Executive Summary: For the first time in years, Vanguard shareholders are voting on trustees who oversee the funds on our behalf. This article examines how much the trustees have invested in Vanguard’s funds, asking if they are "eating their own cooking." The data reveals significant disparities in trustees’ commitment.
Mutual fund directors are either not being paid nearly enough for what they should be doing—or far too much for what they actually do.
– Jack Bogle, SmartMoney, July 2012
For the first time in seven years, Vanguard owners like you and me are getting to vote on the trustees who oversee Vanguard’s funds and ETFs on our behalf. Hooray!
With this shareholder vote in progress, I find myself asking an important question: Are Vanguard’s trustees (those already on the board plus the newest members up for election) invested alongside the shareholders they will soon represent?
It’s pretty straightforward for me: When I put my hard-earned money to work, I want to see that the people responsible for overseeing my investments also have a stake in my success. Or, as my mentor likes to ask, “Are they eating their own cooking?”
I firmly believe that’s an important question—it’s why I report on this every year (most recently in July) and maintain a detailed table showing trustee ownership fund by fund here.
Vanguard has belittled my focus on this metric, saying the performance speaks for itself. But that’s just it—sometimes the performance doesn’t speak highly of Vanguard’s stewardship, begging the question I pose every year.
Finding the answer to this question can be difficult. The data on Vanguard’s trustees’ investments is typically only disclosed in bits and pieces over the year and with a significant time lag.
Not so now, however. Buried in the voting materials for this rare shareholder vote is a table disclosing each nominee’s investments, fund by fund, as of September 30, 2024.
I wouldn’t say the data was easy to work with; the table (in the SEC document I unearthed and worked from) is poorly formatted and clunky. But the data’s there, and it covers ALL of the nominees—current trustees and new ones, including CEO Salim Ramji.
To be fair, the table in Vanguard's official proxy materials is cleaner than the SEC document. I'm still waiting to receive an email from Vanguard with my materials, but below is the proxy statement an IVA reader shared with me. (The ownership data is still buried on pages 61–71.)
Either way, as you should expect from me, I’ve done the heavy lifting to make this accessible and digestible for you. So, let’s see which trustees are eating what they’re cooking and which are just pushing their food around their plate.
Director or Trustee
Vanguard’s Board of Trustees is technically distinct from its Board of Directors.
The directors oversee Vanguard, the company, while the trustees oversee the funds (on our behalf). There is a lot of overlap between the two boards, but it's not perfect. For example, Vanguard’s CIO, Greg Davis, serves as a director but hasn’t been nominated as a trustee.
Frankly, I tend to use the terms (directors and trustees) interchangeably, but I’ll be more careful about this in the future.
Are They Eating What They’re Cooking?
Before I get into the numbers, beware that we are working with loose disclosure requirements. Board members must only report the value of their holdings in five broad categories: $0, $1–$10,000, $10,001–$50,000, $50,001–$100,000 and over $100,000.
The “over $100,000” bucket leaves a lot to be desired. It is a lot of money, but none of Vanguard’s trustees come to this job poor. Plus, Vanguard pays each independent trustee between $330,000 and $400,000 a year for their service, so there’s plenty of cash sloshing around for investment purposes. (It’s a good gig if you can get it.)
The table below provides a high-level look at each trustee, including the compensation they have received for their stewardship (through 2023) and the number of Vanguard funds they own.