Ted Pick
MORGAN STANLEYAbout Ted Pick
Ted Pick is Chairman and Chief Executive Officer of Morgan Stanley; he became CEO on January 1, 2024 and was elected Chairman effective January 1, 2025 . He joined Morgan Stanley in 1990, rose through Sales & Trading, Equities and Capital Markets leadership, and served as Co‑President and Head of Institutional Securities prior to becoming CEO . Education: Middlebury College (Phi Beta Kappa) and Harvard Business School MBA . Under his first year of leadership (2024), the Firm delivered record net revenues of $61.8B, net income of ~$13.4B, EPS $7.95, ROTCE 18.8%, CET1 15.9%, and 1‑year TSR of 40%, with market cap surpassing $200B .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Morgan Stanley | Chairman of the Board | Jan 2025–present | Combined Chair/CEO role to present unified strategy; supported by robust Lead Independent Director oversight . |
| Morgan Stanley | Chief Executive Officer | Jan 2024–present | Led “Integrated Firm” execution; record financials and ROTCE progress in 2024 . |
| Morgan Stanley | Co‑President; Co‑Head Corporate Strategy | Jun 2021–Dec 2023 | Leadership continuity through CEO transition; firmwide strategy stewardship . |
| Morgan Stanley | Head of Institutional Securities | Jul 2018–Dec 2023 | Grew wallet share and segment revenues; risk discipline . |
| Morgan Stanley | Global Head of Sales & Trading | Oct 2015–Jul 2018 | Engineered Fixed Income turnaround, strengthened trading platform . |
| Morgan Stanley | Head / Co‑Head of Global Equities | Apr 2009–Oct 2015 | Led business to leading global position . |
| Morgan Stanley | Co‑Head Global Capital Markets / Global ECM | Dec 2005–Jul 2009 | Supported capital raising through crisis; strategic advisory . |
| Morgan Stanley | Joined firm; promoted MD | 1990; MD in 2002 | Long-tenured operator; Operating Committee since 2012 . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| The Metropolitan Museum of Art | Trustee; Investment and Nominating & Governance Committees | Current | Non-profit governance and investment oversight . |
| Institute of International Finance | Board Member | Current | Industry policy network engagement . |
| Morgan Stanley Alliance for Children’s Mental Health | Chair, Advisory Board | Current | Human capital and ESG leadership . |
| Public company boards | None | — | Proxy lists no other U.S.-listed boards for Pick . |
Fixed Compensation
| Component | 2024 Amount (USD) |
|---|---|
| Base Salary | $1,500,000 |
| Cash Bonus | $8,125,000 |
Notes: Mr. Pick’s base salary was increased to align CEO pay structure; total CEO pay decision for 2024 was $34 million based on performance .
Performance Compensation
| Element | Metric | Weighting | Target | Actual/Payout | Vesting |
|---|---|---|---|---|---|
| RSUs (Deferred Equity) | Time-based | — | — | $4,875,000 grant; 35,632 RSUs | 50% converts Jan 27, 2027; 50% converts Jan 27, 2028; subject to cancellation/clawback . |
| PSUs (Deferred, Performance‑Vested) | Absolute ROTCE (avg 2025–2027) | 50% | 13% → 1.0x; 16% → 1.5x; 8% → 0.5x; <8% → 0.0x | Earns 0–1.5x; aggregate capped at 1.0 if MS Average ROTCE <9% | Converts end of 2027; accrues dividend equivalents; clawback if performance based on materially inaccurate financials . |
| PSUs (Deferred, Performance‑Vested) | Relative ROTCE vs peer group (avg 2025–2027) | 50% | 55th percentile → 1.0x; 75th → 1.5x; 25th → 0.5x; <25th → 0.0x | Earns 0–1.5x; cap applies as above | Same as above . |
| PSU Target Grant (2025 cycle) | ROTCE objectives (abs/relative) | 60% of incentive comp delivered as PSUs | 142,530 PSUs target; $19,500,000 grant value | Outcome contingent on 2025–2027 performance | Converts 2027 . |
Program features: 75% of CEO incentive comp deferred; 60% performance‑vested; 100% of deferred incentive in equity; robust cancellation and clawback provisions; double‑trigger change‑of‑control; no tax gross‑ups; no golden parachutes .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership | 557,499 common shares; 299,484 underlying stock units; total 856,983; none pledged; each individual <1% outstanding . |
| Outstanding Awards (12/31/2024) | 117,089 Staking RSUs ($14.72M); 523,112 PSUs at max ($65.77M) . |
| 2024 Stock Vested | 76,064 RSUs (2023 award) valued $6,412,500; 124,351 PSUs (2022 award) valued $15,645,704 . |
| Ownership Guidelines | CEO must hold 10x base salary in shares/equity; retain 75% of equity award shares in first five years; executives in compliance . |
| Hedging/Pledging | Prohibited for directors and executive officers . |
| Options | Firm does not currently grant options; none outstanding for NEOs . |
Vesting schedule and potential selling pressure:
- Staking RSUs: 117,089 units scheduled to convert on January 25, 2027; subject to cancellation/clawback and 75% retention requirement that constrains net sales .
- 2024 RSUs: 35,632 RSUs; 50% converts Jan 27, 2027 and 50% Jan 27, 2028; cancellation/clawback apply; retention rules limit disposals .
- PSUs: 2023 PSUs convert in 2026; 2024 and 2025 PSUs convert in 2027 based on ROTCE performance; conversion may add supply but retention requirements and clawbacks reduce sale volume .
Employment Terms
- Severance and change‑of‑control: No special severance; eligible only for broad-based Severance Pay Plan on involuntary termination (e.g., $200,000 cash severance illustrative in table); equity awards have double‑trigger vesting on change‑of‑control; RSUs payable upon death, governmental service termination or qualifying change‑of‑control termination; PSUs pay based on performance or target as specified for certain termination scenarios .
- Clawback/cancellation: Extensive triggers for misconduct, risk management violations, material adverse outcomes, restatements; PSU shares subject to Dodd‑Frank recoupment policy .
- Non‑compete/notice: Awards cancel for prohibited competitive activity; 180‑day notice and non‑solicitation agreement with injunctive relief and award cancellation if breached .
- Perquisites/pensions: No excessive perquisites; CEO reimburses for personal aircraft use within regulatory limits; no executive pensions beyond frozen ERP accruals; retiree health benefits available .
Board Governance
- Role and independence: Pick is Chairman and CEO and a management director; Board determined 11 of 14 nominees are independent (Pick not independent) .
- Lead Independent Director: Tom Glocer with expansive authorities (agenda approval, executive sessions, shareholder/regulator access) providing counterbalance to combined Chair/CEO structure .
- Committees: Management director does not serve on Board committees; key committees (Audit, CMDS, G&S) are fully independent; Risk and Operations & Technology are chaired by independents and comprised solely of non‑management directors .
- Attendance and oversight: Board met 14 times in 2024; each current director attended at least 75% of meetings; frequent executive sessions of non‑management and independent directors .
Director Compensation
- Employee directors (including Pick) receive no compensation for Board service; independent directors’ program includes cash retainers and equity (DECAP) with ownership requirements of 5x retainer .
Compensation Peer Group, Benchmarking, and Say‑on‑Pay
- Comparison group for program evaluation: Bank of America, Citigroup, Goldman Sachs, JPMorgan, Wells Fargo, Barclays, Deutsche Bank, UBS .
- CEO target range: Committee set 2024 CEO pay range from ≤$20M (below expectations) to ≥$40M (exceeds expectations) with the final decision at $34M based on exceptional performance .
- One‑time 2023 Staking Awards: $20M equity awards to incoming CEO and Co‑Presidents to secure leadership continuity; 60% PSUs/40% RSUs; no retirement vesting; subject to cancellation/clawback; not part of regular compensation practice .
- Say‑on‑Pay outcomes: Historical average support 93% (2014–2023); 2024 approval 75% with investor concerns on one‑time awards; enhanced engagement; no one‑time awards granted in 2024 .
Performance & Track Record
| Metric | 2024 Result |
|---|---|
| Net Revenues | $61.8B, record; +~14% YoY . |
| Net Income applicable to MS | ~$13.4B; +~47% YoY . |
| Diluted EPS | $7.95 . |
| ROTCE | 18.8% vs 12.8% in 2023 . |
| Efficiency Ratio | 71% . |
| CET1 Ratio | 15.9%; accreted $5.6B CET1 . |
| Dividends | Quarterly dividend raised to $0.925; $5.7B dividends paid . |
| TSR | 1‑year TSR 40%; outperformed S&P Financials peers over 1/3/5 years . |
Business segment achievements: Institutional Securities net revenues $28.1B (+22% YoY); wealth net revenues $28.4B with 27.2% pre‑tax margin; Investment Management net revenues $5.9B with AUM $1.7T; fee‑based flows $123B in Wealth .
Risk Indicators & Red Flags
- Combined Chair/CEO: Governance mitigants include strong Lead Independent Director and independent committees .
- One‑time awards: 2023 Staking Awards drew investor criticism; response included commitment to avoid such awards barring extraordinary circumstances .
- Hedging/pledging: Prohibited for executives; alignment positive .
- Tax gross‑ups/golden parachutes: None; double‑trigger equity acceleration only .
- Related party transactions: None for Pick; Firm policy and immaterial ordinary‑course transactions disclosed .
Upcoming Vesting Triggers (Trading Watch)
| Award | Units | Date | Notes |
|---|---|---|---|
| Staking RSUs (2023) | 117,089 | Jan 25, 2027 | Subject to cancellation/clawback; retention requirements limit net sales . |
| 2024 RSUs (for 2024 performance) | 35,632 | 50% on Jan 27, 2027; 50% on Jan 27, 2028 | Deferred equity; cancellation/clawback; retention applies . |
| 2023 PSUs | — | 2026 | Earned based on 2024–2026 (or specified) performance; payout 0–1.5x . |
| 2024 PSUs | Target 149,458 | 2027 | Absolute/relative ROTCE grid; cap at 1.0 if avg ROTCE <9% . |
| 2025 PSUs | Target 142,530 | 2027 | Same metrics; accrues dividend equivalents; clawback applies . |
Retention policy requires the CEO to retain 75% of net shares during first five years, damping potential selling pressure around conversions .
Investment Implications
- Strong pay‑for‑performance alignment: Heavy use of PSUs with absolute/relative ROTCE and multi‑year deferral/cancellation create high sensitivity to sustained profitability and capital discipline; 2024 results suggest likely PSU realizations above target if momentum continues .
- Limited near‑term selling overhang: Significant upcoming 2027 conversions are mitigated by strict retention requirements (CEO retains 75%) and clawback/cancellation features; nonetheless, watch Q1 2027 for RSU/PSU conversions as potential supply events .
- Governance trade‑off: Combined Chair/CEO with strong Lead Independent Director oversight; no golden parachutes or tax gross‑ups; robust clawbacks reduce tail‑risk of misaligned payouts .
- Shareholder sentiment: 2024 Say‑on‑Pay dip (75%) linked to 2023 one‑time awards; the absence of 2024 one‑time grants and enhanced engagement should stabilize future votes; monitor any future recourse to extraordinary grants .
- Execution risk and upside: 2024 performance across segments and ROTCE trajectory under Pick’s first year is a positive signal; continued delivery against ROTCE targets and asset‑led strategy in Wealth/IM are key levers for PSU payouts and valuation .