
The dynamic nature of environmental, social, and governance-related regulations could impact our or our Affiliates’ businesses, increase regulatory and compliance costs, and adversely affect our profitability, which effects could be exacerbated in the event of regulatory uncertainty or conflicting or inconsistent regulatory guidance related thereto, including in the U.S. and the UK, as applicable.
These firms may have significantly greater financial, technological, and marketing resources, captive distribution and assets under management, and many of these firms may offer products and services that our Affiliates may not in particular investment strategies.
These firms may have significantly greater financial, technological, and marketing resources, captive distribution and assets under management, or be subject to less regulation and accordingly have more flexibility to undertake and execute certain investments with less compliance expense, and many of these firms may offer products and services that our Affiliates may not in particular investment strategies.
Any of the forgoing factors may inhibit a change in control in circumstances that could give our stockholders the opportunity to realize a premium over the market price of our common stock, or may result in negative impacts on our financial results in periods prior to and following a change in control. 13 Table of Contents In addition, a change in control of the Company or the acquisition of a large ownership position in shares of our outstanding common stock by a single holder may constitute a change in control for certain of our Affiliates for purposes of the Advisers Act and the Investment Company Act.
Any of the forgoing factors may inhibit a change in control in circumstances that could give our stockholders the opportunity to realize a premium over the market price of our common stock, or may result in negative impacts on our financial results in periods prior to and following a change in control.
Further, in recent years, regulators in the U.S., the UK, and other jurisdictions have expanded rules and devoted greater resources and attention to the enforcement of anti-bribery and anti-money laundering laws, and while we and our Affiliates have developed and implemented policies and procedures designed to comply with these rules, such policies and procedures may not be effective in all instances to prevent violations.
These and other regulatory developments could adversely affect our and our Affiliates’ businesses, increase compliance and operational costs, require that we or our Affiliates change or curtail operations or investment offerings, or impact our and our Affiliates’ access to capital and the market for our common stock. 15 Table of Contents Further, in recent years, regulators in the U.S., the UK, and other jurisdictions have expanded rules and devoted greater resources and attention to the enforcement of anti-bribery and anti-money laundering laws, and while we and our Affiliates have developed and implemented policies and procedures designed to comply with these rules, such policies and procedures may not be effective in all instances to prevent violations.
Changes in our management team, in particular, may be disruptive to our business, and failure to attract and retain members of our executive or senior management team, or to effectively implement and manage appropriate succession plans, could adversely affect our business, financial condition, and results of operations.
Changes in our management team, in particular, may be disruptive to our business, and failure to attract and retain members of our executive or senior management team, or to effectively implement and manage appropriate succession plans, could adversely affect our business, financial condition, and results of operations. 13 Table of Contents In addition, our Affiliates depend heavily on the services of key principals who, in many cases, have managed their firms for many years.
The degree of our exposure to agreed-upon expenses from these structured partnership interests varies by Affiliate and includes several Affiliates in which we fully share in the expenses of the business. In these types of structures, we may have limited or no ability to control the level of expenses at the Affiliate, and our distributions generally do not have priority.
The degree of our exposure to agreed-upon expenses from these structured partnership interests varies by Affiliate (and may change during the course of our investment), and includes several Affiliates in which we fully share in the expenses of the business.
In the U.S., the Inflation Reduction Act included significant budget increases for tax audit and enforcement, and similar trends have developed in foreign jurisdictions. There can be no assurance that we will accurately predict the outcomes of any examinations and the actual outcomes could have an adverse impact on our financial condition and results of operations.
There can be no assurance that we will accurately predict the outcomes of any examinations and the actual outcomes could have an adverse impact on our financial condition and results of operations.
If new tax reform proposals are introduced in the U.S., they could materially impact our tax provision, deferred tax assets, tax liabilities, tax credit planning, and effective tax rate, or impact decisions on how to return value to stockholders in the most efficient manner.
In the U.S., the new presidential administration has indicated that it may pursue various tax reform proposals, which, if ultimately enacted into legislation, could materially impact our tax provision, deferred tax assets, and tax liabilities, or impact decisions on how to return value to stockholders in the most efficient manner.
For example, if our or our Affiliates’ counterparties fail to honor their obligations in a timely manner, including any obligations to return posted collateral, our liquidity and results of operations could be adversely impacted.
For example, if our or our Affiliates’ counterparties fail to honor their obligations in a timely manner, including any obligations to return posted collateral, our liquidity and results of operations could be adversely impacted. 11 Table of Contents RISKS RELATED TO OUR STRATEGY AND OUR STRUCTURED PARTNERSHIPS WITH AFFILIATES Our growth strategy depends in part upon our ability to identify and consummate investments in suitable independent investment firms.
A reduction in our assets under management could adversely affect the fees payable to our Affiliates and, ultimately, our financial condition and results of operations. To the extent any of these conditions or factors adversely affect our or our Affiliates’ operations or global economic conditions generally, they may also have the effect of heightening other risks described below.
To the extent any of these conditions or factors adversely affect our or our Affiliates’ operations or global economic conditions generally, they may also have the effect of heightening other risks described elsewhere in this “Risk Factors” section. If our or our Affiliates’ reputations are harmed, we could suffer losses in our business and financial results.
We may need to raise additional capital in the future, and existing or future resources may not be available to us in sufficient amounts or on acceptable terms.
In addition, investment management contracts with mutual funds or other similar products are subject to annual approval by the fund’s board of directors. We may need to raise additional capital in the future, and existing or future resources may not be available to us in sufficient amounts or on acceptable terms.
Thus, we may need to raise capital through additional borrowings or by selling shares of our common stock or other equity or debt securities, or otherwise refinance a portion of these obligations. 9 Table of Contents As of December 31, 2023, we had outstanding debt of $2.6 billion.
These obligations may require more cash than is then available from our existing cash resources and cash flows from operations. Thus, we may need to raise capital through additional borrowings or by selling shares of our common stock or other equity or debt securities, or otherwise refinance a portion of these obligations.
The financial and reputational impact of control failures can be significant. In addition, our and our Affiliates’ businesses and the markets in which we and our Affiliates operate are continuously evolving. For example, the use of generative AI technologies by us, our Affiliates, or our respective third-party service providers could result in new and expanded risks.
The financial and reputational impact of control failures can be significant. 17 Table of Contents In addition, our and our Affiliates’ businesses and the markets in which we and our Affiliates operate are continuously evolving.
For example, regulations in the European Union (the “EU”) pertaining to integrating ESG topics may materially impact the investment management industry in member states that have adopted, or may in the future adopt, such legislation.
For example, regulations in the European Union (the “EU”) pertaining to the integration of environmental, social, and governance topics into, among other things, the organizational, risk, and governance arrangements of certain financial entities, and increased disclosure requirements with regard to such factors generally, may materially impact the investment management industry in member states that have adopted, or may in the future adopt, such legislation.
Further, the impact of Affiliate expenses on our earnings and our stock price could increase if the portion of our earnings derived from such Affiliates increases.
In these types of structures, we may have limited or no ability to control the level of expenses at the Affiliate, and our distributions generally do not have priority. Further, the impact of Affiliate expenses on our earnings and our stock price could increase if the portion of our earnings derived from such Affiliates increases.
A reduction in the fees that our Affiliates receive could have an adverse impact on our financial condition and results of operations.
A reduction in our assets under management could adversely affect the fees payable to our Affiliates and, ultimately, our financial condition and results of operations.
Our growth strategy also includes pursuing strategic partnerships and transactions in areas where we can assist our Affiliates in growing and diversifying their businesses to further enhance our competitive position, which may involve new operational areas, product structures or strategies, and expanding the geography and scope of our operations.
Our growth strategy also includes selectively pursuing strategic partnerships, transactions, and initiatives in areas where we can assist our Affiliates in growing and diversifying their businesses (including through seed capital, general partner commitments, and other strategic investments in our Affiliates and their funds), to further enhance our competitive position, or where we believe we can add value and generate meaningful returns.
In December 2022, the EU agreed to implement the OECD’s global minimum corporate tax rate of 15% under Pillar Two, effective January 2024. Other countries, including jurisdictions in which we or our Affiliates do business, are also considering changes to their tax laws to adopt certain portions of the OECD’s proposals.
Many countries, including jurisdictions in which we or our Affiliates do business, are enacting changes to their tax laws to adopt certain portions of the OECD’s proposals. The potential effects may vary depending on the specific provisions and rules implemented by each jurisdiction.
If our Affiliates’ clients terminate their investment management contracts or withdraw a substantial amount of assets, it is likely to harm our results of operations. In addition, investment management contracts with mutual funds or other similar products are subject to annual approval by the fund’s board of directors.
If our Affiliates’ clients, in particular a significant client or a series of significant clients, terminate their investment management contracts or withdraw a substantial amount of assets for any number of reasons, including poor investment performance, loss of key investment personnel, changes in the client’s decision makers, or reputational, regulatory, or compliance issues, it is likely to harm our results of operations.
In addition, our Affiliates depend heavily on the services of key principals who, in many cases, have managed their firms for many years. These principals often are primarily responsible for their firm’s investment decisions.
These principals often are primarily responsible for their firm’s investment decisions.
Removed
Valuation methodologies for assets within private markets funds, liquid alternatives, and similar products of certain of our Affiliates can be subject to significant subjectivity. Certain of our Affiliates offer private markets, liquid alternative, and other strategies that may invest in assets for which there may be no readily ascertainable market prices available on a regular basis or at all.
Added
No assurances can be given that our Affiliates will be able to grow or maintain current fee structures or levels, or that certain strategies they offer will be in demand at any given time. A reduction in the fees that our Affiliates receive could have an adverse impact on our financial condition and results of operations.
Removed
In addition, many of these investments are, or may in the future be, concentrated in industries or sectors that could experience volatility or uncertainties, and may be subject to rapid changes in value caused by company-specific or industry-wide developments.
Added
As of December 31, 2024 , we had outstanding debt of $2.7 billion . Our level of indebtedness may increase if we fund future investments or other expenses through borrowings.
Removed
The determination of the net asset values for these funds, therefore, takes a range of factors into consideration in applying valuation methodologies, and may reflect estimates or valuation models of independent third parties.
Added
Our growth strategy also includes selectively pursuing strategic partnerships, transactions, and initiatives, which could involve additional risks and uncertainties.
Removed
These valuation methodologies require the use of estimates and assumptions, and involve a significant degree of judgment and, accordingly, the fair values of such investments reflected in a particular fund or product’s net asset value do not necessarily reflect the prices that would be obtained if the assets were to be liquidated on the date of the valuation, or on the date when an investor purchases, redeems or otherwise transacts in the fund or product, and may differ significantly from the prices obtained when such investments are ultimately realized.
Added
These strategic partnerships, transactions, and initiatives may be complementary to our existing business or involve new operational areas, product structures, or strategies (including in private markets and liquid alternatives), which includes, among others, initiatives to increase the number and type of investment products offered to high-net-worth individuals and families through our U.S. wealth and global distribution platforms, and expanding the geography and scope of our operations.
Removed
These factors could result in reduced earnings or losses for the applicable Affiliate, fund, or product, increase liquidity management risks for the fund or product, or result in difficulties in raising additional capital or launching similar products, any of which could have an adverse effect on our reputation, our financial condition and results of operations, or the market price of our common stock.
Added
These initiatives involve risks and uncertainties, including compliance with additional regulatory and disclosure requirements, increased potential for disputes, exposure to more volatile market segments and reputational risks, and significant commitments of capital over extended periods of time.
Removed
These obligations may require more cash than is then available from our existing cash resources and cash flows from operations.
Added
In the case of structures where we contractually share in the Affiliate’s revenue less agreed-upon expenses, we benefit from any increase in revenue or any decrease in the agreed-upon expenses, but also have exposure to any decrease in revenue or any increase in such expenses.
Removed
RISKS RELATED TO OUR STRATEGY AND OUR STRUCTURED PARTNERSHIPS WITH AFFILIATES Our growth strategy depends in part upon our ability to make investments in independent investment firms and to pursue other strategic partnerships.
Added
The market for highly skilled professionals in the investment management industry is highly competitive, particularly in alternative strategies.
Removed
The form of our structured partnership interests in our Affiliates differs from Affiliate to Affiliate, and ranges from structures where we contractually share in the Affiliate’s revenue without regard to expenses, comprising Affiliates that contribute a majority of our Consolidated revenue, to others where we contractually share in the Affiliate’s revenue less agreed-upon expenses.
Added
Further, the departure of key individuals at an Affiliate could also cause investors to reduce or terminate their investments in such Affiliates’ funds or products, or trigger certain provisions tied to the departure of, or cessation of committed time, by specified persons (known as “key person” provisions) in the documentation governing certain Affiliate products and funds, which could permit the suspension or termination of those products’ investment periods.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe also have our own fully documented proprietary security incident response plan, with defined roles and responsibilities that address notification obligations and incident response procedures in the event of a data security breach.
Biggest changeIn addition, we require key providers to meet appropriate security requirements and controls, and we investigate security incidents that have impacted our third-party providers, as appropriate. We also have our own fully documented proprietary security incident response plan, with defined roles and responsibilities that address notification obligations and incident response procedures in the event of a data security breach.
Although we provide our Affiliates with operational autonomy in managing their businesses and may have limited involvement in the design, oversight, and maintenance of their respective technology systems and networks, we offer ongoing cybersecurity support to Affiliates through our information security program, including with respect to conducting Affiliate program assessments and assisting, as appropriate and practicable, in their identification of, and response to, an actual or suspected cybersecurity incident.
Although we provide our Affiliates with operational autonomy in managing their businesses and may have limited involvement in the design, oversight, and maintenance of their respective technology systems and networks, we offer cybersecurity support to Affiliates through our information security program, including with respect to conducting Affiliate program assessments and assisting, as appropriate and practicable, in their identification of, and response to, an actual or suspected cybersecurity incident.
We are dedicated to business continuity and resiliency, and have documented strategies, policies, and procedures in place to protect employee, business, Affiliate, and Affiliate client data in the event of an emergency or natural disaster.
We are dedicated to business continuity and resiliency, and have documented strategies, policies, and procedures in place designed to protect employee, business, Affiliate, and Affiliate client data in the event of an emergency or natural disaster.
All of our 17 Table of Contents employees are required to attest annually to our information security policies and participate in regular security awareness training to protect their information and the AMG data and systems to which they have access. These trainings also instruct employees on how to report any potential privacy or data security issues.
All of our employees are required to attest annually to our information security policies and participate in regular security awareness training to protect their information and the AMG data and systems to which they have access. These trainings also instruct employees on how to report any potential privacy or data security issues.
The CIO reports to the Board of Directors as part of the Information Security Governance Committee’s updates discussed above and regularly communicates with the other members of the Information Security Governance Committee and senior management regarding cybersecurity risks. 18 Table of Contents
The CIO reports to the Board of Directors as part of the Information Security Governance Committee’s updates discussed above and regularly communicates with the other members of the Information Security Governance Committee and senior management regarding cybersecurity risks.
Item 1C. Cybersecurity Risk Management and Strategy We regularly assess risks from cybersecurity threats, monitor our information systems for potential vulnerabilities, and test those systems pursuant to our cybersecurity policies, processes, and practices.
Item 1C. Cybersecurity Risk Management and Strategy Our cybersecurity risk management program is integrated into our overall risk management framework. We regularly assess risks from cybersecurity threats, monitor our information systems for potential vulnerabilities, and test those systems pursuant to our cybersecurity policies, processes, and practices.
Refer to the risk factor captioned “Failure to maintain and properly safeguard an adequate technology infrastructure may limit our or our Affiliates’ growth, result in losses or disrupt our or our Affiliates’ businesses” in Part I, Item 1A. “Risk Factors” for more information regarding cybersecurity risks and potential related impacts on AMG.
Refer to the risk factor captioned “Failure to maintain and properly safeguard an adequate technology infrastructure may limit our or our Affiliates’ growth, result in losses or disrupt our or our Affiliates’ businesses” in Part I, Item 1A.
The CIO, in coordination with the Information Security Governance Committee, is responsible for leading the assessment and management of cybersecurity risks. The current CIO has over 25 years of experience in information security.
The CIO , in coordination with the Information Security Governance Committee, is responsible for leading the assessment and management of cybersecurity risks . The current CIO has over 25 years of experience in information security, including serving as our CIO since 2016, and holds a B.A. in Business with a focus in Computer Science.
Governance We have a formal information security program, designed to develop and maintain privacy and data security practices to protect AMG assets and sensitive third-party information, including personal and Affiliate information.
“Risk Factors” for more information regarding cybersecurity risks and potential related impacts on AMG. 19 Table of Contents Governance We have a formal information security program, designed to develop and maintain privacy and data security practices to protect AMG assets and sensitive third-party information, including personal and Affiliate information.
Regular internal and third-party reviews are performed on our processes and technologies to validate the effectiveness of our privacy and data security controls and safeguards. We monitor industry best practices and developments in data privacy and security, including increased scrutiny of third-party service providers with access to sensitive AMG data.
Regular internal and third-party reviews are performed on our processes and technologies to validate the effectiveness of our privacy and data security controls and safeguards.
Added
We monitor industry best practices and developments in data privacy and security and have increased scrutiny of third-party service providers with access to sensitive AMG data, including through security risk assessments at the time of initial contract, periodically as part of our third-party risk management process, and upon detection of an increase in the vendor’s risk profile.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeHowever, there is no assurance as to whether or not any such matters could arise or have a material effect on our or our Affiliates’ financial position, liquidity, or results of operations in any future reporting period. Item 4. Mine Safety Disclosures Not applicable. 19 Table of Contents PART II
Biggest changeHowever, there is no assurance as to whether or not any such matters could arise or have a material effect on our or our Affiliates’ financial position, liquidity, or results of operations in any future reporting period. Item 4. Mine Safety Disclosures Not applicable. 20 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeIssuer Purchases of Equity Securities Period Total Number of Shares Purchased (1) Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Average Price Paid Per Share Maximum Number of Shares that May Yet Be Purchased Under Outstanding Plans or Programs (2) October 1-31, 2023 395,230 $ 126.51 395,230 $ 126.51 4,798,554 November 1-30, 2023 417,793 133.96 417,793 133.96 4,380,761 December 1-31, 2023 185,404 145.53 185,404 145.53 4,195,357 Total 998,427 133.16 998,427 133.16 ___________________________ (1) Includes shares surrendered to the Company to satisfy tax withholding and/or option exercise price obligations in connection with stock swap and option exercise transactions, if any.
Biggest changeIssuer Purchases of Equity Securities Period Total Number of Shares Purchased (1) Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Average Price Paid Per Share Maximum Number of Shares that May Yet Be Purchased Under Outstanding Plans or Programs (2) October 1-31, 2024 . . . . . . . . . . . — $ — — $ — 5,937,859 November 1-30, 2024 . . . . . . . . . 121,762 183.46 121,762 183.46 5,816,097 December 1-31, 2024 . . . . . . . . . 525,507 185.84 525,507 185.84 5,290,590 Total . . . . . . . . . . . . . . . . . . . . . 647,269 185.39 647,269 185.39 ___________________________ (1) Includes shares surrendered to the Company to satisfy tax withholding and/or option exercise price obligations in connection with stock swap and option exercise transaction s, if any.
The following graph compares the cumulative stockholder return on our common stock from December 31, 2018 through December 31, 2023, with the cumulative total return, during the same period, on the Standard & Poor’s MidCap 400 Index, our prior peer group, and our current peer group.
The following graph compares the cumulative stockholder return on our common stock from December 31, 2019 through December 31, 2024 , with the cumulative total return, during the same period, on the Standard & Poor’s MidCap 400 Index, our prior peer group, and our current peer group.
For the years ended December 31, 2021, 2022, and 2023, we repurchased 3.5 million, 4.5 million, and 3.0 million shares of our common stock at an average price per share of $146.54, $144.45, and $132.99, respectively. 20 Table of Contents Performance Graph Our peer group comprises AllianceBernstein Holding L.P., Ares Management Corporation, Artisan Partners Asset Management Inc., Blue Owl Capital Inc., The Carlyle Group Inc., Federated Hermes, Inc., Franklin Resources, Inc., Invesco Ltd., Janus Henderson Group plc, Lazard Ltd., TPG Inc., Victory Capital Holdings, Inc., and Virtus Investment Partners, Inc.
For the years ended December 31, 2022 , 2023 , and 2024 , we repurchased 4.5 million , 3.0 million , and 4.3 million shares of our common stock at an average price per share of $144.45 , $132.99 , and $162.65 , respectively. 21 Table of Contents Performance Graph Our peer group comprises AllianceBernstein Holding L.P., Artisan Partners Asset Management Inc., Blue Owl Capital Inc., The Carlyle Group Inc., Federated Hermes, Inc., Franklin Resources, Inc., Invesco Ltd., Janus Henderson Group plc, Lazard Ltd., TPG Inc., Victory Capital Holdings, Inc., and Virtus Investment Partners, Inc.
The comparison below assumes the investment of $100 on December 31, 2018 in our common stock and each of the comparison indices and, in each case, assumes reinvestment of all dividends. Item 6. [Reserved] 21 Table of Contents
The comparison below assumes the investment of $100 on December 31, 2019 in our common stock and each of the comparison indices and, in each case, assumes reinvestment of all dividends. Item 6. [Reserved] 22 Table of Contents
(2) Our Board of Directors authorized share repurchase programs in January 2022, October 2022, and October 2023 to repurchase up to 2.0 million, 3.0 million, and 3.3 million shares of our common stock, respectively, and these authorizations have no expiry.
(2) Our Board of Directors authorized share repurchase programs in October 2022 , October 2023 , and July 2024 to repurchase up to 3.0 million , 3.3 million , and 5.4 million shares of our common stock, respectively, and these authorizations have no expiry.
As of February 14, 2024, there were 104 stockholders of record , including banks, brokers, and other financial institutions holding shares in omnibus accounts for their customers (in total representing substantially all of the beneficial holders of our common stock).
As of February 12, 2025 , there were 27 stockholders of record , including banks, brokers, and other financial institutions holding shares in omnibus accounts for their customers (in total representing substantially all of the beneficial holders of our common stock).
As of December 31, 2023, we had repurchased all of the shares in the repurchase program authorized in January 2022.
As of March 31, 2024 and December 31, 2024, we had repurchased all of the shares in the repurchase programs authorized in October 2022 and October 2023, respectively .
Removed
Our peer group was revised in 2023 to include two additional alternative-focused asset management companies, Blue Owl Capital Inc. and TPG Inc., to reflect the growing contribution of alternative strategies to our earnings.
Added
Prior to 2024, our peer group also included Ares Management Corporation.
Added
In keeping with i ts regular review and evaluation of the peer group, the Compensation Committee of our Board of Directors further refined our peer group in 2024 to reflect our Company’s growth, overall changes in the asset management industry, and the business models, size, and scope of our competitors.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe following table presents a reconciliation of Net income (controlling interest) to Adjusted EBITDA (controlling interest): For the Years Ended December 31, (in millions) 2021 2022 2023 Net income (controlling interest) $ 565.7 $ 1,145.9 $ 672.9 Interest expense 111.4 114.4 123.8 Income taxes 229.6 347.4 185.2 Intangible amortization and impairments (1) 199.9 195.0 128.5 Affiliate Transactions (2) — (743.6) (162.7) Other items (3) (61.0) (5.3) (12.0) Adjusted EBITDA (controlling interest) $ 1,045.6 $ 1,053.8 $ 935.7 ___________________________ (1) Intangible amortization and impairments in our Consolidated Statements of Income include amortization attributable to the non-controlling interests of our consolidated Affiliates.
Biggest changeAdjusted EBITDA (controlling interest) is also adjusted to include realized economic gains and losses related to these seed capital, general partner commitments, and other strategic investments. 29 Table of Contents The following table presents a reconciliation of Net income (controlling interest) to Adjusted EBITDA (controlling interest): For the Years Ended December 31, (in millions) 2022 2023 2024 Net income (controlling interest) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,145.9 $ 672.9 $ 511.6 Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114.4 123.8 133.3 Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 347.4 185.2 187.9 Intangible amortization and impairments (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195.0 128.5 149.2 Affiliate Transactions (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(4) Other economic items include gains and losses related to contingent payment obligations, tax windfalls and shortfalls from share-based compensation, certain Affiliate equity activity, unrealized gains and losses on seed capital, general partner commitments, and other strategic investments, and realized economic gains and losses related to these seed capital, general partner commitments, and other strategic investments.
(4) Other economic items include certain Affiliate equity activity, gains and losses related to contingent payment obligations, tax windfalls and shortfalls from share-based compensation, unrealized gains and losses on seed capital, general partner commitments, and other strategic investments, and realized economic gains and losses related to these seed capital, general partner commitments, and other strategic investments.
The potential share issuance in connection with our junior convertible securities is measured using a “treasury stock” method. Under this method, only the net number of shares of common stock equal to the value of these junior convertible securities in excess of par, if any, is deemed to be outstanding.
The potential share issuance in connection with our junior convertible securities is measured using a “treasury stock” method. Under this method, only the net number of shares of common stock equal to the value of these junior convertible securities in excess of par, if any, are deemed to be outstanding.
To determine if a potential impairment is more-likely-than-not, we perform a single step quantitative test with any excess of carrying value over fair value recorded as an expense in Intangible amortization and impairments. We completed our annual qualitative goodwill impairment assessment as of September 30, 2023 and no impairment was indicated.
To determine if a potential impairment is more- likely-than-not, we perform a single step quantitative test with any excess of carrying value over fair value recorded as an expense in Intangible amortization and impairments. We completed our annual qualitative goodwill impairment assessment as of September 30, 2024 and no impairment was indicated.
The junior convertible securities are considered contingent payment debt instruments under federal income tax regulations, which require us to deduct interest in an amount greater than our reported interest expense. We estimate that these deductions will generate annual deferred tax liabilities of approximately $9 million.
The junior convertible securities are considered contingent payment debt instruments under federal income tax regulations, which require us to deduct interest in an amount greater than our reported interest expense. We estimate that these deductions will generate annual deferred tax liabilities of approximately $10 million .
Reported product performance is gross-of-fees for institutional and high-net-worth separate accounts, and generally net-of-fees across retail funds and other commingled vehicles such as hedge funds. (3) Multi-asset and fixed income products are mainly our wealth management and solutions offerings.
Reported product performance is gross-of-fees for institutional and high-net-worth separate accounts, and generally net-of-fees across retail funds and other commingled vehicles such as hedge funds. (4) Multi-asset and fixed income products are mainly our wealth management and solutions offerings.
Performance and AUM information is as of December 31, 2023 and is based on data available at the time of calculation. Product returns are sourced from Affiliates while benchmark returns are generally sourced via third-party subscriptions.
Performance and AUM information is as of December 31, 2024 and is based on data available at the time of calculation. Product returns are sourced from Affiliates while benchmark returns are generally sourced via third-party subscriptions.
In these analyses, we also consider historical and current market multiples, tax benefits, credit risk, interest rates, tax rates, discount rates, volatility, and discounts for lack of marketability. We consider the reasonableness of our assumptions by comparing our valuation conclusions to observed market transactions and, in certain instances, by consulting with third-party valuation firms.
In these analyses, we also consider historical and current market multiples, tax benefits, credit risk, interest rates, tax rates, discount rates, volatility, and discounts for lack of marketability. We consider the reasonableness of our assumptions by 35 Table of Contents comparing our valuation conclusions to observed market transactions and, in certain instances, by consulting with third-party valuation firms.
In the event of a purchase, we become the owner of the cash flow associated with the purchased equity. See Notes 16 and 17 of our Consolidated Financial Statements.
In the event of a purchase, we become the owner of the cash flow associated with the purchased equity. See Notes 15 and 16 of our Consolidated Financial Statements.
We believe Economic net income (controlling interest) is an important supplemental financial performance measure because it represents our performance before non-cash expenses relating to our acquisition of interests in Affiliates and improves comparability of performance between periods.
We believe Economic net income (controlling interest) is an important supplemental financial performance measure because it represents our performance before non-cash expenses primarily related to our acquisition of interests in Affiliates and improves comparability of performance between periods.
Average assets under management for mutual funds and similar investment products generally represents an average of the daily net assets under management, while for institutional and high net worth clients, average assets under management generally represents an average of the assets at the beginning or end of each month during the applicable period.
Average assets under management for mutual funds and similar investment products generally represents an average of the daily net assets under management, while for 23 Table of Contents institutional and high net worth clients, average assets under management generally represents an average of the assets at the beginning or end of each month during the applicable period.
Our discussion and analysis of the key operating performance measures and financial results for fiscal year 2023 compared to fiscal year 2022 is included herein.
Our discussion and analysis of the key operating performance measures and financial results for fiscal year 2024 compared to fiscal year 2023 is included herein.
For discussion and analysis of fiscal year 2022 compared to fiscal year 2021, please refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 7 of Part II in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, which was filed with the SEC on February 17, 2023.
For discussion and analysis of fiscal year 2023 compared to fiscal year 2022 , please refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 7 of Part II in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 , which was filed with the SEC on February 16, 2024 .
Our Affiliates accounted for under the equity method manage a greater proportion of assets subject to performance-based fees than our consolidated Affiliates and, as a result, equity method revenue will generally have more performance-based fees than Consolidated revenue.
Our Affiliates accounted for under the equity method manage a greater 27 Table of Contents proportion of assets subject to performance-based fees than our consolidated Affiliates and, as a result, equity method revenue will generally have more performance-based fees than Consolidated revenue.
These percentages were approximately 12% and 48% of our assets under management for our consolidated Affiliates and Affiliates accounted for under the equity method, respectively.
These percentages were approximately 12% and 47% of our assets under management for our consolidated Affiliates and Affiliates accounted for under the equity method, respectively.
Performance-based fees are generally billed less frequently than asset-based fees and will vary from period to period because they inherently depend on investment performance. As of December 31, 2023, approximately 27% of our total assets under management could potentially earn performance-based fees.
Performance-based fees are generally recognized less frequently than asset-based fees and will vary from period to period because they inherently depend on investment performance. As of December 31, 2024 , approximately 27% of our total assets under management could potentially earn performance-based fees.
Executive Overview AMG is a strategic partner to leading independent investment firms globally. Our strategy is to generate long-term value by investing in a diverse array of high-quality independent partner-owned firms, referred to as “Affiliates,” through a proven partnership approach, and allocating resources across our unique opportunity set to the areas of highest growth and return.
Executive Overview AMG is a strategic partner to leading independent investment firms globally. Our strategy is to generate long-term value by investing in high-quality independent partner-owned firms, which we refer to as “Affiliates,” through a proven partnership approach, and allocating resources across our unique opportunity set to the areas of highest growth and return.
For these Affiliates, we typically use structured partnership interests in which we contractually share in the Affiliate’s revenue without regard to expenses. Consolidated revenue is generally determined by the level of our consolidated Affiliates’ average assets under management and the composition of these assets across our consolidated Affiliates’ investment strategies with different asset-based fee ratios and performance-based fees.
For these Affiliates, we typically use operating structures where we contractually share in the Affiliate’s revenue without regard to expenses. Consolidated revenue is generally determined by the level of our consolidated Affiliates’ average assets under management and the composition of these assets across our consolidated Affiliates’ investment strategies with different asset-based fee ratios and performance-based fees.
Economic net income (controlling interest) and Economic earnings per share are used by our management and Board of Directors as our principal performance benchmarks, including as one of the measures for aligning executive compensation with stockholder value.
Economic net income (controlling interest) and Economic earnings per share are used by management and our Board of Directors as our principal performance benchmarks, including as one of the measures for determining executive compensation.
For the years ended December 31, 2021, 2022, and 2023, other economic items were net of income tax expense (benefit) of $21.8 million, $(6.4) million, and $5.2 million, respectively.
For the years ended December 31, 2022 , 2023 , and 2024 , other economic items were net of income tax expense (benefit) of $(6.4) million, $5.2 million, and $4.1 million, respectively.
These items were partially offset by timing differences in the cash settlement of receivables, other assets, and payables, accrued liabilities, and other liabilities of $228.6 million. In 2023, operating cash flows were primarily attributable to the controlling interest.
These items were partially offset by timing differences in the cash settlement of receivables, other assets, and payables, accrued liabilities, and other liabilities of $56.8 million . In 2024 , operating cash flows were primarily attributable to the controlling interest.
Share Repurchases Our Board of Directors authorized share repurchase programs in January 2022, October 2022, and October 2023 to repurchase up to 2.0 million, 3.0 million, and 3.3 million shares of our common stock, respectively, and these authorizations have no expiry.
Share Repurchases Our Board of Directors authorized share repurchase programs in October 2022 , October 2023 , and July 2024 to repurchase up to 3.0 million , 3.3 million , and 5.4 million shares of our common stock, respectively, and these authorizations have no expiry.
These non-GAAP performance measures are provided in addition to, but not as substitutes for, Net income (controlling interest) and Earnings per share (diluted) or other GAAP performance measures.
These non-GAAP performance measures are provided in addition to, but not as a substitute for, Net income, Net income (controlling interest), Earnings per share, or other GAAP performance measures.
We adjust Net income (controlling interest) to calculate Economic net income (controlling interest) by adding back our share of pre-tax intangible amortization and impairments attributable to intangible assets (including the portion attributable to equity method investments in Affiliates) because these expenses do not correspond to the changes in the value of these assets, which do not diminish predictably over time.
Economic Net Income (controlling interest) and Economic Earnings Per Share Under our Economic net income (controlling interest) definition, we adjust Net income (controlling interest) for our share of pre-tax intangible amortization and impairments related to intangible assets (including the portion attributable to equity method investments in Affiliates) because these expenses do not correspond to the changes in the value of these assets, which do not diminish predictably over time.
The following table presents our key aggregate operating performance measures: 22 Table of Contents As of and for the Years Ended December 31, (in billions, except as noted) 2021 2022 % Change 2023 % Change Assets under management $ 813.8 $ 650.8 (20) % $ 672.7 3 % Average assets under management 761.7 709.4 (7) % 660.3 (7) % Aggregate fees (in millions) 5,611.4 5,560.5 (1) % 5,066.6 (9) % Assets under management, and therefore average assets under management, include the assets under management of our consolidated and equity method Affiliates.
The following table presents our key aggregate operating performance measures: As of and for the Years Ended December 31, (in billions, except as noted) 2022 2023 % Change 2024 % Change Assets under management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 650.8 $ 672.7 3 % $ 707.9 5 % Average assets under management . . . . . . . . . . . . . . . . . . . . . . . . . 709.4 660.3 (7) % 700.5 6 % Aggregate fees (in millions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,560.5 5,066.6 (9) % 5,236.0 3 % Assets under management, and therefore average assets under management, include the assets under management of our consolidated and equity method Affiliates.
See Note 6 of our Consolidated Financial Statements. 33 Table of Contents December 31, (in millions) 2021 2022 2023 Senior bank debt $ 350.0 $ 350.0 $ 350.0 Senior notes 1,098.0 1,098.7 1,099.4 Junior subordinated notes 765.8 765.9 765.9 Junior convertible securities 299.5 341.7 341.7 The carrying value of our debt differs from the amount reported in the notes to our Consolidated Financial Statements, as the carrying value of our debt in the table above is not reduced for debt issuance costs.
December 31, (in millions) 2022 2023 2024 Senior bank debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 350.0 $ 350.0 $ — Senior notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,098.7 1,099.4 1,097.4 Junior subordinated notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 765.9 765.9 1,216.0 Junior convertible securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 341.7 341.7 341.7 The carrying value of our debt differs from the amount reported in the notes to our Consolidated Financial Statements, as the carrying value of our debt in the table above is not reduced for debt issuance costs.
See Note 1 of our Consolidated Financial Statements for a discussion of our significant accounting policies. The following are our critical accounting estimates and judgments used in the preparation of our Consolidated Financial Statements, and due to their subjectivity, actual results could differ materially from the amounts reported.
The following are our critical accounting estimates and judgments used in the preparation of our Consolidated Financial Statements, and due to their subjectivity, actual results could differ materially from the amounts reported.
Recent Accounting Developments See Note 1 of our Consolidated Financial Statements. 35 Table of Contents Critical Accounting Estimates and Judgments The preparation of financial statements and related disclosures in conformity with GAAP requires us to make judgments, assumptions, and estimates that affect the amounts reported in our Consolidated Financial Statements and accompanying notes.
Critical Accounting Estimates and Judgments The preparation of financial statements and related disclosures in conformity with GAAP requires us to make judgments, assumptions, and estimates that affect the amounts reported in our Consolidated Financial Statements and accompanying notes. See Note 1 of our Consolidated Financial Statements for a discussion of our significant accounting policies.
We also add back the deferred taxes attributable to intangible assets because we believe it is unlikely these accruals will be used to settle material tax obligations. Further, we adjust for gains and losses related to the BPEA and Veritable Transactions, net of tax and other economic items to improve comparability of performance between periods.
We also adjust for deferred taxes attributable to intangible assets because we believe it is unlikely these accruals will be used to settle material tax obligations. Further, we adjust for gains and losses related to Affiliate Transactions, net of tax, and other economic items.
As of December 31, 2023, the current redemption value of Affiliate equity interests was $447.3 million, of which $393.4 million was presented as Redeemable non-controlling interests (including $11.8 million of consolidated Affiliate sponsored investment products primarily attributable to third-party investors), and $53.9 million was included in Other liabilities.
As of December 31, 2024 , the current redemption value of Affiliate equity interests was $405.3 million , of which $350.5 million was presented as Redeemable non-controlling interests (including $12.9 million of consolidated Affiliate sponsored investment products primarily attributable to third-party investors), and $54.8 million was included in Other liabilities.
Equity method earnings decreased more than equity method revenue on a percentage basis primarily due to the recognition of performance-based fees earned by Affiliates in which we hold less of an economic interest.
Equity method earnings increased more than equity method revenue on a percentage basis primarily due to an increase in earnings at certain Affiliates in which we share in revenue less agreed-upon expenses and the recognition of performance-based fees earned by Affiliates in which we hold a greater economic interest.
The portion of these lease obligations attributable to the controlling interest were $11.3 million through 2024, $13.6 million from 2025 through 2026, $3.9 million from 2027 through 2028, and $8.0 million thereafter. See Note 10 of our Consolidated Financial Statements.
The portion of these lease obligations attributable to the controlling interest were $9.3 million through 2025, $6.6 million from 2026 through 2027, $4.0 million from 2028 through 2029, and $6.4 million thereafter. See Note 9 of our Consolidated Financial Statements. Recent Accounting Developments See Note 1 of our Consolidated Financial Statements.
We consider the reasonableness of our assumptions by comparing our valuation conclusions to observed market transactions, comparable company valuations, and, in certain instances, by consulting with third-party valuation firms. Changes in these assumptions could significantly impact the respective fair value of an Affiliate.
We consider the reasonableness of our assumptions by comparing our valuation conclusions to observed market transactions, comparable company valuations, and, in certain instances, by consulting with third-party valuation firms.
The following table presents our consolidated Affiliates’ average assets under management and Consolidated revenue: For the Years Ended December 31, (in millions, except as noted) 2021 2022 % Change 2023 % Change Consolidated Affiliate average assets under management (in billions) $ 445.8 $ 422.2 (5) % $ 393.7 (7) % Consolidated revenue $ 2,412.4 $ 2,329.6 (3) % $ 2,057.8 (12) % Our Consolidated revenue decreased $271.8 million or 12% in 2023, due to a $165.5 million or 7% decrease from asset-based fees and a $106.3 million or 5% decrease from performance-based fees, primarily in our private markets strategies.
The following table presents our consolidated Affiliates’ average assets under management and Consolidated revenue: For the Years Ended December 31, (in millions, except as noted) 2022 2023 % Change 2024 % Change Consolidated Affiliate average assets under management (in billions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 422.2 $ 393.7 (7) % $ 399.3 1 % Consolidated revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,329.6 $ 2,057.8 (12) % $ 2,040.9 (1) % Our Consolidated revenue decreased $16.9 million or 1% in 2024 , primarily due to a $20.3 million or 1% decrease from asset-based fees.
We perform these assessments if certain triggering events occur or annually during the fourth quarter. We first consider whether certain qualitative and quantitative factors (including discount rates) indicate an increased likelihood of a decline in the fair value of an Affiliate during the reporting period.
We first consider whether certain qualitative and quantitative factors (including discount rates) indicate an increased likelihood of a decline in the fair value of an Affiliate during the reporting period.
Adjusted EBITDA (controlling interest) Adjusted EBITDA (controlling interest) is an important supplemental financial performance measure for management as it provides a comprehensive view of our share of the financial performance of our business before interest expense, income and certain non-income based taxes, depreciation, amortization, impairments, gains and losses related to the BPEA and Veritable Transactions, and non-cash items such as certain Affiliate equity activity, gains and losses on our contingent payment obligations, and unrealized gains and losses on seed capital, general partner commitments, and other strategic investments.
Adjusted EBITDA (controlling interest) Adjusted EBITDA (controlling interest) represents our performance before our share of interest expense, income and certain non-income based taxes, depreciation, amortization, impairments, gains and losses related to Affiliate Transactions, and non-cash items such as certain Affiliate equity activity, gains and losses on our contingent payment obligations, and unrealized gains and losses on seed capital, general partner commitments, and other strategic investments.
This equity distribution program superseded and replaced our prior equity distribution program. As of December 31, 2023, no sales had occurred under the equity distribution program. Commitments See Note 7 of our Consolidated Financial Statements. Other Contingent Commitments See Notes 4 and 7 of our Consolidated Financial Statements.
As of December 31, 2024 , no sales had occurred under the equity distribution program. Commitments See Note 6 of our Consolidated Financial Statements. Other Contingent Commitments See Notes 3 and 6 of our Consolidated Financial Statements.
The following tables present performance of our investment strategies, where available, measured by the percentage of assets under management ahead of their relevant benchmark: AUM Weight % of AUM Ahead of Benchmark (1) 3-year 5-year 10-year Liquid alternatives (2) 18 % 85 % 95 % 84 % Global equity (2) 28 % 44 % 43 % 61 % U.S. equity (2) 21 % 42 % 77 % 77 % Multi-asset and fixed income (3) 16 % N/A N/A N/A AUM Weight % of AUM Ahead of Benchmark (1) IRR Latest Vintage IRR Last Three Vintages Private markets (4) 17 % 83 % 84 % ___________________________ (1) Past performance is not indicative of future results.
The following tables present performance of our investment strategies, where available, measured by the percentage of assets under management ahead of their relevant benchmark: AUM Weight % of AUM Ahead of Benchmark (1) IRR Latest Vintage IRR Last Three Vintages Private markets (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19% 85% 84% AUM Weight % of AUM Ahead of Benchmark (1) 3-year 5-year 10-year Liquid alternatives (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20% 87% 95% 87% Equities (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45% 36% 53% 53% Multi-asset and fixed income (4) . . . . . . . . . . . . . . . . . . . . . . . . 16% N/A N/A N/A 24 Table of Contents ___________________________ (1) Past performance is not indicative of future results.
Although the timing and amounts of these purchases are difficult to predict, we paid $67.4 million for Affiliate equity purchases and received $13.4 million for Affiliate equity issuances in 2023, and we expect net purchases of approximately $100 million of Affiliate equity in 2024.
Although the timing and amounts of these purchases are difficult to predict, we paid $106.5 million for Affiliate equity purchases and received $6.3 million for Affiliate equity issuances in 2024 , and we expect net purchases of approximately $175 million of Affiliate equity in 2025 .
Benchmarks utilized include a combination of public market equivalents, peer medians, and absolute returns where benchmarks are not available. For purposes of investment performance comparisons, the latest vintage comparison includes the most recent vehicles and strategies (traditional long-duration investment funds, customized vehicles, and other evergreen vehicles and product structures) where meaningful performance is available and calculable.
For purposes of investment performance comparisons, the latest vintage comparison includes the most recent vehicles and strategies (traditional long-duration investment funds, customized vehicles, and other evergreen vehicles and product structures) where meaningful performance is available and calculable.
Whether we consolidate an Affiliate or use the equity method of accounting, we maintain the same innovative partnership approach and provide support and assistance in substantially the same manner for all of our Affiliates. Furthermore, all of our Affiliates are investment managers and are impacted by similar marketplace factors and industry trends.
(“GAAP”), we are required to consolidate certain of our Affiliates and use the equity method of accounting for others. Whether we consolidate an Affiliate or use the equity method of accounting, we maintain the same innovative partnership approach and provide support and assistance in substantially the same manner for all of our Affiliates.
Aggregate fees are provided in addition to, but not as a substitute for, Consolidated revenue or other GAAP performance measures. Assets Under Management Our Affiliates provide a diverse range of differentiated return streams through their specialized investment processes.
Aggregate fees are provided in addition to, but not as a substitute for, Consolidated revenue or other GAAP performance measures. Assets Under Management Our Affiliates manage capital on behalf of clients across a diverse range of investment strategies.
Therefore, our key aggregate operating performance measures are important in providing management with a more comprehensive view of the operating performance and material trends across our entire business.
Furthermore, all of our Affiliates are investment managers and are impacted by similar marketplace factors and industry trends . Therefore, certain key aggregate operating performance measures are important in providing management with a comprehensive view of the operating performance and material trends across our entire business.
(2) Adjusted EBITDA (controlling interest) and Economic net income (controlling interest) are non-GAAP performance measures and are discussed in “Supplemental Financial Performance Measures.” Adjusted EBITDA (controlling interest) is an important supplemental financial performance measure for management as it provides a comprehensive view of our share of the financial performance of our business.
Adjusted EBITDA (controlling interest) is an important supplemental financial performance measure for management as it provides a comprehensive view of our share of the financial performance of our business.
Equity Method Income (Net) When we do not own a controlling equity interest in an Affiliate, but have significant influence, we account for our interest in the Affiliate under the equity method. Our share of earnings or losses from Affiliates accounted for under the equity method, net of amortization and impairments, is included in Equity method income (net).
Equity Method Income (Net) When we do not own a controlling equity interest in an Affiliate, but have significant influence, we account for our interest in the Affiliate under the equity method.
The following table presents the Intangible amortization and impairments shown above: For the Years Ended December 31, (in millions) 2021 2022 2023 Consolidated intangible amortization and impairments $ 35.7 $ 51.6 $ 48.3 Consolidated intangible amortization and impairments (non-controlling interests) (10.8) (15.7) (15.4) Equity method intangible amortization and impairments 175.0 159.1 95.6 Total $ 199.9 $ 195.0 $ 128.5 (2) The year ended December 31, 2022 includes BPEA Transaction gain of $641.9 million and realized and unrealized gains on EQT ordinary shares of $43.8 million and $57.9 million, respectively.
(15.7) (15.4) (9.8) Equity method intangible amortization and impairments . . . . . . . . . . . . . . . . . . . . . . . 159.1 95.6 130.0 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 195.0 $ 128.5 $ 149.2 (2) The year ended December 31, 2022 includes BPEA Transaction gain of $641.9 million and realized and unrealized gains on EQT ordinary shares of $43.8 million and $57.9 million , respectively.
The year ended December 31, 2023 includes Veritable Transaction gain of $133.1 million and realized gains on ordinary shares of EQT of $29.6 million. 30 Table of Contents (3) Other items include certain non-income based taxes, depreciation, and non-cash items such as gains and losses on our contingent payment obligations, certain Affiliate equity activity, unrealized gains and losses on seed capital, general partner commitments, and other strategic investments, and realized economic gains and losses related to these seed capital, general partner commitments, and other strategic investments.
(3) Other items include certain non-income based taxes, depreciation, and non-cash items such as certain Affiliate equity activity, gains and losses on our contingent payment obligations, unrealized gains and losses on seed capital, general partner commitments, and other strategic investments, and realized economic gains and losses related to these seed capital, general partner commitments, and other strategic investments.
Investment and Other Income The following table presents our Investment and other income: For the Years Ended December 31, (in millions) 2021 2022 % Change 2023 % Change Investment and other income $ 117.6 $ 110.3 (6) % $ 117.1 6 % Investment and other income increased $6.8 million or 6% in 2023, primarily due to a $29.2 million net increase in realized and unrealized gains on Other investments and a $21.1 million increase in interest income.
Investment and Other Income The following table presents our Investment and other income: For the Years Ended December 31, (in millions) 2022 2023 % Change 2024 % Change Investment and other income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 110.3 $ 117.1 6 % $ 77.4 (34) % 28 Table of Contents Investment and other income decreased $39.7 million or 34% in 2024 , primarily due to a $35.3 million decrease in net realized and unrealized gains on investments in marketable securities.
For the year ended December 31, 2023, Cash flows from operating activities were $874.3 million, primarily from Net income of $906.1 million adjusted for $490.8 million of distributions of earnings received from equity method investments and non-cash items of $303.3 million.
For the year ended December 31, 2024 , Cash flows from operating activities were $932.1 million , primarily from Net income of $740.6 million and distributions of earnings received from equity method investments of $403.9 million .
We also use structured partnership interests in which we contractually share in the Affiliate’s revenue without regard to expenses. Our equity method revenue is derived primarily from asset- and performance-based fees from investment management services.
For a majority of these Affiliates, we use operating structures where we contractually share in the Affiliate’s revenue less agreed-upon expenses. We also use operating structures where we contractually share in the Affiliate’s revenue without regard to expenses. Our equity method revenue is derived primarily from asset- and performance-based fees from investment management services earned by our equity method Affiliates.
Aggregate fees were $5,066.6 million in 2023, a decrease of $493.9 million or 9% as compared to 2022. The decrease in our aggregate fees was due to a $348.7 million or 6% decrease from asset-based fees and a $145.2 million or 3% decrease from performance-based fees, primarily in our liquid alternative strategies.
Aggregate fees were $5,236.0 million in 2024 , an increase of $169.4 million or 3% as compared to 2023 . The increase in our aggregate fees was due to a $323.1 million or 6% increase from asset-based fees, offset by a $153.7 million or 3% decrease from performance-based fees, primarily in our liquid alternative strategies.
As of December 31, 2023, we had repurchased all of the shares in the repurchase program authorized in January 2022, and there were a total of 4.2 million shares available for repurchase under our share repurchase programs.
As of December 31, 2024 , we had repurchased all of the shares in the repurchase program authorized in October 2023, and there were a total of 5.3 million shares available for repurchase under our July 2024 share repurchase program. Debt The following table presents the carrying value of our outstanding indebtedness.
Equity method intangible amortization decreased $23.1 million or 21% in 2023, primarily due to a $22.9 million decrease in amortization expense due to a decrease in actual and expected client attrition for certain definite-lived acquired client relationships and an $8.4 million decrease due to the BPEA Transaction.
Equity method intangible amortization increased $4.1 million or 5% in 2024 , primarily due to a $19.5 million increase in amortization expense due to investments in new Affiliates and a $17.9 million increase in amortization expense due to a decrease in actual and expected client attrition for certain definite-lived acquired client relationships.
The following table presents our Consolidated expenses: For the Years Ended December 31, (in millions) 2021 2022 % Change 2023 % Change Compensation and related expenses $ 1,047.1 $ 1,071.5 2 % $ 907.5 (15) % Selling, general and administrative 347.1 385.5 11 % 358.2 (7) % Intangible amortization and impairments 35.7 51.6 45 % 48.3 (6) % Interest expense 111.4 114.4 3 % 123.8 8 % Depreciation and other amortization 16.6 15.8 (5) % 13.0 (18) % Other expenses (net) 73.5 34.7 (53) % 45.8 32 % Total consolidated expenses $ 1,631.4 $ 1,673.5 3 % $ 1,496.6 (11) % Compensation and related expenses decreased $164.0 million or 15% in 2023, primarily due to a $161.9 million decrease in compensation correlated to the decrease in Consolidated revenue and a $3.0 million decrease in share-based compensation. 27 Table of Contents Selling, general and administrative expenses decreased $27.3 million or 7% in 2023, primarily due to a $26.0 million decrease in distribution and investment-related expenses principally as a result of a decrease in average assets under management on which these expenses are incurred.
Consolidated Expenses The following table presents our Consolidated expenses: For the Years Ended December 31, (in millions) 2022 2023 % Change 2024 % Change Compensation and related expenses . . . . . . . . . . . . . . . . . . . . . . . . $ 1,071.5 $ 907.5 (15) % $ 915.3 1 % Selling, general and administrative . . . . . . . . . . . . . . . . . . . . . . . . 385.5 358.2 (7) % 376.5 5 % Intangible amortization and impairments . . . . . . . . . . . . . . . . . . . . 51.6 48.3 (6) % 29.0 (40) % Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114.4 123.8 8 % 133.3 8 % Depreciation and other amortization . . . . . . . . . . . . . . . . . . . . . . . 15.8 13.0 (18) % 13.4 3 % Other expenses (net) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34.7 45.8 32 % 40.3 (12) % Total consolidated expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,673.5 $ 1,496.6 (11) % $ 1,507.8 1 % Compensation and related expenses increased $7.8 million or 1% in 2024 , primarily due to a $16.3 million increase in compensation accruals and a $6.9 million increase in Affiliate equity compensation expense.
In the fourth quarter of 2022, we completed the sale of our equity interest in Baring Private Equity Asia (“BPEA”) to EQT AB (“EQT”), a public company listed on Nasdaq Stockholm (EQT.ST), (the “BPEA Transaction”) in connection with the strategic combination of BPEA and EQT.
Affiliate Transaction Gains For the years ended December 31, 2022 and 2023 , we recorded gains of $641.9 million on the sale of our equity interest in Baring Private Equity Asia ("BPEA") to EQT AB ("EQT"), a public company listed on the Nasdaq Stockholm (EQT.ST) (the "BPEA Transaction"), in connection with the strategic combination of BPEA and EQT, which was completed in the fourth quarter of 2022, and $133.1 million on the Veritable Transaction, respectively.
Leases As of December 31, 2023, our lease obligations were $40.0 million through 2024, $61.5 million from 2025 through 2026, $43.9 million from 2027 through 2028, and $68.3 million thereafter.
Leases As of December 31, 2024 , our lease obligations were $35.1 million through 2025 , $51.7 million from 2026 through 2027, $44.1 million from 2028 through 2029, and $47.3 million thereafter.
The decrease in asset-based fees was principally due to a decrease in our average assets under management, primarily in our global equity strategies, and the impact of the BPEA Transaction. These decreases were partially offset by changes in the composition of our assets under management.
The decrease in asset-based fees was principally due to changes in the composition of our assets under 26 Table of Contents management, including the impact of the Veritable Transaction, partially offset by an increase in our consolidated Affiliate average assets under management, primarily in our private markets strategies.
For the year ended December 31, 2023, we completed our annual assessment and only a significant decline in the fair values of these assets would result in an impairment. 36 Table of Contents Equity Method Investments in Affiliates We periodically perform assessments to determine if the fair value of an investment may have declined below its related carrying value for our Affiliates accounted for under the equity method for a period that we consider to be other-than-temporary.
Equity Method Investments in Affiliates We periodically perform assessments to determine if the fair value of an investment may have declined below its related carrying value for our Affiliates accounted for under the equity method for a period that we consider to be other-than- temporary. We perform these assessments if certain triggering events occur or annually during the fourth quarter.
(2) For liquid alternative, global equity, and U.S. equity products, performance is reported as the percentage of assets that have outperformed benchmarks across the indicated periods, and excludes market-hedging products.
Due to the nature of these investments and vehicles, reported performance is typically on a three- to six-month lag basis. (3) For liquid alternative and equity products, performance is reported as the percentage of assets that have outperformed benchmarks across the indicated periods, and excludes market-hedging products.
Cash and cash equivalents were $813.6 million as of December 31, 2023 and were attributable to both our controlling and the non-controlling interests. Our principal uses of cash in 2023 were for investments in new Affiliates, purchases of investment securities, distributions to Affiliate equity holders, and the return of excess capital through share repurchases.
Our principal uses of cash in 2024 were for the return of excess capital through share repurchases, repayment of debt, purchases of investment securities, and distributions to Affiliate equity holders .
The following table presents operating, investing, and financing cash flow activities: For the Years Ended December 31, (in millions) 2021 2022 2023 Operating cash flow $ 1,259.2 $ 1,054.7 $ 874.3 Investing cash flow (583.7) (109.9) 264.5 Financing cash flow (798.3) (1,402.9) (758.3) Operating Cash Flow Operating cash flows are calculated by adjusting Net income for other significant sources and uses of cash, significant non-cash items, and timing differences in the cash settlement of assets and liabilities.
(1,402.9) (758.3) (1,175.9) Operating Cash Flow Operating cash flows are calculated by adjusting Net income for other significant sources and uses of cash, significant non- cash items, and timing differences in the cash settlement of assets and liabilities.
Economic net income (controlling interest) decreased $79.4 million or 10% in 2023 primarily due to a $118.1 million or 11% decrease in Adjusted EBITDA (controlling interest). Results of Operations The following discussion includes the key operating performance measures and financial results of our consolidated and equity method Affiliates.
These decreases were partially offset by a $37.4 million or 4% increase in Adjusted EBITDA (controlling interest). Results of Operations The following discussion includes the key operating performance measures and financial results of our consolidated and equity method Affiliates.
The trust’s only assets are junior subordinated convertible debentures issued to it by us, and have substantially the same payment terms as the junior convertible securities. We own all of the trust’s common securities, and have fully and unconditionally guaranteed, on a subordinated basis, the payment obligations on the junior convertible securities.
Each of the junior convertible securities represents an undivided beneficial interest in the assets of the trust. The trust’s only assets are junior subordinated convertible debentures issued to it by us, and have substantially the same payment terms as the junior convertible securities.
We continue to see demand for alternative strategies, as evidenced by our net inflows in this category for the year ended December 31, 2023. At the same time, our equity strategies saw outflows, particularly in global equities, in line with client cash flow trends across the industry.
We continue to see client demand for alternative strategies (both in private markets and liquid alternatives), as evidenced by our net inflows in this category, but our equity strategies experienced net outflows in line with trends across the industry.
Financing Cash Flow For the year ended December 31, 2023, Cash flows used in financing activities were $758.3 million, primarily due to $341.9 million of repurchases of common stock (net), $271.3 million of distributions to non-controlling interests, $55.3 million of other financing items, and $54.0 million of Affiliate equity purchases, net of issuances.
Financing Cash Flow For the year ended December 31, 2024 , Cash flows used in financing activities were $1,175.9 million , primarily due to $709.8 million of repurchases of common stock, net, repayment of senior notes and senior bank debt of $400.0 million and $350.0 million, respectively, $258.0 million of distributions to non-controlling interests, $100.2 million of Affiliate equity purchases, net of issuances, and $98.7 million of deferred payments.
In addition, we may draw funding from the debt and equity capital markets, and our credit ratings, among other factors, allow us to access these sources of funding on favorable terms.
In addition, we may draw funding from the debt and equity capital markets, and our credit ratings, among other factors, allow us to access these sources of funding on favorable terms. 31 Table of Contents The following table presents operating, investing, and financing cash flow activities: For the Years Ended December 31, (in millions) 2022 2023 2024 Operating cash flow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,054.7 $ 874.3 $ 932.1 Investing cash flow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Supplemental Financial Performance Measures 29 Table of Contents As supplemental information, we provide non-GAAP performance measures of Adjusted EBITDA (controlling interest), Economic net income (controlling interest), and Economic earnings per share. Management utilizes these non-GAAP performance measures to assess our performance before our share of certain non-cash expenses and to improve comparability between periods.
Supplemental Financial Performance Measures As supplemental information to our GAAP performance measures, including Net income (see Note 21 of our Consolidated Financial Statements), we provide non-GAAP performance measures of Adjusted EBITDA (controlling interest), Economic net income (controlling interest), and Economic earnings per share.
The first of these covenants is a maximum ratio of debt to EBITDA (the “bank leverage ratio”) of 3.25x. The second covenant is a minimum EBITDA to cash interest expense ratio of 3.00x (the “bank interest coverage ratio”). For purposes of calculating these ratios, share-based compensation and certain Affiliate equity expenses are added back to Adjusted EBITDA.
Under the terms of the revolver we are required to meet two financial ratio covenants. The first of these covenants is a maximum ratio of debt to EBITDA (the “bank leverage ratio”) of 3.25x. The second covenant is a minimum EBITDA to cash interest expense ratio of 3.00x (the “bank interest coverage ratio”).
The following table presents equity method Affiliate average assets under management and equity method revenue, as well as equity method earnings, equity method intangible amortization, and equity method intangible impairments, which in aggregate form Equity method income (net): For the Years Ended December 31, (in millions, except as noted) 2021 2022 % Change 2023 % Change Operating Performance Measures Equity method Affiliate average assets under management (in billions) $ 315.9 $ 287.2 (9) % $ 266.6 (7) % Equity method revenue $ 3,199.0 $ 3,230.9 1 % $ 3,008.8 (7) % Financial Performance Measures Equity method earnings $ 417.5 $ 497.2 19 % $ 375.6 (24) % Equity method intangible amortization (123.0) (109.1) (11) % (86.0) (21) % Equity method intangible impairments (52.0) (50.0) (4) % (9.6) (81) % Equity method income (net) $ 242.5 $ 338.1 39 % $ 280.0 (17) % Our equity method revenue decreased $222.1 million or 7% in 2023, due to a $183.2 million or 6% decrease from asset-based fees and a $38.9 million or 1% decrease from performance-based fees, primarily in our liquid alternative strategies.
The following table presents equity method Affiliate average assets under management and equity method Affiliate revenue (“equity method revenue”), as well as equity method earnings, equity method intangible amortization, and equity method intangible impairments, if any, which in aggregate form Equity method income (net): For the Years Ended December 31, (in millions, except as noted) 2022 2023 % Change 2024 % Change Operating Performance Measures Equity method Affiliate average assets under management (in billions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 287.2 $ 266.6 (7) % $ 301.2 13 % Equity method revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,230.9 $ 3,008.8 (7) % $ 3,195.1 6 % Financial Performance Measures Equity method earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 497.2 $ 375.6 (24) % $ 442.7 18 % Equity method intangible amortization . . . . . . . . . . . . . . . . . . . . .
The following table presents a reconciliation of Net income (controlling interest) to Economic net income (controlling interest) and Economic earnings per share: For the Years Ended December 31, (in millions, except per share data) 2021 2022 2023 Net income (controlling interest) $ 565.7 $ 1,145.9 $ 672.9 Intangible amortization and impairments (1) 199.9 195.0 128.5 Intangible-related deferred taxes (2) 52.5 45.5 57.3 Affiliate Transactions (3) — (576.0) (122.1) Other economic items (4) (48.1) (13.2) (18.8) Economic net income (controlling interest) $ 770.0 $ 797.2 $ 717.8 Average shares outstanding (diluted) 44.8 49.0 42.2 Hypothetical issuance of shares to settle Redeemable non-controlling interests — (7.4) (3.7) Assumed issuance of junior convertible securities shares (2.1) (1.8) (1.7) Average shares outstanding (adjusted diluted) 42.7 39.8 36.8 Economic earnings per share $ 18.05 $ 20.02 $ 19.48 ___________________________ (1) See note (1) to the table in “Adjusted EBITDA (controlling interest).” 31 Table of Contents (2) For the years ended December 31, 2022, and 2023, intangible-related deferred taxes have been adjusted to eliminate benefits of $13.5 million related to the BPEA Transaction and $28.9 million related to the Veritable Transaction, respectively.
(1.8) (1.7) (1.7) Average shares outstanding (adjusted diluted) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39.8 36.8 32.8 Economic earnings per share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 20.02 $ 19.48 $ 21.36 ___________________________ (1) See note (1) to the table in “Adjusted EBITDA (controlling interest).” (2) For the years ended December 31, 2022, and 2023, intangible-related deferred taxes have been adjusted to eliminate benefits of $13.5 million related to the BPEA Transaction and $28.9 million related to the Veritable Transaction, respectively.
As of December 31, 2023, our aggregate assets under management were approximately $673 billion across a diverse range of private markets, liquid alternatives, and differentiated long-only investment strategies.
As of December 31, 2024 , our aggregate assets under management were approximately $708 billion across a diverse range of private markets, liquid alternatives, and differentiated long-only investment strategies. On February 6, 2025, we announced the completion of our minority investment in NorthBridge Partners, LLC (“NorthBridge”), a private markets manager specializing in industrial logistics real estate assets .
Other expenses (net) increased $11.1 million or 32% in 2023, primarily due to a $13.0 million increase in expenses related to changes in the values of contingent payment obligations.
Other expenses (net) decreased $5.5 million or 12% in 2024 , primarily due to a $2.7 million decrease in expenses related to changes in the values of contingent payment obligations and a $1.5 million decrease in rent and related office costs.
As of December 31, 2023, our bank leverage and bank interest coverage ratios were 1.3x and 8.3x, respectively, and we were in compliance with all of the terms of our credit facilities. As of December 31, 2023, we had no outstanding borrowings under the revolver and could borrow all capacity and remain in compliance with our credit facilities.
As of December 31, 2024 , we had no outstanding borrowings under the revolver, and could borrow all capacity and remain in compliance with all of the terms of the revolver . Senior Notes In the first quarter of 2024, our $400.0 million 2024 senior notes matured and were fully repaid.
Investing Cash Flow 32 Table of Contents For the year ended December 31, 2023, Cash flows from investing activities were $264.5 million, primarily due to $294.0 million of cash proceeds from the Veritable Transaction and $277.4 million of net maturities and sales of investment securities. These items were partially offset by $294.7 million of investments in Affiliates.
Investing Cash Flow For the year ended December 31, 2024 , Cash flows from investing activities were $379.1 million , primarily due to $898.1 million of maturities and sales of investment securities, partially offset by $510.4 million of purchases of investment securities. In 2024 , investing cash flows were primarily attributable to the controlling interest.
See Note 19 of our Consolidated Financial Statements.
See Notes 7 and 8 of our Consolidated Financial Statements.
For the year ended December 31, 2023, we repurchased 3.0 million shares of our common stock at an average price per share of $132.99.
For the year ended December 31, 2024 , we 32 Table of Contents repurchased 4.3 million shares of our common stock at an average price per share of $162.65 . As of March 31, 2024, we had repurchased all of the shares in the repurchase program authorized in October 2022.
We do not consolidate the trust’s financial results into our Consolidated Financial Statements. Holders of the junior convertible securities have no rights to put these securities to us. Upon conversion, holders will receive cash or shares of our common stock, or a combination thereof, at our election.
We own all of the trust’s common securities, and have fully and unconditionally guaranteed, on a subordinated basis, the payment obligations on the junior convertible securities. We do not consolidate the trust’s financial results into our Consolidated Financial Statements. 34 Table of Contents Holders of the junior convertible securities have no rights to put these securities to us.
The decrease in asset-based fees was principally due to a decrease in consolidated Affiliate average assets under management, primarily in our global equity strategies. Consolidated Expenses Our Consolidated expenses are primarily attributable to the non-controlling interests of our consolidated Affiliates.
The increase in asset-based fees was principally due to an increase in our equity method Affiliate average assets under management, primarily in our liquid alternative and private markets strategies, and changes in the composition of our assets under management primarily driven by investments in new Affiliates.
For certain of our Affiliates accounted for under the equity method, we report the Affiliate’s financial results in our Consolidated Financial Statements one quarter in arrears. For a majority of these Affiliates, we use structured partnership interests in which we contractually share in the Affiliate’s revenue less agreed-upon expenses.
Our share of earnings or losses from Affiliates accounted for under the equity method (“equity method earnings”), net of amortization and impairments, is included in Equity method income (net). For certain of our Affiliates accounted for under the equity method, we report the Affiliate’s financial results in our Consolidated Financial Statements one quarter in arrears.
We believe the inclusion of net shares under a treasury stock method best reflects the benefit of the increase in available capital resources (which could be used to repurchase shares of common stock) that occurs when these securities are converted and we are relieved of our debt obligation.
We believe the inclusion of net shares under a treasury stock method best reflects the benefit of the increase in available capital resources (which could be used to repurchase shares of common stock) that occurs when these securities are converted and we are relieved of our debt obligation. 30 Table of Contents The following table presents a reconciliation of Net income (controlling interest) to Economic net income (controlling interest) and Economic earnings per share: For the Years Ended December 31, (in millions, except per share data) 2022 2023 2024 Net income (controlling interest) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,145.9 $ 672.9 $ 511.6 Intangible amortization and impairments (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195.0 128.5 149.2 Intangible-related deferred taxes (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45.5 57.3 61.9 Affiliate Transactions (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

7 edited+0 added−1 removed7 unchanged
Biggest changeWe estimate that a 1% change in interest rates would have changed our annual interest expense on the outstanding balances under our credit facilities by $3.5 million, as of December 31, 2023. Foreign Currency Risk The functional currency of most of our Affiliates is the U.S. dollar.
Biggest changeAs of December 31, 2024 , we had no outstanding borrowings under the revolver . Foreign Currency Risk The functional currency of most of our Affiliates is the U.S. dollar.
There can be no assurance that our or our Affiliates’ derivative financial instruments will meet their overall objective or that we or our Affiliates will be successful in entering into such instruments in the future. 38 Table of Contents
There can be no assurance that our or our Affiliates’ derivative financial instruments will meet their overall objective or that we or our Affiliates will be successful in entering into such instruments in the future. 37 Table of Contents
For the year ended December 31, 2023, we estimate a 1% change in the pound 37 Table of Contents sterling, Canadian dollar, and the Euro to U.S. dollar exchange rates would have resulted in $1.2 million, $0.3 million, and $0.0 million in annual changes to Income before income taxes (controlling interest), respectively.
For the year ended December 31, 2024 , we estimate a 1% change in the pound sterling, Canadian dollar, and the Euro to U.S. dollar exchange rates would have resulted in $1.2 million , $0.3 million , and $0.0 million in annual changes to Income before income taxes (controlling interest), respectively.
We pay a variable rate of interest on our credit facilities at specified rates, based either on an applicable term Secured Overnight Financing Rate (“SOFR”) plus a SOFR adjustment of 0.10% or prime rate, plus a marginal rate determined based on our credit rating.
We pay a variable rate of interest on any outstanding obligations under our revolver at specified rates, based either on an applicable term Secured Overnight Financing Rate (“SOFR”) plus a SOFR adjustment of 0.10% or prime rate, plus a marginal rate determined based on our credit rating.
We estimate that a 1% change in interest rates would have resulted in a $145.7 million net change in the fair value of our fixed rate securities as of December 31, 2023.
We estimate that a 1% change in interest rates would have resulted in a $226.1 million net change in the fair value of our fixed rate securities as of December 31, 2024 .
As of December 31, 2023, we estimate a proportional 1% change in the value of our assets under management would have resulted in a $16.3 million annualized change in asset-based fees in Consolidated revenue for our consolidated Affiliates and a $14.8 million annualized change in asset-based fees in equity method revenue for our Affiliates accounted for under the equity method.
As of December 31, 2024 , we estimate a proportional 1% change in the value of our assets under management would have resulted in a $15.9 million annualized change in asset-based fees in Consolidated revenue for our consolidated Affiliates and a $15.9 million annualized change in asset-based fees in equity method revenue for our Affiliates accounted for under the equity method.
To illustrate the effect of possible changes in foreign currency exchange rates, we estimate a 1% change in the pound sterling, Canadian dollar, and Euro to U.S. dollar exchange rates would have resulted in a $8.0 million, $2.1 million, and $1.2 million change to stockholders’ equity, respectively, based on the December 31, 2023 carrying value of Affiliates whose functional currency is the pound sterling, Canadian dollar, or the Euro, and of our and our Affiliates’ pound sterling- and Euro-denominated derivative financial instruments.
To illustrate the effect of possible changes in foreign currency exchange rates, we estimate a 1% change in the pound sterling, Canadian dollar, and Euro to U.S. dollar exchange rates would have resulted in an $8.4 million , $1.9 million , and $1.5 million change to stockholders’ equity, respectively, primarily based on the December 31, 2024 carrying value of Affiliates whose functional currency is the pound sterling, Canadian dollar, or the Euro.
Removed
As of December 31, 2023, the interest rate for our outstanding borrowings under the term loan was term-SOFR plus a SOFR adjustment of 0.10%, plus the marginal rate of 0.85%.

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