A promising Vanguard Group executive has left the company, instead of taking the top post he was given to oversee a key growth business for the Malvern investment giant.
In June, Vanguard CEO Tim Buckley named Phil Korenman, 37, to head Personal Advisor Services (PAS). The company is counting on the unit, which charges clients fees to advise on their investments, to help boost Vanguard revenues as fund management fees fall toward zero amid industry automation and competition. Korenman had earlier led the group that developed PAS while he was a Vanguard corporate strategist.
A Bloomberg analyst has called PAS "the Amazon of finance" for its impact on retail competitors. PAS assets have topped $100 billion, a small but fast-growing fraction of Vanguard clients' $5 trillion total, which largely includes low-fee stock and bond mutual funds and exchange-traded funds based on the S&P 500 and other market indices.
The appointment was to take effect this month, with Korenman replacing Frank Kolimago, a veteran Vanguard executive moving to Australia to head the company's business there, so former Vanguard Australia chief Colin Kelton can head back to Malvern as the parent company's top marketing officer.
But Korenman didn't take the top PAS job on schedule in August, and has instead left the company that was his only corporate home since he finished his undergraduate management degree at Penn State in 2002, Vanguard insiders told me.
"We are actively searching for a new head of Vanguard Personal Advisor Services," Vanguard spokesperson Emily M. Farrell confirmed. Korenman "is no longer with the company." Vanguard wouldn't say what sparked the change in plans. Korenman didn't respond to attempts to reach him online. Current and former Vanguard staff who worked with Korenman called him affable, and his sudden departure a mystery.
In an email last week to staff, Korenman's boss and past mentor, Vanguard retail chief Karin Risi, acknowledged the group had gone through a "less than awesome" time and an unusual management meeting, but assured them the unexpected leadership transition won't slow progress on adopting consultants' recommendations to speed PAS growth. She batted away suggestions PAS would be "hitting pause," and told them its management depth could keep growth plans on track.
Korenman had "played a critical role in the early days" of PAS as corporate strategist developing the group's "foundational design," Risi had written in a June email announcing Korenman's promotion. "We're thrilled," she added. "We're excited." And, "No pressure, Phil!"
Korenman seemed made for the PAS job. He rose quickly through the ranks, with five annual promotions after his arrival with a brand-new IT management degree in 2002, then several years as corporate strategist, before joining the management elite as a Principal in 2011 and leading efforts to set up PAS.
As he rose, Korenman prepped for a top management role, earning an MBA from Villanova, and last year going through Harvard's Advanced Management Program. He starred in promotional videos and Q&A interviews boosting the service.