Kelly: Investment management failures typically stem from misaligned incentive frameworks
Mike Kelly · Michael Kelly – Democratizing Access to the Middle Market at Future Standard (EP.473) · Nov 24, 2025 · at 18:14
Mike Kelly, Co-President and CIO of Future Standard and co-founder of Frontpoint Partners, discusses the primary lessons learned on aligning portfolio managers and staff with institutional client outcomes.
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“If you want individuals to act in a way where they are collaborating and working towards a client outcome, you have to appropriately construct those incentives correctly. That's often where in investment management things go awry. So I'm having a problem getting these guys that I'm managing to do what I want them to do. I always start by asking them, well, what's the incentive framework that you've designed to get them to do that? Because if you correctly frame the incentives, they will Behave appropriately. They're rational human beings.”
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