Vanguard Group named BlackRock veteran Salim Ramji as its next CEO, succeeding Tim Buckley and becoming the first outsider to lead the firm famed for revolutionizing investing with the index fund.
Ramji, who oversaw exchange-traded funds and index investing at BlackRock, will join Vanguard, one of its biggest rivals, in July, according to an emailed statement Tuesday. Vanguard was founded almost a half-century ago by the late Jack Bogle, and it managed about $9.3 trillion at the end of March.
"The current investor landscape is changing, and that presents opportunities for Vanguard to further its mission of giving people the best chance for investment success, which is more relevant today than at any time in the firm's five-decade history," Ramji said in the statement. "My focus will be to mobilize Vanguard to meet the moment while staying true to that core purpose — remaining the trusted firm that takes a stand for all investors."
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In February, Vanguard announced that Buckley planned to retire by the end of this year and that its board had begun a search for his successor. A three-decade Vanguard veteran, he has held the top job since 2018.
Ramji worked at New York-based BlackRock, the world's biggest asset manager, for about a decade and was considered one of several potential successors to CEO Larry Fink before departing in January. As global head of iShares and index investments, he helped oversee a massive expansion of the firm's ETF business which now manages about $3.7 trillion.
"We congratulate Salim on this accomplishment and thank him for his leadership at our firm," Ed Sweeney, a spokesperson for BlackRock, said in an emailed statement. "BlackRock is proud to have a track record of our firm's alumni going on to lead multiple investment management companies and financial institutions."
BlackRock, with $10.5 trillion of assets, competes directly with Vanguard in the rapidly growing ETF business, and they rank first and second in US funds, respectively. Those firms and State Street Global Advisors comprise the "Big Three" of index investing, holding massive stakes in almost all companies in the S&P 500. This has given them considerable influence over markets — and invited scrutiny from politicians and regulators wary of how the asset managers exercise their power.
Bogle's reign
Bogle, who was CEO from Vanguard's founding in 1975 through 1995, seized on the concept that a fund indexed to the broad stock market could be successful, cheap and marketed to the masses. Once the index fund took hold, it eventually led to plunging fees for many asset managers, transforming modern investing. He
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From its base outside Philadelphia, more than 100 miles from Wall Street, Vanguard has revolutionized investing not only by promoting the index fund but also by intentionally keeping a lid on fees. The firm is owned by its member funds, which are owned in turn by fund shareholders, rather than outside investors.
In recent years, Vanguard has tried expanding beyond its traditional core of index funds, including into financial advisory businesses to cultivate new clients and become a sort of Engine No. 2 for growth. The firm also continues to offer some actively managed funds but has made limited inroads into the fast-growing markets for private assets such as private equity.
On the international front, Vanguard has aimed to carry its low-cost mission of investing to new countries, offering index funds and ETFs. But in some areas it has pulled back, notably from its business in China.
