10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q 

(Mark One)

☒      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the quarterly period ended March 31, 2023

OR

☐         TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from          to

Commission File Number: 001-38979

BRIGHTSPHERE
Investment Group Inc.

(Exact name of registrant as specified in its charter) 

Delaware		47-1121020
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
200 State Street, FL 13		02109
Boston,	Massachusetts
(Address of principal executive offices)		(Zip Code)

(617)-369-7300

(Registrant’s telephone number, including area code) 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Ticker Symbol	Name of each exchange on which registered
Common stock, par value $0.001 per share	BSIG	New York Stock Exchange
4.800% Notes due 2026	BSIG 26	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ý No o 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.:

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ý 

The number of shares of the registrant’s common stock, $0.001 per share, outstanding as of May 4, 2023 was 41,464,175.

TABLE OF CONTENTS

		Page
Part I	Financial Information	3
Item 1.	Financial Statements	3
	Condensed Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022	3
	Condensed Consolidated Statements of Operations for the three months ended March 31, 2023 and 2022	4
	Condensed Consolidated Statements of Comprehensive Income for the three months ended March 31, 2023 and 2022	5
	Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three months ended March 31, 2023 and 2022	6
	Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2023 and 2022	7
	Notes to Condensed Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	25
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	56
Item 4.	Controls and Procedures	58
Item 5.	Other Events	59
Part II	Other Information	59
Item 1.	Legal Proceedings	59
Item 1A.	Risk Factors	59
Item 6.	Exhibits	60

2

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements.

BrightSphere Investment Group Inc.

Condensed Consolidated Balance Sheets

(in millions, except for share and per share data, unaudited)

	March 31, 2023		December 31, 2022
Assets
Cash and cash equivalents	$	154.1	$	108.4
Investment advisory fees receivable	99.9		122.5
Income taxes receivable	—		2.0
Fixed assets, net	48.4		47.7
Right of use assets	61.3		59.9
Investments	49.9		48.4
Goodwill	20.3		20.3
Other assets	27.3		27.7
Deferred tax assets	65.9		64.7
Assets of consolidated Funds:
Cash and cash equivalents, restricted	12.6		12.8
Investments	2.8		1.9
Other assets	3.5		2.4
Total assets	$	546.0	$	518.7
Liabilities and stockholders’ equity
Accounts payable and accrued expenses	$	20.4	$	31.0
Accrued incentive compensation	24.0		92.5
Other compensation liabilities	60.1		59.3
Accrued income taxes	8.3		4.6
Operating lease liabilities	77.0		75.8
Other liabilities	0.8		1.1
Revolving credit facility	87.0		—
Third party borrowings	273.6		273.5
Liabilities of consolidated Funds:
Accounts payable and accrued expenses	0.5		0.3
Derivative liabilities at fair value	2.6		2.2
Total liabilities	554.3		540.3
Commitments and contingencies
Redeemable non-controlling interests in consolidated Funds	0.4		—
Equity:
Common stock (par value $0.001; 41,464,175 and 41,435,087 shares, respectively, issued)	—		—
Additional paid-in capital	1.4		1.5
Retained deficit	(0.8)		(12.5)
Accumulated other comprehensive loss	(9.3)		(10.6)
Total equity	(8.3)		(21.6)
Total liabilities and equity	$	546.0	$	518.7

See Notes to Condensed Consolidated Financial Statements

3

BrightSphere Investment Group Inc.

Condensed Consolidated Statements of Operations

(in millions except for per share data, unaudited)

	Three Months Ended March 31,
	2023		2022
Revenue:
Management fees	$	90.6	$	102.2
Performance fees	0.5		10.0
Consolidated Funds’ revenue	0.7		—
Total revenue	91.8		112.2
Operating expenses:
Compensation and benefits	49.1		46.8
General and administrative expense	18.4		16.9
Depreciation and amortization	3.8		5.3
Consolidated Funds’ expense	0.7		—
Total operating expenses	72.0		69.0
Operating income	19.8		43.2
Non-operating income and (expense):
Investment income (loss)	0.3		(0.1)
Interest income	1.1		—
Interest expense	(4.9)		(6.5)
Loss on extinguishment of debt	—		(3.2)
Net consolidated Funds’ investment gains	0.8		—
Total non-operating income (loss)	(2.7)		(9.8)
Income before income taxes	17.1		33.4
Income tax expense	5.1		9.6
Net income	12.0		23.8
Net income attributable to non-controlling interests in consolidated Funds	—		—
Net income attributable to controlling interests	$	12.0	$	23.8
Earnings per share (basic) attributable to controlling interests	$	0.29	$	0.54
Earnings per share (diluted) attributable to controlling interests	0.28		0.53
Weighted average common stock outstanding	41.4		44.0
Weighted average diluted common stock outstanding	42.7		45.3

See Notes to Condensed Consolidated Financial Statements

4

BrightSphere Investment Group Inc.

Condensed Consolidated Statements of Comprehensive Income

(in millions, unaudited)

	Three Months Ended March 31,
	2023		2022
Net income	$	12.0	$	23.8
Other comprehensive income (loss):
Amortization related to derivative securities, net of tax	0.6		1.6
Foreign currency translation adjustment	0.7		(0.7)
Total other comprehensive income	1.3		0.9
Comprehensive income attributable to non-controlling interests in consolidated Funds	—		—
Total comprehensive income attributable to controlling interests	$	13.3	$	24.7

See Notes to Condensed Consolidated Financial Statements

5

BrightSphere Investment Group Inc.

Condensed Consolidated Statements of Changes in Stockholders’ Equity

For the three months ended March 31, 2023 and 2022

($ in millions except share data, unaudited)

	Common stock (millions)	Common stock,  par value		Additional paid-in capital		Retained earnings (deficit)		Accumulated other comprehensive income (loss)		Total stockholders’ equity		Redeemable non-controlling interests in consolidated  Funds		Total equity and redeemable non-controlling interests in consolidated Funds
December 31, 2021	45.4	$	—	$	—	$	(6.8)	$	(10.8)	$	(17.6)	$	—	$	(17.6)
Issuance of common stock	0.2	—		—		—		—		—		—		—
Repurchase of common stock	(4.2)	—		—		(103.2)		—		(103.2)		—		(103.2)
Equity-based compensation	—	—		0.9		—		—		0.9		—		0.9
Foreign currency translation adjustment	—	—		—		—		(0.7)		(0.7)		—		(0.7)
Amortization related to derivatives securities, net of tax	—	—		—		—		1.6		1.6		—		1.6
Withholding tax related to stock option exercise				(0.9)		(1.4)		—		(2.3)				(2.3)
Dividends ($0.01 per share)	—	—		—		(0.4)		—		(0.4)		—		(0.4)
Net income	—	—		—		23.8		—		23.8		—		23.8
March 31, 2022	41.4	$	—	$	—	$	(88.0)	$	(9.9)	$	(97.9)	$	—	$	(97.9)
December 31, 2022	41.4	$	—	$	1.5	$	(12.5)	$	(10.6)	$	(21.6)	$	—	$	(21.6)
Issuance of common stock	0.1	—		—		—		—		—		—		—
Net capital contributions	—	—		—		—		—		—		0.4		0.4
Equity-based compensation	—	—		0.2		—		—		0.2		—		0.2
Foreign currency translation adjustment	—	—		—		—		0.7		0.7		—		0.7
Amortization related to derivative securities, net of tax	—	—		—		—		0.6		0.6		—		0.6
Withholding tax related to stock option exercise and restricted stock vesting	—	—		(0.3)		—		—		(0.3)		—		(0.3)
Dividends ($0.01 per share)	—	—		—		(0.3)		—		(0.3)		—		(0.3)
Net income	—	—		—		12.0		—		12.0		—		12.0
March 31, 2023	41.5	$	—	$	1.4	$	(0.8)	$	(9.3)	$	(8.7)	$	0.4	$	(8.3)

See Notes to Condensed Consolidated Financial Statements

6

BrightSphere Investment Group Inc. Condensed Consolidated Statements of Cash Flows (in millions, unaudited)
	Three Months Ended March 31,
	2023	2022
Cash flows from operating activities:
Net income	12.0	23.8
Less: Net (income) loss attributable to redeemable non-controlling interests in consolidated Funds	—	—
Adjustments to reconcile net income to net cash flows from operating activities:
Loss on extinguishment of debt	—	3.2
Depreciation and other amortization	3.8	5.3
Amortization of debt-related costs	1.0	2.7
Amortization and revaluation of non-cash compensation awards	1.2	(4.2)
Deferred income taxes	(1.0)	0.8
(Gains) losses on other investments	(1.1)	1.2
Changes in operating assets and liabilities:
Decrease in investment advisory fees receivable	22.6	52.7
Decrease in other receivables, prepayments, deposits and other assets	0.8	0.4
Decrease in accrued incentive compensation, operating lease liabilities and other liabilities	(68.8)	(92.2)
Decrease in accounts payable, accrued expenses and accrued income taxes	(4.8)	(8.1)
Net cash flows from operating activities	(34.3)	(14.4)
Adjustments to reconcile net income (loss) attributable to redeemable non-controlling interests of consolidated Funds to net cash flows from operating activities:
Purchase of investments	(0.1)	—
Sale of investments	0.4	—
(Increase) decrease in receivables and other assets	(1.0)	—
Increase in accounts payable and other liabilities	0.1	—
Net cash flows from operating activities of consolidated Funds	(0.6)	—
Net cash flows from operating activities	(34.9)	(14.4)
Cash flows from investing activities:
Additions of fixed assets	(4.5)	(4.0)
Purchase of investment securities	(2.6)	(4.8)
Sale of investment securities	1.5	4.8
Net cash flows from investing activities	(5.6)	(4.0)

See Notes to Condensed Consolidated Financial Statements

7

BrightSphere Investment Group Inc. Condensed Consolidated Statements of Cash Flows (in millions, unaudited)
	Three Months Ended March 31,
	2023		2022
Cash flows from financing activities:
Proceeds from revolving credit facility	100.0		125.0
Repayment of third party borrowings and revolving credit facility	(13.0)		(162.0)
Payment for debt issuance costs	—		(0.9)
Payment to OM plc for co-investment redemptions	(0.4)		(1.1)
Dividends paid to stockholders	(0.5)		(0.3)
Dividends paid to related parties	(0.3)		(0.1)
Repurchases of common stock	—		(103.2)
Withholding tax payments related to stock option exercise and restricted stock vesting	(0.3)		(2.3)
Cash flows from financing activities of consolidated Funds
Redeemable non-controlling interest capital raised	0.4		—
Net cash flows from financing activities	85.9		(144.9)
Effect of foreign exchange rate changes on cash and cash equivalents	0.1		—
Net increase (decrease) in cash and cash equivalents	45.5		(163.3)
Cash and cash equivalents at beginning of period	$	121.2	$	252.1
Cash and cash equivalents at end of period	$	166.7	$	88.8
Supplemental disclosure of cash flow information:
Interest paid	$	7.1	$	8.0
Income taxes paid	0.8		3.0

See Notes to Condensed Consolidated Financial Statements

8

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

1) Organization and Description of the Business

BrightSphere Investment Group Inc. (“BrightSphere”, “BSIG” or the “Company”), through its subsidiaries, is a global asset management company. The Company provides investment management services globally to predominantly institutional investors. The Company historically held interests in a diverse group of investment management firms (the “Affiliates”) individually headquartered in the United States. The Company completed the disposition of certain Affiliates and, beginning in 2021, has operated the business through one Affiliate, Acadian Asset Management LLC (“Acadian”). Acadian comprises the Company’s Quant & Solutions reportable segment:

•Quant & Solutions—comprised of versatile, often highly-tailored strategies that leverage data and technology in a computational, factor-based investment process across a range of asset classes in developed and emerging markets, including global, non-U.S. and small-cap equities, as well as managed volatility, ESG, multi-asset, equity alternatives, and long/short strategies.

Acadian is organized as a limited liability company. Fees for services are largely asset-based and, as a result, revenues fluctuate based on the performance of financial markets and investors’ asset flows in and out of Acadian’s products. The Company utilizes a profit-sharing model in structuring its compensation and ownership arrangements with Acadian. Variable compensation is based on the firm’s profitability. BSIG and Acadian key employees share in profits after variable compensation according to their respective ownership interests. The profit-sharing model results in the alignment of BSIG and Acadian key employee economic interests, which is critical to the Company’s talent management strategy and long-term growth of the business. The corporate head office is included within the Other category.

Prior to 2014, the Company was a wholly-owned subsidiary of Old Mutual plc (“OM plc”), an international long-term savings, protection, and investment group, listed on the London Stock Exchange. On October 15, 2014, the Company completed the initial public offering (the “Offering”) by OM plc pursuant to the Securities Act of 1933, as amended. As of March 31, 2023, Paulson & Co. Inc. (“Paulson”) held approximately 21.6% of the common stock of the Company.

For the three months ended March 31, 2023, the Company did not repurchase any shares of common stock. For the three months ended March 31, 2022, the Company repurchased 4,147,450 shares of common stock at an average price of $24.09 per share, or approximately $100 million in total, including commissions.

All shares of common stock repurchased by the Company were retired.

9

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

2) Basis of Presentation and Significant Accounting Policies

The Company’s significant accounting policies are as follows:

Basis of presentation

These unaudited Condensed Consolidated Financial Statements reflect the historical balance sheets, statements of operations, statements of comprehensive income, statements of changes in stockholders’ equity and statements of cash flows of the Company. Within these Condensed Consolidated Financial Statements, Paulson and its related entities, as defined above, are referred to as “related parties.”

The Condensed Consolidated Financial Statements are prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). In the opinion of management, all normal and recurring adjustments considered necessary for a fair presentation of the Company’s Condensed Consolidated Financial Statements have been included. All dollar amounts, except per-share data in the text and tables herein, are stated in millions unless otherwise indicated. Transactions between the Company and its related parties are included in the Condensed Consolidated Financial Statements; however, material intercompany balances and transactions among the Company, its consolidated Affiliate and consolidated Funds are eliminated in consolidation.

Certain disclosures included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 (annual report on Form 10-K) are not required to be included on an interim basis in the Company’s quarterly reports on Form 10-Q. The Company has condensed or omitted these disclosures. These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and notes thereto for the year ended December 31, 2022 included in the Company’s Annual Report on Form 10-K as filed with the Securities and Exchange Commission (“SEC”) on February 28, 2023. The Company’s significant accounting policies, which have been consistently applied, are summarized in those financial statements.

Use of estimates

The preparation of these Condensed Consolidated Financial Statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from such estimates, and the differences may be material to the Condensed Consolidated Financial Statements.

New accounting standards not yet adopted

The Company has considered all newly issued accounting guidance that is applicable to the Company’s operations and the preparation of the unaudited Condensed Consolidated Financial Statements, including those that have not yet been adopted. The Company does not believe that any such guidance has or will have a material effect on its Condensed Consolidated Financial Statements and related disclosures.

10

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

3) Investments

Investments are comprised of the following as of the dates indicated (in millions):

	March 31, 2023		December 31, 2022
Investments of consolidated Funds held at fair value	$	2.8	$	1.9
Seed & Other investments	$	8.7	$	8.4
Investments related to long-term incentive compensation plans	41.2		40.0
Total investments per Condensed Consolidated Balance Sheets	$	52.7	$	50.3

4) Fair Value Measurements

The following table summarizes the Company’s assets that are measured at fair value on a recurring basis at March 31, 2023 (in millions):

	Quoted prices in active markets (Level I)		Significant other observable inputs (Level II)		Significant unobservable inputs (Level III)		Uncategorized		Total value, March 31, 2023
Assets of BSIG and consolidated Funds(1)
Derivatives	$	0.3	$	2.5	$	—	$	—	$	2.8
Consolidated Funds total	0.3		2.5		—		—		2.8
Investments in separate accounts(2)	4.4		—		—		—		4.4
Investments related to long-term incentive compensation plans(3)	41.2		—		—		—		41.2
Investments in unconsolidated Funds(4)	—		—		—		4.3		4.3
BSIG total	45.6		—		—		4.3		49.9
Total fair value assets	$	45.9	$	2.5	$	—	$	4.3	$	52.7
Liabilities of consolidated Funds(1)
Derivatives	$	(0.3)	$	(2.3)	$	—	$	—	$	(2.6)
Consolidated Funds total	(0.3)		(2.3)		—		—		(2.6)
Total fair value liabilities	$	(0.3)	$	(2.3)	$	—	$	—	$	(2.6)

11

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

4) Fair Value Measurements (cont.)

The following table summarizes the Company’s assets that are measured at fair value on a recurring basis at December 31, 2022 (in millions):

	Quoted prices in active markets (Level I)		Significant other observable inputs (Level II)		Significant unobservable inputs (Level III)		Uncategorized		Total value December 31, 2022
Assets of BSIG and consolidated Funds(1)
Derivatives	0.3		1.6		—		—		1.9
Consolidated Funds total	0.3		1.6		—		—		1.9
Investments in separate accounts(2)	$	4.2	$	—	$	—	$	—	$	4.2
Investments related to long-term incentive compensation plans(3)	40.0		—		—		—		40.0
Investments in unconsolidated Funds(4)	—		—		—		4.2		4.2
BSIG total	44.2		—		—		4.2		48.4
Total fair value assets	$	44.5	$	1.6	$	—	$	4.2	$	50.3
Liabilities of consolidated Funds(1)
Derivatives	(0.2)		(2.0)		—		—		(2.2)
Consolidated Funds total	(0.2)		(2.0)		—		—		(2.2)
Total fair value liabilities	$	(0.2)	$	(2.0)	$	—	$	—	$	(2.2)

(1)Assets and liabilities measured at fair value are comprised of financial investments managed by the Company's Affiliate.

Derivatives which are traded on a national securities exchange are stated at the last reported sales price on the day of valuation. To the extent these securities are actively traded and valuation adjustments are not applied, they are classified as Level I. The securities that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs obtained by the Company from independent pricing services are classified as Level II.

The Company obtains prices from independent pricing services that may utilize broker quotes, but generally the independent pricing services will use various other pricing techniques which take into account appropriate factors such as yield, quality, coupon rate, maturity, type of issue, trading characteristics and other data. The Company has not made adjustments to the prices provided.

If the pricing services are only able to (a) obtain a single broker quote or (b) utilize a pricing model, such securities are classified as Level III. If the pricing services are unable to provide prices, the Company attempts to obtain one or more broker quotes directly from a dealer or values such securities at the last bid price obtained. In either case, such securities are classified as Level III. The Company performs due diligence procedures over third party pricing vendors to understand their methodology and controls to support their use in the valuation process to ensure compliance with required accounting disclosures.

(2)Investments in separate accounts of $4.4 million at March 31, 2023 consist of 100% equity securities and other investments. Investments in separate accounts of $4.2 million at December 31, 2022 consist of approximately 100% of equity securities and other investments. The Company values these using the

12

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

4) Fair Value Measurements (cont.)

published price of the underlying securities (classified as Level I) or quoted price supported by observable inputs as of the measurement date (classified as Level II).

(3)Investments related to long-term incentive compensation plans of $41.2 million and $40.0 million at March 31, 2023 and December 31, 2022, respectively, were investments in publicly registered daily redeemable funds (some managed by Acadian), which the Company has classified as trading securities and valued using the published price as of the measurement dates. Accordingly, the Company has classified these investments as Level I.

(4)The uncategorized amounts of $4.3 million and $4.2 million at March 31, 2023 and December 31, 2022, respectively, relate to investments in unconsolidated Funds which consist primarily of investments in Funds and are valued using NAV which the Company relies on to determine their fair value as a practical expedient and has therefore not classified these investments in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to amounts presented in the Condensed Consolidated Balance Sheets. These unconsolidated Funds consist primarily of real estate investment Funds, UCITS and other investment vehicles. The NAVs that have been provided by investees have been derived from the fair values of the underlying investments as of the measurement dates. UCITS and other investment vehicles are not subject to redemption restrictions.

The real estate investment Funds of $4.2 million and $4.1 million at March 31, 2023 and December 31, 2022, respectively, are subject to longer than quarterly redemption restrictions, and due to their nature, distributions are received only as cash flows are generated from underlying assets over the life of the Funds. The range of time over which the underlying assets are expected to be liquidated by the investees is approximately one to two years from March 31, 2023. The valuation process for the underlying real estate investments held by the real estate investment Funds begins with each property or loan being valued by the investment teams. The valuations are then reviewed and approved by the valuation committee, which consists of senior members of the portfolio management, acquisitions, and research teams. For certain properties and loans, the valuation process may also include a valuation by independent appraisers. In connection with this process, changes in fair value measurements from period to period are evaluated for reasonableness, considering items such as market rents, capitalization and discount rates, and general economic and market conditions.

There were no significant transfers of financial assets or liabilities between Levels II or III during the three months ended March 31, 2023 and 2022, respectively.

5) Variable Interest Entities

The Company, through its Affiliate, sponsors the formation of various entities considered to be variable interest entities (“VIEs”). These VIEs are primarily Funds managed by the Company’s Affiliate, and other partnership interests typically owned entirely by third-party investors. Certain Funds may be capitalized with seed capital investments from the Company and may be owned partially by Affiliate key employees and/or individuals that have ownership interests in the Affiliate.

The Company’s determination of whether it is the primary beneficiary of a Fund that is a VIE is based in part on an assessment of whether or not the Company and its related parties are exposed to absorb more than an insignificant amount of the risks and rewards of the entity. Typically the Fund’s investors are entitled to substantially all of the economics of these VIEs with the exception of the management fees and performance fees, if any, earned by the Company or any investment the Company has made into the Funds. The Company generally is not the primary

13

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

5) Variable Interest Entities (cont.)

beneficiary of Fund VIEs created to manage assets for clients unless the Company’s ownership interest, including interests of related parties, is substantial.

The following table presents the assets and liabilities of Funds that are VIEs and consolidated by the Company (in millions):

	March 31, 2023		December 31, 2022
Assets
Investments at fair value	$	2.8	$	1.9
Other assets of consolidated Funds	16.1		$	15.2
Total Assets	$	18.9	$	17.1
Liabilities
Liabilities of consolidated Funds	3.1		2.5
Total Liabilities	$	3.1	$	2.5

“Investments at fair value” consist of investments in derivative securities. To the extent the Company also has consolidated Funds that are not VIEs, the assets and liabilities of those Funds are not included in the table above.

The assets of consolidated VIEs presented in the table above belong to the investors in those Funds, are available for use only by the Fund to which they belong, and are not available for use by the Company to the extent they are held by non-controlling interests. Any debt or liabilities held by consolidated Funds have no recourse to the Company’s general credit.

The Company’s involvement with Funds that are VIEs and not consolidated by the Company is generally limited to that of an investment manager and its investment in the unconsolidated VIE, if any. The Company’s investment in any unconsolidated VIE generally represents an insignificant interest of the Fund’s net assets and assets under management, such that the majority of the VIE’s results are attributable to third parties. The Company’s exposure to risk in these entities is generally limited to any capital contribution it has made or is required to make and any earned but uncollected management fees. The Company has not issued any investment performance guarantees to these VIEs or their investors.

The following information pertains to unconsolidated VIEs for which the Company holds a variable interest (in millions):

	March 31, 2023		December 31, 2022
Unconsolidated VIE assets	$	742.5	$	728.1
Unconsolidated VIE liabilities	$	310.6	$	303.6
Equity interests on the Condensed Consolidated Balance Sheets	$	4.2	$	4.1
Maximum risk of loss(1)	$	4.2	$	4.1

(1)Includes equity investments the Company has made or is required to make.

14

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

6) Borrowings and Debt

The Company’s borrowings and long-term debt was comprised of the following as of the dates indicated (in millions):

	March 31, 2023					December 31, 2022
(in millions)	Carrying Value		Fair Value		Fair Value Level	Carrying Value		Fair Value		Fair Value Level
Revolving credit facility:
$125 million revolving credit facility expiring March 7, 2025(1)	$	87.0	$	87.0	2	$	—	$	—
Total revolving credit facility	$	87.0	$	87.0		$	—	$	—
Third party borrowings:
$275 million 4.80% Senior Notes Due July 27, 2026(2)	$	273.6	$	257.2	2	$	273.5	$	249.7	2
$125 million 5.125% Senior Notes Due August 1, 2031(2)(3)	—		—			—		—
Total third party borrowings	$	273.6	$	257.2		$	273.5	$	249.7

(1)Fair value approximates carrying value because the credit facility has variable interest rates based on selected short term market rates.

(2)The difference between the principal amounts and the carrying values of the senior notes in the table above reflects the unamortized debt issuance costs and discounts.

(3)On January 18, 2022, the Company completed the full redemption of the $125 million aggregate principal amount outstanding of its 5.125% Senior Notes due August 1, 2031. As a result of this transaction, the Company recorded a $3.2 million loss on extinguishment of debt within the Condensed Consolidated Statements of Operations for the three months ended March 31, 2022.

Revolving Credit Facility

On March 7, 2022, the Company, Royal Bank of Canada, BMO Harris Bank, N.A., Goldman Sachs Bank USA, Morgan Stanley Bank, N.A., Bank of America N.A., the Bank of New York Mellon and Citibank, N.A., as an issuing bank and administrative agent (collectively, the “Lenders”), entered into a new revolving credit facility agreement (the “Acadian Credit Agreement”), which replaced the Company’s revolving credit facility dated as of August 20, 2019 (as amended by an amendment dated September 3, 2020 and an assignment and assumption and amendment agreement dated February 23, 2021, the “Original Credit Agreement”). The maturity date of this Original Credit Agreement was August 22, 2022, and the maturity date of the Acadian Credit Agreement is March 7, 2025.

15

BrightSphere Investment Group Inc.

Notes to Consolidated Financial Statements

(unaudited)

6) Borrowings and Debt (cont.)

Borrowings under the Acadian Credit Agreement bear interest, at Acadian’s option, at the per annum rate equal to either (a) the greatest of (i) the prime rate, (ii) the federal funds effective rate plus 0.5% and (iii) the secured overnight financing rate for a one month period plus a credit spread adjustment of 0.10% (“Adjusted Term SOFR”) plus 1%, plus, in each case, an additional amount ranging from 0.5% to 1.0%, with such additional amount based on Acadian’s Leverage Ratio (as defined below) or (b) Adjusted Term SOFR plus an additional amount ranging from 1.5% to 2.0%, with such additional amount based on Acadian’s Leverage Ratio. In addition, Acadian is charged a commitment fee based on the average daily unused portion of the revolving credit facility under the Acadian Credit Agreement at a per annum rate ranging from 0.25% to 0.375%, with such amount based on Acadian’s Leverage Ratio.

Under the Acadian Credit Agreement, the ratio of Acadian’s third-party borrowings to Acadian’s trailing twelve months Adjusted EBITDA, as defined by the Acadian Credit Agreement (the “Leverage Ratio”), cannot exceed 2.5x and the Acadian interest coverage ratio must not be less than 4.0x.

7) Leases

The Company has operating leases for corporate offices, data centers and certain equipment. The operating leases have remaining lease terms of less than 1 year to 11 years, some of which include options to extend the leases for up to 5 years.

The following table summarizes information about the Company’s operating leases for the three months ended March 31 (in millions):

	Three Months Ended March 31,
	2023		2022
Operating lease cost	$	2.1	$	2.5
Variable lease cost	—		—
Sublease income	—		(0.1)
Total operating lease expense	$	2.1	$	2.4
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	2.3	$	2.2
Right of use assets obtained in exchange for new operating lease liabilities	2.8		—

In determining the incremental borrowing rate, the Company considered the interest rate yield for the specific interest rate environment and the Company’s credit spread at the inception of the lease. For the three months ended March 31, 2023 and 2022, the weighted average remaining lease term was 10.2 and 11.2, respectively, and the weighted average discount rate was 3.54% and 3.35%, respectively.

16

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

7) Leases (cont.)

Maturities of operating lease liabilities were as follows (in millions):

	Operating Leases
Year Ending December 31,
2023 (excluding the three months ended March 31, 2023)	$	7.0
2024	9.0
2025	8.8
2026	8.8
2027	8.4
Thereafter	49.6
Total lease payments	$	91.6
Less imputed interest	(14.6)
Total	$	77.0

8) Commitments and Contingencies

Operational commitments

A number of our subsidiaries operate under regulatory authorities that require that they maintain minimum financial or capital requirements. Management is not aware of any violations of such financial requirements occurring during the period.

Included in cash and cash equivalents is $3.6 million pertaining to the wind-down of BrightSphere Investment U.K., Ltd.

Guaranty

The Company entered into a guaranty for an office space security deposit in the amount of $2.5 million in January 2020. This represents the maximum potential amount of future (undiscounted) payments that the Company could be required to make under the guaranty in the event of default by the guaranteed parties. This guaranty expires in 2033. There are no liabilities recorded on the Condensed Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022 related to this guaranty.

Litigation

The Company is subject to claims, legal proceedings, and other contingencies in the ordinary course of its business activities. Each of these matters is subject to various uncertainties, and it is possible that some of these matters may be resolved in a manner unfavorable to the Company. The Company establishes accruals for matters for which the outcome is probable and can be reasonably estimated. As of March 31, 2023, there were no material accruals for claims and the Company does not believe any outstanding matters will have a material adverse effect on the Company.

17

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

8) Commitments and Contingencies (cont.)

Indemnifications

In the normal course of business, such as through agreements to enter into business combinations and divestitures of Affiliates, the Company enters into contracts that contain a variety of representations and warranties and which provide general indemnifications. The Company’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Company that have not yet occurred.

Foreign tax contingency

The Company has clients in non-U.S. jurisdictions which require entities that are conducting certain business activities in such jurisdictions to collect and remit tax assessed on certain fees paid for goods and services provided. The Company does not believe this requirement is applicable based on its limited business activities in these jurisdictions. However, given the fact that uncertainty exists around the requirement, the Company has chosen to evaluate its potential exposure related to non-collection and remittance of these taxes. At March 31, 2023, management of the Company has estimated the potential maximum exposure and concluded that it is not material. No accrual for the potential exposure has been recorded as the probability of incurring any potential liability relating to this exposure is not probable at March 31, 2023.

Considerations of credit risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash, cash equivalents, restricted cash and investments. The Company maintains cash and cash equivalents and short term investments with various financial institutions. These financial institutions are typically located in cities in which the Company and its Affiliate operate. For the Company and its Affiliate, cash deposits at a financial institution may exceed Federal Deposit Insurance Corporation insurance limits. Additionally, the Company holds insurance policies which cover historical and future tax benefits relating to certain of its deferred tax assets. The insurers of the policies are considered a significant counterparty to the Company.

18

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

9) Earnings Per Share

Basic earnings per share is calculated by dividing net income attributable to controlling interests by the weighted-average number of shares of common stock outstanding. Diluted earnings per share is similar to basic earnings per share, but is adjusted for the effect of potentially issuable common stock, except when inclusion is antidilutive.

The calculation of basic and diluted earnings per share of common stock is as follows (dollars in millions, except per share data):

	Three Months Ended March 31,
	2023		2022
Numerator:
Net income attributable to common stock	$	12.0	$	23.8
Denominator:
Weighted-average shares of common stock outstanding—basic	41,444,200		43,969,713
Potential shares of common stock:
Restricted stock units	7,539		10,112
Employee stock options	1,258,838		1,347,565
Weighted-average shares of common stock outstanding—diluted	42,710,577		45,327,390
Earnings per share of common stock attributable to controlling interests:
Basic	$	0.29	$	0.54
Diluted	$	0.28	$	0.53

19

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

10) Revenue

Management fees

The Company’s management fees are a function of the fee rates the Affiliate charges to it’s clients, which are typically expressed in basis points, and the levels of the Company’s assets under management. The most significant driver of increases or decreases in this average fee rate is changes in the mix of the Company’s assets under management caused by net inflows or outflows in certain asset classes or disproportionate market movements.

Performance fees

The Company’s products subject to performance fees earn these fees upon exceeding high-water mark performance thresholds or outperforming a hurdle rate. Performance fees are recorded in revenues when the contractual performance criteria have been met and when it is probable that a significant reversal of revenue recognized will not occur in future reporting periods.

Disaggregation of management fee revenue

The geographic disaggregation of management fee revenue for the three months ended March 31 (in millions) are presented below:

	Three Months Ended March 31,
	2023		2022
Quant & Solutions
U.S.	$	67.9	$	77.0
Non-U.S.	22.7		25.2
Management fee revenue	$	90.6	$	102.2

20

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

11) Accumulated Other Comprehensive Income (Loss)

The components of accumulated other comprehensive income (loss), net of tax, for the three months ended March 31, 2023 and 2022 are as follows (in millions):

	Foreign currency translation adjustment		Valuation and amortization of derivative securities		Total
Balance, as of December 31, 2022	$	1.7	$	(12.3)	$	(10.6)
Foreign currency translation adjustment	0.7		—		0.7
Amortization related to derivatives securities, before tax	—		0.8		0.8
Tax impact	—		(0.2)		(0.2)
Other comprehensive income	0.7		0.6		1.3
Balance, as of March 31, 2023	$	2.4	$	(11.7)	$	(9.3)

	Foreign currency translation adjustment		Valuation and amortization of derivative securities		Total
Balance, as of December 31, 2021	$	4.8	$	(15.6)	$	(10.8)
Foreign currency translation adjustment	(0.7)		—		(0.7)
Amortization related to derivatives securities, before tax(1)	—		2.2		2.2
Tax impact	—		(0.6)		(0.6)
Other comprehensive income (loss)	(0.7)		1.6		0.9
Balance, as of March 31, 2022	$	4.1	$	(14.0)	$	(9.9)

(1)On January 18, 2022, the Company completed the full redemption of the $125 million aggregate principal amount outstanding of its 5.125% Senior Notes due August 1, 2031. As a result of this transaction, the Company recorded $1.3 million of amortization expense included in Amortization related to derivatives securities, before tax for the three months ended March 31, 2022.

12) Derivatives and Hedging

Cash flow hedge

In July 2015, the Company entered into a series of $300.0 million notional Treasury rate lock contracts which were designated and qualified as cash flow hedges. The Company documented its hedging strategy and risk management objective for this contract in anticipation of a future debt issuance. The Treasury rate lock contract eliminated the impact of fluctuations in the underlying benchmark interest rate for future forecasted debt issuances. The Company assessed the effectiveness of the hedging contract at inception and on a quarterly basis thereafter. The forecasted debt issuances occurred in July 2016 and the Treasury rate lock, which had an accumulated fair value of $(34.4) million, was settled.

21

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

12) Derivatives and Hedging (cont.)

As of March 31, 2023, the balance recorded in accumulated other comprehensive income (loss) was $(11.7) million, net of tax. This balance will be reclassified to earnings through interest expense over the life of the issued debt. Amounts of $0.8 million and $2.2 million have been reclassified for the three months ended March 31, 2023 and 2022, respectively. During the next twelve months the Company expects to reclassify approximately $3.5 million to interest expense.

On January 18, 2022, the Company completed the full redemption of the $125 million aggregate principal amount outstanding of its 5.125% Senior Notes due August 1, 2031. As a result of this transaction, amortization expense of $1.3 million (of the $2.2 million interest expense reclassified to earnings for the three months ended March 31, 2022) was reclassified to earnings as interest expense.

13) Segments

The Company has the following reportable segment:

•Quant & Solutions—comprised of versatile, often highly-tailored strategies that leverage data and technology in a computational, factor-based investment process across a range of asset classes in developed and emerging markets, including global, non-U.S. and small-cap equities, as well as managed volatility, ESG, multi-asset, equity alternatives, and long/short strategies. This segment is comprised of the Company’s interest in Acadian.

The corporate head office is included within the Other category. The corporate head office expenses are not allocated to the Company’s business segment but the Chief Operating Decision Maker (“CODM”) does consider the cost structure of the corporate head office when evaluating the financial performance of the segment.

Performance Measure

The primary measure used by the CODM in measuring performance and allocating resources to the segments is Economic Net Income (“ENI”). The Company defines ENI for the segments as ENI revenue less (i) ENI operating expenses, (ii) variable compensation and (iii) key employee distributions. The ENI adjustments to U.S. GAAP include both reclassifications of U.S. GAAP revenue and expense items, as well as adjustments to U.S. GAAP results, primarily to exclude non-cash, non-economic expenses, or to reflect cash benefits not recognized under U.S. GAAP. This measure supplements and should be considered in addition to, and not in lieu of, the Condensed Consolidated Statements of Operations prepared in accordance with U.S. GAAP. The Company does not disclose total asset information for its reportable segment as the information is not reviewed by the CODM.

ENI revenue includes management fees, performance fees and other revenue under U.S. GAAP, adjusted to include management fees paid to Affiliates by consolidated Funds and the Company’s share of earnings from equity-accounted Affiliate.

ENI operating expenses include compensation and benefits, general and administrative expense, and depreciation and amortization under U.S. GAAP, adjusted to exclude non-cash expenses representing changes in the value of Affiliate equity and profit interests held by Affiliate key employees, goodwill impairment and amortization of acquired intangible assets, capital transaction costs and restructuring costs. Additionally, variable compensation and Affiliate key employee distributions are segregated from ENI operating expenses.

ENI segment results are also adjusted to exclude the portion of consolidated Fund revenues, expenses and investment return recorded under U.S. GAAP.

22

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

13) Segments (cont.)

Segment Presentation

The following tables set forth summarized operating results for the Company’s segment and related adjustments necessary to reconcile the segment economic net income to arrive at the Company’s consolidated U.S. GAAP net income (loss).

The following table presents the financial data for the Company’s segment for the three months ended March 31, 2023 (in millions):

	Three Months Ended March 31, 2023
	Quant & Solutions		Other		Reconciling Adjustments			Total U.S. GAAP(1)
ENI revenue	$	91.1	$	—	$	0.7		$	91.8
ENI operating expenses	43.6		3.5		0.5		(a)	47.6
Earnings before variable compensation	47.5		(3.5)		0.2			44.2
Variable compensation	22.5		0.7		—			23.2
ENI operating earnings (after variable comp)	25.0		(4.2)		0.2			21.0
Affiliate key employee distributions	1.2		—		—			1.2
Earnings after Affiliate key employee distributions	23.8		(4.2)		0.2			19.8
Net interest expense	—		(3.4)		(0.4)		(b)	(3.8)
Net investment income	—		—		1.1		(c)	1.1
Income tax expense	—		(4.4)		(0.7)		(d)	(5.1)
Economic net income	$	23.8	$	(12.0)	$	0.2		$	12.0

23

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

13) Segments (cont.)

The following table presents the financial data for the Company’s segment for the three months ended March 31, 2022 (in millions):

	Three Months Ended March 31, 2022
	Quant & Solutions		Other		Reconciling Adjustments			Total U.S. GAAP(1)
ENI revenue	$	112.2	$	—	$	—		$	112.2
ENI operating expenses	41.1		4.5		(6.4)		(a)	39.2
Earnings before variable compensation	71.1		(4.5)		6.4			73.0
Variable compensation	26.3		1.6		—			27.9
ENI operating earnings (after variable comp)	44.8		(6.1)		6.4			45.1
Affiliate key employee distributions	1.9		—		—			1.9
Earnings after Affiliate key employee distributions	42.9		(6.1)		6.4			43.2
Net interest expense	—		(4.6)		(1.9)		(b)	(6.5)
Net investment income (loss)	—		—		(0.1)		(c)	(0.1)
Loss on extinguishment of debt	—		—		(3.2)		(c)	(3.2)
Income tax expense	—		(8.8)		(0.8)		(d)	(9.6)
Economic net income	$	42.9	$	(19.5)	$	0.4		$	23.8

(1)The most directly comparable U.S. GAAP measure of ENI revenue is U.S. GAAP revenue. The most directly comparable U.S. GAAP measure of ENI operating expenses is U.S. GAAP operating expenses, which is comprised of ENI operating expenses, variable compensation, and Affiliate key employee distributions above. The most directly comparable U.S. GAAP measure of earnings after Affiliate key employee distributions is U.S. GAAP operating income. The most directly comparable U.S. GAAP measure of ENI is U.S. GAAP net income attributable to controlling interests.

Reconciling Adjustments:

a.Adjusted to include non-cash expenses for key employee equity and profit interest revaluations, capital transaction costs, amortization of acquired intangible assets and restructuring costs, each of which are included in U.S. GAAP operating expenses.

b.Adjusted to include the cost of seed financing and amortization of debt issuance costs, which is included in U.S. GAAP interest expense.

c.Adjusted to include net investment income (loss), the loss on extinguishment of debt, net income attributable to non-controlling interests in consolidated Funds, and net of tax, all of which are included in U.S. GAAP net income attributable to controlling interests.

d.Adjusted to include the impact of deferred tax attributable to the amortization of goodwill and acquired intangibles. Also adjusted to include the tax impact of certain ENI adjustments; exclude the tax expense or benefits relating to uncertain tax positions, and exclude the tax impact of other unusual items that are not related to current operating results for ENI purposes.

24

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Unless we state otherwise or the context otherwise requires, references in this Quarterly Report on Form 10-Q to the “Company”, “BrightSphere” or “BSIG” refer to BrightSphere Investment Group Inc., and references to “we,” “our” and “us” refer to BSIG and its consolidated subsidiaries, excluding discontinued operations. References to the holding company or “Center” excluding the Affiliates refer to BrightSphere Inc., or “BSUS,” a Delaware corporation and wholly owned subsidiary of BSIG. Unless we state otherwise or the context otherwise requires, references in this Quarterly Report on Form 10-Q to “Affiliates” or an “Affiliate” refer to the asset management firms in which we have or had an ownership interest. References in this Quarterly Report on Form 10-Q to “OM plc” refer to Old Mutual plc, our former parent. None of the information in this Quarterly Report on Form 10-Q constitutes either an offer or a solicitation to buy or sell any of our Affiliate’s products or services, nor is any such information a recommendation for any of our Affiliate’s products or services.

The following discussion of our financial condition and results of operations should be read in conjunction with our Condensed Consolidated Financial Statements and related notes which appear elsewhere in this Quarterly Report on Form 10-Q.

This discussion contains forward-looking statements that involve risks and uncertainties. See “Forward-Looking Statements” at the end of this Item 2 for more information. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those discussed below.

This Management’s Discussion and Analysis of Financial Condition and Results of Operations, or MD&A, is designed to provide a reader of our financial statements with a narrative from the perspective of our management on our financial condition, results of operations, liquidity and certain other factors that may affect our future results.

Our MD&A is presented in five sections:

•Overview provides a brief description of our business. It includes information on our reporting segment and underlying Affiliate, a summary of The Economics of Our Business and an explanation of How We Measure Performance using a non-GAAP measure which we refer to as economic net income, or ENI. This section also provides a Summary Results of Operations and information regarding our Assets Under Management by strategy, client type and location, and net flows by segment, client type and client location.

•U.S. GAAP Results of Operations for the Three Months Ended March 31, 2023 and 2022 includes an explanation of changes in our U.S. GAAP revenue, expense and other items for the three months ended March 31, 2023 and 2022, as well as key U.S. GAAP operating metrics.

•Non-GAAP Supplemental Performance Measure — Economic Net Income and Segment Analysis includes an explanation of the key differences between U.S. GAAP net income and ENI, the key measure management uses to evaluate our performance. This section also provides a reconciliation between U.S. GAAP net income attributable to controlling interests and ENI for the three months ended March 31, 2023 and 2022, as well as a reconciliation of key ENI operating items including ENI revenue and ENI operating expenses. This section also provides key non-GAAP operating metrics. In addition, this section provides segment analysis for our business segment.

•Capital Resources and Liquidity discusses our key balance sheet data. This section discusses Cash Flows from the business; Adjusted EBITDA; Future Capital Needs; Borrowings and Long-Term Debt. The discussion of Adjusted EBITDA includes an explanation of how we calculate Adjusted EBITDA and a reconciliation of U.S. GAAP net income attributable to controlling interests to Adjusted EBITDA.

•Critical Accounting Policies and Estimates provides a discussion of the key accounting policies and estimates that we believe are the most critical to an understanding of our results of operations and financial condition. These accounting policies and estimates require complex management judgment regarding matters that are highly uncertain at the time the policies were applied and estimates were made.

25

Overview

We are a global asset management holding company headquartered in Boston, Massachusetts. We historically held interests in a group of investment management firms (the “Affiliates”) individually headquartered in the United States. We have completed the disposition of certain Affiliates and currently operate our business through the following segment:

•Quant & Solutions—comprised of versatile, often highly-tailored strategies that leverage data and technology in a computational, factor-based investment process across a range of asset classes in developed and emerging markets, including global, non-U.S. and small-cap equities, as well as managed volatility, ESG, multi-asset, equity alternatives, and long/short strategies. This segment is comprised of our interest in our sole Affiliate, Acadian Asset Management LLC (“Acadian”).

Through Acadian, we offer a diverse range of actively-managed investment strategies and products to institutional investors around the globe.

The corporate head office is included within the Other category. The corporate head office expenses are not allocated to the Company’s business segment but the Chief Operating Decision Maker (“CODM”) does consider the cost structure of the corporate head office when evaluating the financial performance of our segment.

Under U.S. GAAP, Acadian is consolidated into our financial statements. We may also be required to consolidate Acadian’s sponsored investment entities, or Funds, due to the nature of our decision-making rights, our economic interests in these Funds or the rights of third party clients in those Funds.

    The Economics of Our Business

Our profitability is affected by a variety of factors including the level and composition of our average assets under management, or AUM, fee rates charged on AUM and our expense structure. We earn management fees based on assets under management. Approximately 80% of our management fees for the three months ended March 31, 2023 were calculated based on average AUM (calculated on either a daily or monthly basis) with the remainder of our management fees calculated based on period-end AUM. Changes in the levels of our AUM are driven by market investment performance and net client cash flows. We may also earn performance fees, or adjust management fees, when certain accounts differ in relation to relevant benchmarks or exceed or fail to exceed required returns. Approximately $13 billion, or 13%, of our AUM are in accounts with incentive fee features in which we participate in the performance fee. The majority of these performance fees are calculated based on value added over the relevant benchmarks on a rolling one-year basis.

Our largest expense item is compensation and benefits paid to our employees, which consists of both fixed and variable components. Fixed compensation and benefits represents base salaries and wages, payroll taxes and the costs of our employee benefit programs. Variable compensation, calculated as described below, may be awarded in cash, equity, or profit interests.

The arrangements in place with Acadian result in the sharing of economics between BSUS and Acadian’s key management personnel using a profit-sharing model. Profit sharing affects two elements within our earnings: (i) the calculation of variable compensation and (ii) the level of equity or profit interests distribution to our employees.

Variable compensation is the portion of earnings that is contractually allocated to Acadian employees as a bonus pool, typically representing a fixed percentage of earnings before variable compensation, which is measured as revenues less fixed compensation and benefits and other operating and administrative expenses. Profits after variable compensation are shared between us and Acadian key employee equity holders according to our respective equity or profit interests ownership. The sharing of profits in this manner ensures that the economic interests of Acadian key employees and those of BSUS are aligned, both in terms of generating strong annual earnings as well as investing those earnings back into the business in order to generate growth over the long term. We view profit sharing as an attractive operating model, as it allows us to share in the benefits of operating leverage as the business grows, and ensures all equity and profit interests holders are incentivized to achieve that growth.

26

Equity or profit interests owned by Acadian key employees are awarded as part of their variable compensation arrangements. Over time, key employee-owned equity or profit interests are recycled from one generation of employee-owners to the next, either by the next generation purchasing equity or profit interests directly from retiring principals, or by key employees forgoing cash bonuses in exchange for the equivalent value in Acadian equity or profit interests. The recycling of equity or profit interests is often facilitated by BSUS; see “—U.S. GAAP Results of Operations—U.S. GAAP Expenses—Compensation and Benefits Expense” for a further discussion.

How We Measure Performance

We manage our business based on one segment, reflecting how our management assesses the performance of our business.

In measuring and monitoring the key components of our earnings, our management uses a non-GAAP financial measure, ENI, to evaluate the financial performance of, and to make operational decisions for, our business. We also use ENI to make resource allocation decisions, determine appropriate levels of investment or dividend payout, manage balance sheet leverage, determine variable compensation and equity distributions, and incentivize management. It is an important measure in evaluating our financial performance because we believe it most accurately represents our operating performance and cash generation capability.

ENI differs from net income determined in accordance with U.S. GAAP as a result of both the reclassification of certain income statement items and the exclusion of certain non-cash or non-recurring income statement items. In particular, ENI excludes non-cash charges representing the changes in the value of Affiliate equity and profit interests held by Affiliate key employees, the results of discontinued operations which are no longer part of our business, restructuring costs, capital transaction costs, seed capital and co-investment gains, losses and related financing costs and that portion of consolidated Funds which are not attributable to our stockholders.

ENI revenue is primarily comprised of the fee revenues paid to us by our clients for our advisory services and earnings from our equity-accounted Affiliate. Revenue included within ENI differs from U.S. GAAP revenue in that it excludes amounts from consolidated Funds which are not attributable to our stockholders and it includes our share of earnings from our equity-accounted Affiliate.

ENI expenses are calculated to reflect all usual expenses from ongoing continuing operations attributable to our stockholders. Expenses included within ENI differ from U.S. GAAP expenses in that they exclude amounts from consolidated Funds which are not attributable to our stockholders, revaluations of Affiliate key employee owned equity and profit interests, amortization and impairment of acquired intangibles and other acquisition-related items, and certain other non-cash expenses.

“Non-controlling interests” is a concept under U.S. GAAP that identifies net components of revenues and expenses that are not attributable to our stockholders. For example, the portion of the net income (loss) of any consolidated Fund that is attributable to the outside investors or clients of the consolidated Fund is included in “Non-controlling interests” in our Condensed Consolidated Financial Statements. Conversely, “controlling interests” is the portion of revenue or expense that is attributable to our stockholders.

For a more detailed discussion of the differences between U.S. GAAP net income and economic net income, see “—Non-GAAP Supplemental Performance Measure — Economic Net Income and Segment Analysis.”

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Summary Results of Operations

The following table summarizes our unaudited results of operations for the three months ended March 31, 2023 and 2022: 

($ in millions, unless otherwise noted)	Three Months Ended March 31,
	2023			2022			2023 vs. 2022
U.S. GAAP Basis
Revenue	$	91.8		$	112.2		$	(20.4)
Pre-tax income attributable to controlling interests	17.1			33.4			(16.3)
Net income attributable to controlling interests	12.0			23.8			(11.8)
U.S. GAAP operating margin(1)	21.6		%	38.5		%	(1693) bps
Earnings per share, basic ($)	$	0.29		$	0.54		$	(0.25)
Earnings per share, diluted ($)	$	0.28		$	0.53		$	(0.25)
Basic shares outstanding (in millions)	41.4			44.0			(2.6)
Diluted shares outstanding (in millions)	42.7			45.3			(2.6)
Economic Net Income Basis(2)(3)
(Non-GAAP measure used by management)
ENI revenue(4)	$	91.1		$	112.2		$	(21.1)
Pre-tax economic net income(5)	16.2			32.2			(16.0)
Adjusted EBITDA	23.6			43.0			(19.4)
ENI operating margin(6)	22.8		%	34.5		%	(1166) bps
Economic net income(7)	11.8			23.4			(11.6)
ENI diluted EPS ($)	$	0.28		$	0.52		$	(0.24)
Other Operational Information
Assets under management (AUM) at period end (in billions)	$	97.5		$	110.2		$	(12.7)
Net client cash flows (in billions)	0.1			(2.2)			2.3
Annualized revenue impact of net flows(8)	1.0			(1.1)			2.1

(1)U.S. GAAP operating margin equals operating income divided by total revenue.

(2)Economic net income is a non-GAAP measure we use to evaluate the performance of our business. For a reconciliation to U.S. GAAP financial information and a further discussion of economic net income refer to “—Non-GAAP Supplemental Performance Measure—Economic Net Income and Segment Analysis.”

(3)Excludes costs associated with the transfer of an insurance policy from our former Parent of $0.4 million for the three months ended March 31, 2023. Excludes restructuring costs at Acadian of $0.1 million and costs associated with the transfer of an insurance policy from our former Parent of $0.3 million for the three months ended March 31, 2022.

(4)ENI revenue is the ENI measure which corresponds to U.S. GAAP revenue.

(5)Pre-tax economic net income is the ENI measure which corresponds to U.S. GAAP pre-tax income attributable to controlling interests.

(6)ENI operating margin is a non-GAAP efficiency measure, calculated based on ENI operating earnings divided by ENI revenue. ENI operating earnings is calculated as ENI revenue, less ENI operating expense, less ENI variable compensation. The ENI operating margin corresponds to our U.S. GAAP operating margin (excluding the effect of consolidated Funds).

(7)Economic net income is the ENI measure which is most directly comparable to U.S. GAAP net income attributable to controlling interests.

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(8)Annualized revenue impact of net flows represents annualized management fees expected to be earned on new accounts and net assets contributed to existing accounts, less the annualized management fees lost on terminated accounts or net assets withdrawn from existing accounts, plus revenue impact from reinvested income and distribution. The annualized management fees are calculated by multiplying the annual gross fee rate for the relevant account by the net assets gained in the account in the event of a positive flow, excluding any current or future market appreciation or depreciation, or the net assets lost in the account in the event of an outflow, excluding any current or future market appreciation or depreciation. In addition, reinvested income and distribution for the segment is multiplied by average fee rate for the segment to compute the revenue impact. For a further discussion of the uses and limitations of the annualized revenue impact of net flows, see “Assets Under Management” herein.

Assets Under Management

The following table presents our assets under management as of each of the dates indicated: 

($ in billions)	March 31, 2023		December 31, 2022
Acadian Asset Management	$	97.5	$	93.6

Our strategies include:

i.Developed Markets equity, which includes Quant & Solutions U.S., global and international equities; and

ii.Emerging Markets equity, which includes Quant & Solutions equity investments in the emerging and frontier markets.

The following table presents our assets under management by strategy as of each of the dates indicated: 

($ in billions)	March 31, 2023		December 31, 2022
Developed Markets	76.0		73.2
Emerging Markets	21.5		20.4
Total assets under management	$	97.5	$	93.6

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The following table shows assets under management by client type as of each of the dates indicated:

($ in billions)	March 31, 2023				December 31, 2022
	AUM		% of total		AUM		% of total
Public/Government	$	41.2	42.3	%	$	39.3	42.0	%
Commingled Trust/UCITS	22.7		23.3	%	21.7		23.2	%
Corporate/Union	13.7		14.1	%	13.1		14.0	%
Sub-advisory	11.9		12.2	%	11.8		12.6	%
Endowment/Foundation	3.2		3.3	%	3.1		3.3	%
Mutual Fund	0.7		0.7	%	0.6		0.6	%
Other	4.1		4.1	%	4.0		4.3	%
Total assets under management	$	97.5			$	93.6

The following table shows assets under management by client location as of each of the dates indicated:

($ in billions)	March 31, 2023				December 31, 2022
	AUM		% of total		AUM		% of total
U.S.	$	65.0	66.7	%	$	62.7	67.0	%
Europe	16.9		17.3	%	16.3		17.4	%
Asia	3.9		4.0	%	3.2		3.4	%
Australia	5.8		5.9	%	5.6		6.0	%
Other	5.9		6.1	%	5.8		6.2	%
Total assets under management	$	97.5			$	93.6

AUM flows and the annualized revenue impact of net flows

Net client cash flows and revenue impact of net client cash flows for all periods include reinvested income and distributions. Reinvested income and distributions represent investment yield that is reinvested back into the portfolios as opposed to distributed as cash.

In the following table, we present our asset flows and market appreciation (depreciation) by segment. We also present a key metric used to better understand our asset flows, the annualized revenue impact of net client cash flows. Annualized revenue impact of net flows represents annualized management fees expected to be earned on new accounts and net assets contributed to existing accounts (inflows), less the annualized management fees lost on terminated accounts or net assets withdrawn from existing accounts (outflows), plus revenue impact from reinvested income and distributions. Annualized management fee for client flow is calculated by multiplying the annual gross fee rate for the relevant account with the inflow or the outflow. In addition, reinvested income and distributions is multiplied by the average fee rate to compute the revenue impact.

The annualized revenue impact of net flows metric is designed to provide investors with a better indication of the potential financial impact of net client cash flows, however it has certain limitations. For instance, it does not include assumptions for the next twelve months' market appreciation or depreciation and investment performance associated with the assets gained or lost. Nor does it account for factors such as future client terminations or additional contributions or withdrawals over the next twelve months. Additionally, the basis points reported are fee rates based on the asset levels at the time of the transactions and do not consider the fact that client fee rates may change over the next twelve months.

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The following table summarizes our asset flows and market appreciation (depreciation) by segment for each of the periods indicated:

	Three Months Ended March 31,
($ in billions, unless otherwise noted)	2023		2022
Quant & Solutions
Beginning balance	$	93.6	$	117.2
Gross inflows	2.2		3.5
Gross outflows	(3.0)		(6.6)
Reinvested income and distributions	0.9		0.9
Net flows	0.1		(2.2)
Market appreciation (depreciation)	3.8		(4.8)
Ending balance	$	97.5	$	110.2
Average AUM	$	96.4	$	111.3
Annualized basis points: inflows	41.3		50.3
Annualized basis points: outflows	38.9		33.4
Annualized revenue impact of net flows ($ in millions)	$	1.0	$	(1.1)

We also analyze our asset flows by client type and client location. Our client types include:

i.Sub-advisory, which includes assets managed for underlying mutual fund and variable insurance products which are sponsored by insurance companies and mutual fund platforms, where the end client is typically retail;

ii.Institutional, which includes assets managed for public/government pension funds, including U.S. state and local government funds and non-U.S. sovereign wealth, local government and national pension funds; also includes corporate and union-sponsored pension plans; and

iii.Retail/other, which includes assets managed for mutual funds sponsored by our Affiliate, defined contribution plans and accounts managed for high net worth clients.

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The following table summarizes our asset flows by client type for each of the periods indicated: 

($ in billions)	Three Months Ended March 31,
	2023		2022
Sub-advisory
Beginning balance	$	11.8	$	14.1
Gross inflows	0.4		0.5
Gross outflows	(0.7)		(0.4)
Reinvested income and distributions	0.1		0.1
Net flows	(0.2)		0.2
Market appreciation (depreciation)	0.3		(0.6)
Ending balance	$	11.9	$	13.7
Institutional
Beginning balance	$	77.2	$	97.8
Gross inflows	1.7		2.6
Gross outflows	(2.2)		(5.9)
Reinvested income and distributions	0.7		0.8
Net flows	0.2		(2.5)
Market appreciation (depreciation)	3.4		(4.0)
Ending balance	$	80.8	$	91.3
Retail/Other
Beginning balance	$	4.6	$	5.3
Gross inflows	0.1		0.4
Gross outflows	(0.1)		(0.3)
Reinvested income and distributions	0.1		—
Net flows	0.1		0.1
Market appreciation (depreciation)	0.1		(0.2)
Ending balance	$	4.8	$	5.2
Total
Beginning balance	$	93.6	$	117.2
Gross inflows	2.2		3.5
Gross outflows	(3.0)		(6.6)
Reinvested income and distributions	0.9		0.9
Net flows	0.1		(2.2)
Market appreciation (depreciation)	3.8		(4.8)
Ending balance	97.5		110.2

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Our categorization by client location includes:

i. U.S.-based clients, where the contracting client is based in the United States, and

ii. Non-U.S.-based clients, where the contracting client is based outside the United States.

The following table summarizes asset flows by client location for each of the periods indicated:

($ in billions)	Three Months Ended March 31,
	2023		2022
U.S.
Beginning balance	$	62.7	$	77.1
Gross inflows	1.2		2.4
Gross outflows	(2.1)		(2.3)
Reinvested income and distributions	0.6		0.6
Net flows	(0.3)		0.7
Market appreciation (depreciation)	2.6		(2.9)
Ending balance	$	65.0	$	74.9
Non-U.S.
Beginning balance	$	30.9	$	40.1
Gross inflows	1.0		1.1
Gross outflows	(0.9)		(4.3)
Reinvested income and distributions	0.3		0.3
Net flows	0.4		(2.9)
Market appreciation (depreciation)	1.2		(1.9)
Ending balance	$	32.5	$	35.3
Total
Beginning balance	$	93.6	$	117.2
Gross inflows	2.2		3.5
Gross outflows	(3.0)		(6.6)
Reinvested income and distributions	0.9		0.9
Net flows	0.1		(2.2)
Market appreciation (depreciation)	3.8		(4.8)
Ending balance	$	97.5	$	110.2

At March 31, 2023, our total assets under management were $97.5 billion, an increase of $3.9 billion, or 4.2%, compared to $93.6 billion at December 31, 2022 and a decrease of $(12.7) billion, or (11.5)%, compared to $110.2 billion at March 31, 2022. The decrease in assets under management compared to March 31, 2022 is a result of equity market and currency depreciation, and net outflows in the last twelve months. The change in assets under management during the three months ended March 31, 2023 reflects net market appreciation of $3.8 billion. Market appreciation or depreciation reported in current and prior periods includes changes in equity prices, as well as the impact from exchange rate fluctuations on our foreign-denominated AUM. Given a substantial portion of our AUM is denominated in foreign currencies, foreign exchange rate movements during the period can impact AUM when the strength of the U.S. dollar changes relative to other currencies.

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For the three months ended March 31, 2023, our net flows were $0.1 billion compared to $(2.2) billion for the three months ended March 31, 2022. The change in net flows during the three months ended March 31, 2023 compared to the three months ended March 31, 2022 was primarily driven by lower outflows in the three months ended March 31, 2023. Reinvested income and distributions of $0.9 billion and $0.9 billion are reflected in the net flows for the three months ended March 31, 2023 and March 31, 2022, respectively. For the three months ended March 31, 2023, the annualized revenue impact of the net flows was $1.0 million compared to $(1.1) million for the three months ended March 31, 2022. Gross inflows of $2.2 billion in the three months ended March 31, 2023 yielded approximately 41 bps compared to $3.5 billion yielding approximately 50 bps in the year-ago period. Gross outflows of $(3.0) billion yielded approximately 39 bps in the three months ended March 31, 2023 compared to $(6.6) billion yielding approximately 33 bps in the year-ago period.

U.S. GAAP Results of Operations for the Three Months Ended March 31, 2023 and 2022

Our U.S. GAAP results of operations were as follows for the three months ended March 31, 2023 and 2022: 

	Three Months Ended March 31,
($ in millions, unless otherwise noted)	2023			2022			Increase (Decrease)
U.S. GAAP Statement of Operations
Management fees	$	90.6		$	102.2		$	(11.6)
Performance fees	0.5			10.0			(9.5)
Consolidated Funds’ revenue	0.7			—			0.7
Total revenue	91.8			112.2			(20.4)
Compensation and benefits	49.1			46.8			2.3
General and administrative expense	18.4			16.9			1.5
Depreciation and amortization	3.8			5.3			(1.5)
Consolidated Funds’ expense	0.7			—			0.7
Total operating expenses	72.0			69.0			3.0
Operating income	19.8			43.2			(23.4)
Investment income (loss)	0.3			(0.1)			0.4
Interest income	1.1			—			1.1
Interest expense	(4.9)			(6.5)			1.6
Loss on extinguishment of debt	—			(3.2)			3.2
Net consolidated Funds’ investment gains	0.8			—			0.8
Income before income taxes	17.1			33.4			(16.3)
Income tax expense	5.1			9.6			(4.5)
Net income	12.0			23.8			(11.8)
Net income (loss) attributable to non-controlling interests in consolidated Funds	—			—			—
Net income attributable to controlling interests	$	12.0		$	23.8		$	(11.8)
Basic earnings per share ($)	$	0.29		$	0.54		$	(0.25)
Diluted earnings per share ($)	0.28			0.53			(0.25)
Weighted average shares of common stock outstanding—basic	41.4			44.0			(2.6)
Weighted average shares of common stock outstanding—diluted	42.7			45.3			(2.6)
U.S. GAAP operating margin(1)	21.6		%	38.5		%

(1) The U.S. GAAP operating margin equals operating income divided by total revenue.

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The following table reconciles our net income attributable to controlling interests to our pre-tax income attributable to controlling interests: 

($ in millions)	Three Months Ended March 31,
U.S. GAAP Statement of Operations	2023		2022
Net income attributable to controlling interests	$	12.0	$	23.8
Add: Income tax expense	5.1		9.6
Pre-tax income attributable to controlling interests	$	17.1	$	33.4

U.S. GAAP Revenues

Our U.S. GAAP revenues principally consist of:

i.management fees earned based on our overall weighted average fee rate charged to our clients and the level of assets under management;

ii.performance fees earned when our Affiliate’s investment performance over agreed time periods for certain clients has differed from pre-determined hurdles; and

iii.revenue from consolidated Funds, a portion of which is attributable to the holders of non-controlling interests in Consolidated Funds.

Management Fees

Our management fees are a function of the fee rates charged to our clients, which are typically expressed in basis points, and the levels of our assets under management.

Average basis points earned on average assets under management were 38.1 bps for the three months ended March 31, 2023, and 37.3 bps for the three months ended March 31, 2022, respectively. The overall weighted average fee rate increase for the three months ended March 31, 2023 is the result of changes in the mix of assets under management caused by market movements and client flows.

Three months ended March 31, 2023 compared to three months ended March 31, 2022: Management fees decreased $(11.6) million, or (11.4)%, from $102.2 million for the three months ended March 31, 2022 to $90.6 million for the three months ended March 31, 2023. The decrease was primarily attributable to the equity market decline and net outflows over the past twelve months. Average assets under management decreased (13)%, from $111.3 billion for the three months ended March 31, 2022 to $96.4 billion for the three months ended March 31, 2023, mainly due to the equity market decline and net outflows over the past twelve months.

Performance Fees

Approximately $12.7 billion, or 13% of our AUM, were in accounts with performance fee features in which we participate. Performance fees are typically shared with our Affiliate key employees through various contractual compensation and profit-sharing arrangements.

Three months ended March 31, 2023 compared to three months ended March 31, 2022: Performance fees decreased $(9.5) million, from $10.0 million for the three months ended March 31, 2022 to $0.5 million for the three months ended March 31, 2023. Performance fees are variable and are contractually triggered based on investment performance results over agreed upon time periods.

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U.S. GAAP Expenses

Our U.S. GAAP expenses principally consist of:

i.compensation paid to our investment professionals and other employees, including base salary, benefits, sales-based compensation, variable compensation, Affiliate distributions, and revaluation of key employee owned Affiliate equity and profit interests;

ii.general and administrative expenses;

iii.depreciation and amortization charges; and

iv.expenses of consolidated Funds, a portion of which is attributable to the holders of non-controlling interests in consolidated Funds.

Compensation and Benefits Expense

Our most significant category of expense is compensation and benefits awarded to our and our Affiliate’s employees. The following table presents the components of U.S. GAAP compensation expense for the three months ended March 31, 2023 and 2022:

	Three Months Ended March 31,
($ in millions)	2023		2022
Fixed compensation and benefits(1)	$	23.4	$	21.9
Sales-based compensation(2)	1.9		1.9
Variable compensation(3)	23.2		27.9
Affiliate key employee distributions(4)	1.2		1.9
Non-cash Affiliate key employee equity revaluations(5)	(0.6)		(6.8)
Total U.S. GAAP compensation and benefits expense	$	49.1	$	46.8

(1)Fixed compensation and benefits includes base salaries, payroll taxes and the cost of benefit programs provided. For the three months ended March 31, 2023 and 2022, $23.4 million and $21.9 million, respectively, of fixed compensation and benefits (of the $23.4 million and $21.9 million above) are included within economic net income.

(2)Sales-based compensation is paid to our Affiliate’s sales and distribution teams and represents compensation earned by our sales professionals, paid over a multi-year period, related to revenue earned on new sales. Its variability is based upon the structure of sales-based compensation due on inflows of assets under management and market-based movement in both current and prior periods.

(3)Variable compensation is contractually set and calculated individually for our Affiliate, plus Center bonuses. Variable compensation is awarded based on a contractual percentage of Affiliate ENI profits before variable compensation and may be paid in the form of cash or non-cash Affiliate equity or profit interests. With our Affiliate, we have a contractual split of performance fees between Affiliate employees and BSUS. The Affiliate’s share of performance fees, which ranges from 60%-75% of the total, is allocated entirely to variable compensation. The variable compensation earned on performance fees vests over three-years and compensation is recognized over that service period. Center variable compensation includes cash and our equity. Non-cash variable compensation awards typically vest over several years and are recognized as compensation expense over that service period.

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	Three Months Ended March 31,
($ in millions)	2023		2022
Cash variable compensation	$	21.6	$	25.3
Non-cash equity-based award amortization	1.6		2.6
Total variable compensation(a)	$	23.2	$	27.9

(a)For the three months ended March 31, 2023, $23.2 million of variable compensation expense (of the $23.2 million above) is included within economic net income. For the three months ended March 31, 2022, $27.9 million of variable compensation expense (of the $27.9 million above) is included within economic net income.

(4)Affiliate key employee distributions represent the share of Affiliate profits after variable compensation that is attributable to Affiliate key employee equity and profit interests holders, according to their ownership interests. The Affiliate key employee distribution ratio at our Affiliate is calculated as Affiliate key employee distributions divided by ENI operating earnings at the Affiliate. Within our Affiliate we have a tiered equity structure, where BSUS and other classes of employee equity holders are entitled to an initial proportionate preference over profits after variable compensation, structured such that before a preference threshold is reached, there would be no required key employee distributions to the tiered equity holders, whereas for profits above the threshold, the key employee distribution amount to the tiered equity holders would be calculated based on the tiered key employee ownership percentages.

(5)Non-cash Affiliate key employee equity revaluations represent changes in the value of Affiliate equity and profit interests held by Affiliate key employees. These ownership interests may in certain circumstances be repurchased by BSUS at a value based on a pre-determined fixed multiple of twelve-month earnings and as such a liability is carried on our balance sheet based on the expected cash to be paid. However, any equity or profit interests repurchased by BSUS can be used to fund a portion of future variable compensation awards, resulting in savings in cash variable compensation that offset the negative cash effect of repurchasing the equity. Our Affiliate equity and profit interest plans have been designed to ensure BSUS is not required to repurchase more equity than we can reasonably recycle through variable compensation awards in any given twelve-month period.

Fluctuations in compensation and benefits expense for the periods presented are discussed below.

Three months ended March 31, 2023 compared to three months ended March 31, 2022: Compensation and benefits expense increased $2.3 million, or 4.9%, from $46.8 million for the three months ended March 31, 2022 to $49.1 million for the three months ended March 31, 2023. Fixed compensation and benefits increased $1.5 million, or 6.8%, from $21.9 million for the three months ended March 31, 2022 to $23.4 million for the three months ended March 31, 2023, primarily reflecting cost of living increases and the cost of new hires supporting our growth initiatives. Variable compensation decreased $(4.7) million, or (16.8)%, from $27.9 million for the three months ended March 31, 2022 to $23.2 million for the three months ended March 31, 2023. The decrease was primarily attributable to lower pre-bonus profits in the current year. This decrease was partially offset by the inclusion of deferred compensation expense earned on prior year performance fee revenues, of which the Affiliate’s share is determined by a contractual split and recognized as compensation expense over a vesting period. Sales-based compensation remained at $1.9 million for the three months ended March 31, 2023 and 2022. Affiliate key employee distributions decreased $(0.7) million, or (36.8)%, from $1.9 million for the three months ended March 31, 2022 to $1.2 million for the three months ended March 31, 2023, primarily as a result of lower underlying operating earnings at the consolidated Affiliate. Revaluations of Affiliate equity changed $6.2 million reflecting the change in value of key employee ownership interests at our consolidated Affiliate, as the value of Affiliate equity decreased $(6.8) million for the three months ended March 31, 2022 and decreased $(0.6) million for the three months ended March 31, 2023.

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General and Administrative Expense

Three months ended March 31, 2023 compared to three months ended March 31, 2022: General and administrative expense increased $1.5 million, or 8.9%, from $16.9 million for the three months ended March 31, 2022 to $18.4 million for the three months ended March 31, 2023. The increase was primarily due to an increase in travel and entertainment, consulting, and system costs in the current period.

Depreciation and Amortization Expense

Three months ended March 31, 2023 compared to three months ended March 31, 2022: Depreciation and amortization expense decreased $(1.5) million, or (28.3)%, from $5.3 million for the three months ended March 31, 2022 to $3.8 million for the three months ended March 31, 2023. The decrease was primarily attributable to the effect of certain assets becoming fully depreciated.

U.S. GAAP Other Non-Operating Items of Income and Expense

Other non-operating items of income and expense consist of:

i.investment income;

ii.interest expense; and

iii.loss on extinguishment of debt.

Investment Income

Three months ended March 31, 2023 compared to three months ended March 31, 2022: Investment income increased $0.4 million, from $(0.1) million for the three months ended March 31, 2022 to $0.3 million for the three months ended March 31, 2023. The increase was driven primarily by higher returns on seed capital investments due to market appreciation in the three months ended March 31, 2023.

Interest Income

Three months ended March 31, 2023 compared to three months ended March 31, 2022: Interest income increased $1.1 million, from $0.0 million for the three months ended March 31, 2022 compared to $1.1 million for the three months ended March 31, 2023. The increase was due to an increase in short-term investment returns.

Interest Expense

Three months ended March 31, 2023 compared to three months ended March 31, 2022: Interest expense decreased $(1.6) million, or (24.6)%, from $6.5 million for the three months ended March 31, 2022 to $4.9 million for the three months ended March 31, 2023, primarily due to the $1.3 million of additional interest expense incurred for the three months ended March 31, 2022 related to the amortization of the cash flow hedge associated with the $125 million aggregate principal amount outstanding of our 5.125% Senior Notes due August 1, 2031 that we redeemed in January 2022.

Loss on Extinguishment of Debt

Three months ended March 31, 2023 compared to three months ended March 31, 2022: There was $(3.2) million loss on extinguishment of debt in the three months ended March 31, 2022 as a result of the full redemption of the $125 million aggregate principal amount outstanding of our 5.125% Senior Notes due August 1, 2031 that we redeemed in January 2022. There was no loss on extinguishment of debt incurred for the three months ended March 31, 2023.

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U.S. GAAP Income Tax Expense (Benefit)

Our effective tax rate has been impacted by changes in liabilities for uncertain tax positions, tax effects of stock-based compensation, limitations on executive compensation, and the mix of income earned in the United States versus foreign jurisdictions. Our effective tax rate could be impacted in the future by these items as well as further changes in tax laws and regulations in jurisdictions in which we operate.

Three months ended March 31, 2023 compared to three months ended March 31, 2022: Income tax expense decreased $(4.5) million, from $9.6 million for the three months ended March 31, 2022 to $5.1 million for the three months ended March 31, 2023. The decrease in income tax expense primarily relates to a decrease in income before income taxes during the three months ended March 31, 2023.

U.S. GAAP Consolidated Funds

The net income or loss of all consolidated Funds, excluding any income or loss attributable to seed capital or co-investments we make in the Funds, is included in non-controlling interests in our Consolidated Financial Statements and is not included in net income attributable to controlling interests or in management fees.

Three months ended March 31, 2023 compared to three months ended March 31, 2022: There were no consolidated Funds for the three months ended March 31, 2022. Consolidated Funds’ revenue was $0.7 million for the three months ended March 31, 2023. Consolidated Funds’ expense was $0.7 million for the three months ended March 31, 2023.

Key U.S. GAAP Operating Metrics

The following table shows our key U.S. GAAP operating metrics for the three months ended March 31, 2023 and 2022.

	Three Months Ended March 31,
($ in millions)	2023			2022
Numerator: Operating income	$	19.8		$	43.2
Denominator: Total revenue	$	91.8		$	112.2
U.S. GAAP operating margin(1)	21.6		%	38.5		%
Numerator: Total operating expenses(2)	$	71.3		$	69.0
Denominator: Management fee revenue	$	90.6		$	102.2
U.S. GAAP operating expense / management fee revenue(3)	78.7		%	67.5		%
Numerator: Variable compensation	$	23.2		$	27.9
Denominator: Operating income before variable compensation and Affiliate key employee distributions(2)(4)(5)	$	44.2		$	73.0
U.S. GAAP variable compensation ratio(3)	52.5		%	38.2		%
Numerator: Affiliate key employee distributions	$	1.2		$	1.9
Denominator: Operating income before Affiliate key employee distributions(2)(4)(5)	$	21.0		$	45.1
U.S. GAAP Affiliate key employee distributions ratio(3)	5.7		%	4.2		%

(1)Excluding the effect of Funds’ consolidation in the applicable periods, the U.S. GAAP operating margin would be 21.7% for the three months ended March 31, 2023 and 38.5% for the three months ended March 31, 2022.

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(2)Excludes consolidated Funds’ expense of $0.7 million for the three months ended March 31, 2023 and $0.0 million for the three months ended March 31, 2022.

(3)Excludes the effect of Funds consolidation for the three months ended March 31, 2023 and 2022.

(4)Excludes consolidated Funds’ revenue of $0.7 million for the three months ended March 31, 2023 and $0.0 million for the three months ended March 31, 2022.

(5)The following table identifies the components of operating income before variable compensation and Affiliate key employee distributions, as well as operating income before Affiliate key employee distributions:

	Three Months Ended March 31,
($ in millions)	2023		2022
Operating income	$	19.8	$	43.2
Affiliate key employee distributions	1.2		1.9
Operating income before Affiliate key employee distributions	21.0		45.1
Variable compensation	23.2		27.9
Operating income before variable compensation and Affiliate key employee distributions	$	44.2	$	73.0

Non-GAAP Supplemental Performance Measure — Economic Net Income and Segment Analysis

As supplemental information, we provide a non-GAAP performance measure that we refer to as economic net income, or ENI, which represents our management’s view of the underlying economic earnings generated by us. We define economic net income as ENI revenue less (i) ENI operating expenses, (ii) variable compensation, (iii) key employee distributions, (iv) net interest and (v) taxes, each as further discussed in this section. ENI adjustments to U.S. GAAP include both reclassifications of U.S. GAAP revenue and expense items, as well as adjustments to U.S. GAAP results, primarily to exclude non-cash, non-economic expenses, or to reflect cash benefits not recognized under U.S. GAAP.

ENI is an important measure to investors because it is used by us to make resource allocation decisions, determine appropriate levels of investment or dividend payout, manage balance sheet leverage, determine Affiliate variable compensation and equity distributions, and incentivize management. It is also an important measure because it assists management in evaluating our operating performance and is presented in a way that most closely reflects the key elements of our profit share operating model with our Affiliates. For a further discussion of how we use ENI and why ENI is useful to investors, see “—Overview—How We Measure Performance.”

To calculate economic net income, we re-categorize certain line items on our Condensed Consolidated Statements of Operations to reflect the following:

•We exclude the effect of Funds consolidation by removing the portion of Fund revenues, expenses and investment return which were not attributable to our stockholders.

•We include within management fee revenue any fees paid to Affiliates by consolidated Funds, which are viewed as investment income under U.S. GAAP.

•We include our share of earnings from our equity-accounted Affiliate within other income in ENI revenue, rather than investment income.

•We treat sales-based compensation as a general and administrative expense, rather than part of fixed compensation and benefits.

•We identify separately from operating expenses variable compensation and Affiliate key employee distributions, which represent Affiliate earnings shared with Affiliate key employees.

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We also make the following adjustments to U.S. GAAP results to more closely reflect our economic results:

i.We exclude non-cash expenses representing changes in the value of Affiliate equity and profit interests held by Affiliate key employees. These ownership interests may in certain circumstances be repurchased by BSUS at a value based on a pre-determined fixed multiple of trailing earnings and as such this value is carried on our balance sheet as a liability. Non-cash movements in the value of this liability are treated as compensation expense under U.S. GAAP. However, any equity or profit interests repurchased by BSUS can be used to fund a portion of future variable compensation awards, resulting in savings in cash variable compensation that offset the negative cash effect of repurchasing the equity. Our Affiliate equity and profit interest plans have been designed to ensure BSUS is never required to repurchase more equity than we can reasonably recycle through variable compensation awards in any given twelve-month period.

ii.We exclude non-cash amortization or impairment expenses related to acquired goodwill and other intangibles as these are non-cash charges that do not result in an outflow of tangible economic benefits from the business.

iii.We exclude capital transaction costs, including the costs of raising debt or equity, gains or losses realized as a result of redeeming debt or equity and direct incremental costs associated with acquisitions of businesses or assets.

iv.We exclude seed capital and co-investment gains, losses, and related financing costs. The net returns on these investments are considered and presented separately from ENI because ENI is primarily a measure of our earnings from managing client assets, which therefore differs from earnings generated by our investments in Affiliate products, which can be variable from period to period.

v.We include cash tax benefits associated with deductions allowed for acquired intangibles and goodwill that may not be recognized or have timing differences compared to U.S. GAAP.

vi.We exclude the results of discontinued operations attributable to controlling interests since they are not part of our ongoing business and restructuring costs incurred in continuing operations.

vii.We exclude deferred tax resulting from changes in tax law and expiration of statutes, adjustments for uncertain tax positions, deferred tax attributable to intangible assets and other unusual items not related to current operating results to reflect ENI tax normalization.

We also adjust our income tax expense to reflect any tax impact of our ENI adjustments.

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Reconciliation of U.S. GAAP Net Income to Economic Net Income for the Three Months Ended March 31, 2023 and 2022

The following table reconciles net income attributable to controlling interests to economic net income for the three months ended March 31, 2023 and 2022: 

		Three Months Ended March 31,
($ in millions)		2023		2022
U.S. GAAP net income attributable to controlling interests		$	12.0	$	23.8
Adjustments to reflect the economic earnings of the Company:
i.	Non-cash key employee-owned equity and profit interest revaluations	(0.6)		(6.8)
ii.	Amortization of acquired intangible assets	—		—
iii.	Capital transaction costs	0.1		5.0
iv.	Seed/Co-investment (gains) losses and financings(1)	(0.8)		0.2
v.	Tax benefit of goodwill and acquired intangibles deductions	0.4		0.3
vi.	Discontinued operations attributable to controlling interests and restructuring(2)	0.4		0.4
vii.	ENI tax normalization	0.1		0.2
Tax effect of above adjustments, as applicable(3)		0.2		0.3
Economic net income		$	11.8	$	23.4

(1)The net return on seed/co-investment (gains) losses and financings for the three months ended March 31, 2023 and 2022 is shown in the following table:

	Three Months Ended March 31,
($ in millions)	2023			2022
Seed/Co-investment (gains) losses	$	(1.1)		$	0.1
Financing costs:
Seed/Co-investment average balance	19.1			4.3
Blended interest rate*	6.5		%	6.3		%
Financing costs	0.3			0.1
Net seed/co-investment (gains) losses and financing	$	(0.8)		$	0.2

* The blended rate is based on the weighted average rate of the long-term debt.

(2)The three months ended March 31, 2023 includes costs associated with the transfer of an insurance policy from our former parent of $0.4 million. The three months ended March 31, 2022 includes restructuring costs at the Affiliate of $0.1 million and costs associated with the transfer of an insurance policy from our former parent of $0.3 million.

(3)Reflects the sum of lines (i), (ii), (iii), (iv) and the restructuring component of line (vi) multiplied by the 27.3% U.S. statutory tax rate (including state tax).

Limitations of Economic Net Income

Economic net income is the key measure our management uses to evaluate the financial performance of, and make operational decisions for, our business. Economic net income is not audited and is not a substitute for net income or other performance measures that are derived in accordance with U.S. GAAP. Furthermore, our calculation of economic net income may differ from similarly titled measures provided by other companies.

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Because the calculation of economic net income excludes certain ongoing expenses, including amortization expense and certain compensation costs, it has certain material limitations and should not be viewed in isolation or as a substitute for U.S. GAAP measures of earnings.

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    ENI Revenues

The following table reconciles U.S. GAAP revenue to ENI revenue for the three months ended March 31, 2023 and 2022: 

	Three Months Ended March 31,
($ in millions)	2023		2022
U.S. GAAP revenue	$	91.8	$	112.2
Exclude revenue from consolidated Funds attributable to non-controlling interests	(0.7)		—
ENI revenue	$	91.1	$	112.2

The following table identifies the components of ENI revenue:

	Three Months Ended March 31,
($ in millions)	2023		2022
Management fees(1)	$	90.6	$	102.2
Performance fees(2)	0.5		10.0
ENI revenue	$	91.1	$	112.2

(1)ENI management fees correspond to U.S. GAAP management fees.

(2)ENI performance fees correspond to U.S. GAAP performance fees.

    ENI Operating Expenses

The largest difference between U.S. GAAP operating expense and ENI operating expense relates to compensation. As shown in the following reconciliation, we exclude the impact of key employee equity revaluations. Variable compensation and Affiliate key employee distributions are also segregated out of U.S. GAAP operating expense in order to align with the manner in which these items are contractually calculated at the Affiliate level.

The following table reconciles U.S. GAAP operating expense to ENI operating expense for the three months ended March 31, 2023 and 2022.

	Three Months Ended March 31,
($ in millions)	2023		2022
U.S. GAAP operating expense	$	72.0	$	69.0
Less: items excluded from economic net income
Non-cash key employee equity and profit interest revaluations	0.6		6.8
Restructuring costs(1)	(0.4)		(0.4)
Funds’ operating expense	(0.7)		—
Less: items segregated out of U.S. GAAP operating expense
Variable compensation	(23.2)		(27.9)
Affiliate key employee distributions	(1.2)		(1.9)
ENI operating expense	$	47.1	$	45.6

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(1)The three months ended March 31, 2023 includes $0.4 million of costs associated with the transfer of an insurance policy from our former parent. The three months ended March 31, 2022 includes $0.1 million of restructuring costs at the Affiliate and $0.3 million costs associated with the transfer of an insurance policy from our former parent.

The following table identifies the components of ENI operating expense:

	Three Months Ended March 31,
($ in millions)	2023		2022
Fixed compensation & benefits(1)	$	23.4	$	21.9
General and administrative expenses(2)	19.9		18.4
Depreciation and amortization	3.8		5.3
ENI operating expense	$	47.1	$	45.6

(1)Fixed compensation and benefits include base salaries, payroll taxes and the cost of benefit programs provided. The following table reconciles U.S. GAAP compensation and benefits expense for the three months ended March 31, 2023 and 2022 to ENI fixed compensation and benefits expense:

	Three Months Ended March 31,
($ in millions)	2023		2022
Total U.S. GAAP compensation and benefits expense	$	49.1	$	46.8
Non-cash key employee equity and profit interest revaluations excluded from ENI	0.6		6.8
Sales-based compensation reclassified to ENI general & administrative expenses	(1.9)		(1.9)
Affiliate key employee distributions	(1.2)		(1.9)
Variable compensation	(23.2)		(27.9)
ENI fixed compensation and benefits	$	23.4	$	21.9

(2)The following table reconciles U.S. GAAP general and administrative expense to ENI general and administrative expense:

	Three Months Ended March 31,
($ in millions)	2023		2022
U.S. GAAP general and administrative expense	$	18.4	$	16.9
Sales-based compensation	1.9		1.9
Restructuring costs	(0.4)		(0.4)
ENI general and administrative expense	$	19.9	$	18.4

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Key Non-GAAP Operating Metrics

The following table shows our key non-GAAP operating metrics for the three months ended March 31, 2023 and 2022. We present these metrics because they are the measures our management uses to evaluate the profitability of our business and are useful to investors because they represent the key drivers and measures of economic performance within our business model. Please see the footnotes below for an explanation of each ratio, its usefulness in measuring the economics and operating performance of our business, and a reference to the most closely related U.S. GAAP measure:

	Three Months Ended March 31,
($ in millions)	2023			2022
Numerator: ENI operating earnings(1)	$	20.8		$	38.7
Denominator: ENI revenue	$	91.1		$	112.2
ENI operating margin(2)	22.8		%	34.5		%
Numerator: ENI operating expense	$	47.1		$	45.6
Denominator: ENI management fee revenue(3)	$	90.6		$	102.2
ENI operating expense ratio(4)	52.0		%	44.6		%
Numerator: ENI variable compensation	$	23.2		$	27.9
Denominator: ENI earnings before variable compensation(1)(5)	$	44.0		$	66.6
ENI variable compensation ratio(6)	52.7		%	41.9		%
Numerator: Affiliate key employee distributions	$	1.2		$	1.9
Denominator: ENI operating earnings(1)	$	20.8		$	38.7
ENI Affiliate key employee distributions ratio(7)	5.8		%	4.9		%

(1)ENI operating earnings represents ENI earnings before Affiliate key employee distributions and is calculated as ENI revenue, less ENI operating expense, less ENI variable compensation. It differs from economic net income because it does not include the effects of Affiliate key employee distributions, net interest expense or income tax expense.

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The following table reconciles U.S. GAAP operating income to ENI operating earnings:

	Three Months Ended March 31,
($ in millions)	2023		2022
U.S. GAAP operating income	$	19.8	$	43.2
Exclude the impact of:
Affiliate key employee-owned equity and profit interest revaluations	(0.6)		(6.8)
Restructuring costs(a)	0.4		0.4
Affiliate key employee distributions	1.2		1.9
Variable compensation	23.2		27.9
ENI earnings before variable compensation	44.0		66.6
Less: ENI variable compensation	(23.2)		(27.9)
ENI operating earnings	20.8		38.7
Less: ENI Affiliate key employee distributions	(1.2)		(1.9)
ENI earnings after Affiliate key employee distributions	$	19.6	$	36.8

(a)The three months ended March 31, 2023 includes $0.4 million of costs associated with the transfer of an insurance policy from our former parent. The three months ended March 31, 2022 includes $0.1 million of restructuring costs at our Affiliate and $0.3 million of costs associated with the transfer of an insurance policy from our former parent.

(2)The ENI operating margin, which is calculated before Affiliate key employee distributions, is used by management and is useful to investors to evaluate the overall operating margin of the business. The ENI operating margin is most comparable to our U.S. GAAP operating margin. Our U.S. GAAP operating margin, excluding the effect of consolidated Funds, is 21.7% for the three months ended March 31, 2023, and 38.5% for the three months ended March 31, 2022.

The ENI operating margin is important because it gives investors an understanding of the profitability of the total business relative to revenue, irrespective of the ownership position which we have in our Affiliate. Management and investors use this ratio when comparing our profitability relative to our peer group and evaluating our ability to manage the cost structure and profitability of our business under different operating environments.

(3)ENI management fee revenue corresponds to U.S. GAAP management fee revenue.

(4)The ENI operating expense ratio is used by management and is useful to investors to evaluate the level of operating expense as measured against our recurring management fee revenue. We have provided this ratio since many operating expenses, including fixed compensation and benefits and general and administrative expense, are generally linked to the overall size of the business. We track this ratio as a key measure of scale economies because in our profit-sharing economic model, scale benefits both the Affiliate employees and our stockholders. The ENI operating expense ratio is most comparable to the U.S. GAAP operating expense / management fee revenue ratio.

(5)ENI earnings before variable compensation is calculated as ENI revenue, less ENI operating expense.

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(6)The ENI variable compensation ratio is used by management and is useful to investors to evaluate consolidated variable compensation as measured against our ENI earnings before variable compensation. Variable compensation is contractually set and calculated individually at our Affiliate, plus Center bonuses. Variable compensation is usually awarded based on a contractual percentage of our Affiliate’s ENI earnings before variable compensation and may be paid in the form of cash or non-cash Affiliate equity or profit interests. Center variable compensation includes cash and our equity. Non-cash variable compensation awards typically vest over several years and are recognized as compensation expense over that service period. The variable compensation ratio at our Affiliate is calculated as variable compensation divided by ENI earnings before variable compensation. The ENI variable compensation ratio is most comparable to the U.S. GAAP variable compensation ratio.

(7)The ENI Affiliate key employee distribution ratio is used by management and is useful to investors to evaluate Affiliate key employee distributions as measured against our ENI operating earnings. Affiliate key employee distributions represent the share of Affiliate profits after variable compensation that is attributable to Affiliate key employee equity and profit interests holders, according to their ownership interests. The Affiliate key employee distribution ratio at our Affiliate is calculated as Affiliate key employee distributions divided by ENI operating earnings at that Affiliate. Within our Affiliate, we have a tiered equity structure, where BSUS and other classes of employee equity holders are entitled to an initial proportionate preference over profits after variable compensation, structured such that before a preference threshold is reached, there would be no required key employee distributions to the tiered equity holders, whereas for profits above the threshold the key employee distribution amount to the tiered equity holders would be calculated based on the tiered key employee ownership percentages. The ENI Affiliate key employee distributions ratio is most comparable to the U.S. GAAP Affiliate key employee distributions ratio.

Tax on Economic Net Income

The following table reconciles the United States statutory tax to tax on economic net income:

	Three Months Ended March 31,
($ in millions)	2023			2022
Pre-tax economic net income(1)	$	16.2		$	32.2
Taxes at the U.S. federal and state statutory rates(2)	(4.4)			(8.8)
Economic net income	$	11.8		$	23.4
Economic net income effective tax rate(3)	27.2		%	27.3		%

(1)Includes interest income and third-party ENI interest expense, as shown in the following table:

	Three Months Ended March 31,
($ in millions)	2023		2022
U.S. GAAP interest income	$	1.1	$	—
U.S. GAAP interest expense	(4.9)		(6.5)
U.S. GAAP net interest expense	(3.8)		(6.5)
Other ENI interest expense exclusions(a)	0.4		1.9
ENI net interest expense	(3.4)		(4.6)
ENI earnings after Affiliate key employee distributions(b)	19.6		36.8
Pre-tax economic net income	$	16.2	$	32.2

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(a)Other ENI interest expense exclusions represent cost of financing on seed capital and co-investments and amortization of debt issuance costs.

(b)ENI earnings after Affiliate key employee distributions is calculated as ENI operating income (ENI revenue, less ENI operating expense, less ENI variable compensation), less Affiliate key employee distributions. Refer to “—Key Non-GAAP Operating Metrics” for a reconciliation from U.S. GAAP operating income (loss) to ENI earnings after Affiliate key employee distributions.

(2)Taxed at U.S. Federal and State statutory rate of 27.3%.

(3)The economic net income effective tax rate is calculated by dividing the tax on economic net income by pre-tax economic net income.

    Segment Analysis

We operate our business through the following reportable segment:

•Quant & Solutions—comprised of versatile, often highly-tailored strategies that leverage data and technology in a computational, factor-based investment process across a range of asset classes in developed and emerging markets, including global, non-U.S. and small-cap equities, as well as managed volatility, ESG, multi-asset, equity alternatives, and long/short strategies. This segment is comprised of our interest in Acadian.    

The corporate head office is included within the Other category. The corporate head office expenses are not allocated to the Company’s business segment but the CODM does consider the cost structure of the corporate head office when evaluating the financial performance of our segment.

The primary measure used by the CODM in measuring performance and allocating resources to the segments is ENI. We define economic net income for the segments as ENI revenue less (i) ENI operating expenses, (ii) variable compensation and (iii) key employee distributions. The ENI adjustments to U.S. GAAP include both reclassifications of U.S. GAAP revenue and expense items, as well as adjustments to U.S. GAAP results, primarily to exclude non-cash, non-economic expenses, or to reflect cash benefits not recognized under U.S. GAAP.

ENI revenue includes management fees, performance fees and other revenue under U.S. GAAP, adjusted to include management fees paid to Affiliates by consolidated Funds and our share of earnings from our equity-accounted Affiliate.

ENI operating expenses include compensation and benefits, general and administrative expense, and depreciation and amortization under U.S. GAAP, adjusted to exclude non-cash expenses representing changes in the value of Affiliate equity and profit interests held by Affiliate key employees and impairment of goodwill. Additionally, variable compensation and Affiliate key employee distributions are segregated from ENI operating expenses.

ENI segment results are also adjusted to exclude the portion of consolidated Funds’ revenues, expenses and investment return recorded under U.S. GAAP.

Refer to the reconciliations of U.S. GAAP revenue to ENI revenue, U.S. GAAP Operating expense to ENI Operating expense, variable compensation and Affiliate key employee distributions disclosed previously within this section.

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    Segment ENI Revenue

The following table identifies the components of segment ENI revenue for the three months ended March 31, 2023 and 2022:

	Three Months Ended March 31,
($ in millions)	2023				2022
	Quant & Solutions		Total		Quant & Solutions		Total
Management fees	$	90.6	$	90.6	$	102.2	$	102.2
Performance fees	0.5		0.5		10.0		10.0
ENI revenue	$	91.1	$	91.1	$	112.2	$	112.2

Quant & Solutions Segment ENI Revenue

Three months ended March 31, 2023 compared to three months ended March 31, 2022: Quant & Solutions ENI revenue decreased $(21.1) million, or (18.8)%, from $112.2 million for the three months ended March 31, 2022 to $91.1 million for the three months ended March 31, 2023. The decrease was attributable to (11.4)% lower management fees, driven by lower average AUM and lower performance fees that are variable and are contractually triggered based on investment performance results over agreed upon time periods.

    Segment ENI Expense

The following table identifies the components of segment ENI expense for the three months ended March 31, 2023 and 2022:

	Three Months Ended March 31,
($ in millions)	2023						2022
	Quant & Solutions		Other		Total		Quant & Solutions		Other		Total
Fixed compensation & benefits	$	21.6	$	1.8	$	23.4	$	19.8	$	2.1	$	21.9
General and administrative expense	18.2		1.7		19.9		16.1		2.3		18.4
Depreciation and amortization	3.8		—		3.8		5.2		0.1		5.3
Total ENI operating expenses	$	43.6	$	3.5	$	47.1	$	41.1	$	4.5	$	45.6
Variable compensation	22.5		0.7		23.2		26.3		1.6		27.9
Affiliate key employee distributions	1.2		—		1.2		1.9		—		1.9
Total expenses	$	67.3	$	4.2	$	71.5	$	69.3	$	6.1	$	75.4

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Quant & Solutions Segment ENI Expense

Three months ended March 31, 2023 compared to three months ended March 31, 2022: Quant & Solutions ENI operating expense increased $2.5 million, or 6.1%, from $41.1 million for the three months ended March 31, 2022 to $43.6 million for the three months ended March 31, 2023. The increase was driven by 9.1% higher ENI fixed compensation and benefits expense resulting from cost of living increases and the cost of new hires supporting Acadian’s growth initiatives and 13.0% higher ENI general and administrative expense primarily due to higher travel and entertainment, consultant, and systems costs. Quant & Solutions ENI variable compensation expense is based on contractual percentage of earnings before variable compensation, and also includes a formulaic split of performance fee revenue that gets deferred and recognized as variable compensation expense over a three-year vesting period. Quant & Solutions ENI variable compensation expense decreased (14.4)% as a result of lower earnings before variable compensation in the current period, partially offset by the inclusion of deferred compensation expense earned on prior year performance fee revenues. Affiliate key employee distributions attributable to Quant & Solutions decreased (36.8)%, impacted by lower ENI earnings after variable compensation, and the leveraged nature of the distribution share.

Other ENI Expense

Three months ended March 31, 2023 compared to three months ended March 31, 2022: Other ENI operating expense decreased $(1.0) million, or (22.2)%, from $4.5 million for the three months ended March 31, 2022 to $3.5 million for the three months ended March 31, 2023. The decrease was driven by (14.3)% lower fixed compensation and benefit expense due to lower payroll taxes and lower headcount at the corporate head office and (26.1)% lower general and administrative expense resulting from cost-saving initiatives. Other ENI variable compensation expense decreased (56.3)% due to lower non-cash equity compensation amortization at the corporate head office.

Capital Resources and Liquidity

    Cash Flows

The following table summarizes certain key financial data relating to cash flows. All amounts presented exclude consolidated Funds: 

	Three Months Ended March 31,
($ in millions)	2023		2022
Cash provided by (used in)
Operating activities	$	(34.3)	$	(14.4)
Investing activities	(5.6)		(4.0)
Financing activities	85.5		(144.9)

Comparison for the three months ended March 31, 2023 and 2022

Net cash from operating activities decreased $(19.9) million, from net cash used of $14.4 million for the three months ended March 31, 2022 to net cash used of $34.3 million for the three months ended March 31, 2023, driven by changes in net income offset by changes in operating assets and liabilities in the three months ended March 31, 2022. In the three months ended March 31, 2023, net cash from investing activities decreased $(1.6) million, from $(4.0) million used in the three months ended March 31, 2022 to $(5.6) million used in the three months ended March 31, 2023, driven by higher net purchases of investment securities in the three months ended March 31, 2023. Net cash from financing activities increased $230.4 million, from $(144.9) million used in the three months ended March 31, 2022 to $85.5 million provided in the three months ended March 31, 2023, primarily due to the repayment of third party borrowings and higher share repurchases in the three months ended March 31, 2022.

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    Supplemental Liquidity Measure — Adjusted EBITDA

As supplemental information, we provide information regarding Adjusted EBITDA, which we define as economic net income before net interest, income taxes, depreciation, and amortization. Adjusted EBITDA is a non-GAAP liquidity measure that we provide in addition to, but not as a substitute for, cash flows from operating activities. It should be noted that our calculation of Adjusted EBITDA may not be consistent with Adjusted EBITDA as calculated by other companies. We believe Adjusted EBITDA is a useful liquidity metric because it indicates our ability to make further investments in our business, service debt and meet working capital requirements.

The following table reconciles our U.S. GAAP net income attributable to controlling interests to EBITDA to Adjusted EBITDA to economic net income for the three months ended March 31, 2023 and 2022.

	Three Months Ended March 31,
($ in millions)	2023		2022
Net income attributable to controlling interests	$	12.0	$	23.8
Net interest expense to third parties	3.8		6.5
Income tax expense	5.1		9.6
Depreciation and amortization (including intangible assets)	3.8		5.4
EBITDA	$	24.7	$	45.3
Non-cash compensation costs, including revaluation of Affiliate key employee-owned equity and profit interests	(0.4)		(5.9)
(Gain) loss on seed and co-investments	(1.1)		0.1
Restructuring expenses(1)	0.4		0.3
Capital transaction costs	—		3.2
Adjusted EBITDA	$	23.6	$	43.0
ENI net interest expense to third parties	(3.4)		(4.6)
Depreciation and amortization(2)	(4.0)		(6.2)
Tax on economic net income	(4.4)		(8.8)
Economic net income	$	11.8	$	23.4

(1)The three months ended March 31, 2023 includes $0.4 million of costs associated with the transfer of an insurance policy from our former parent. The three months ended March 31, 2022 includes $0.1 million of restructuring costs at our Affiliate and costs associated with the transfer of an insurance policy from our former parent of $0.3 million.

(2)Includes non-cash equity-based award amortization expense.

Limitations of Adjusted EBITDA

As a non-GAAP, unaudited liquidity measure and derivation of EBITDA, Adjusted EBITDA has certain material limitations. It does not include cash costs associated with capital transactions and excludes certain U.S. GAAP expenses that fall outside the definition of EBITDA. Each of these categories of expense represents costs to us of doing business, and therefore any measure that excludes any or all of these categories of expense has material limitations.

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    Future Capital Needs

We believe that our available cash and cash equivalents to be generated from operations, supplemented by short-term and long-term financing, as necessary, will be sufficient to fund current operations and capital requirements for at least the next twelve months, as well as our day-to-day operations and future investment requirements. Our ability to secure short-term and long-term financing in the future will depend on several factors, including our future profitability, our relative levels of debt and equity and the overall condition of the credit markets.

    Borrowings and Long-Term Debt

The following table summarizes our financing arrangements as of the dates indicated: 

($ in millions)	March 31, 2023		December 31, 2022		Interest rate	Maturity
Revolving credit facility:
$125 million revolving credit facility	$	87.0	$	—	Variable rate	March 7, 2025
Total revolving credit facility	$	87.0	$	—
Third party borrowings:
4.80% Senior Notes Due 2026	$	273.6	$	273.5	4.80%	July 27, 2026
5.125% Senior Notes Due 2031(1)	—		—		5.125%	August 1, 2031
Total third party borrowings	$	273.6	$	273.5

(1)On January 18, 2022, the Company completed the full redemption of the $125 million aggregate principal amount outstanding of its 5.125% Senior Notes due August 1, 2031. As a result of this transaction, the Company recorded $3.2 million of loss on extinguishment of debt within the Condensed Consolidated Statements of Operations for the three months ended March 31, 2022.

Revolving Credit Facility

On March 7, 2022, we, Royal Bank of Canada, BMO Harris Bank, N.A., Goldman Sachs Bank USA, Morgan Stanley Bank, N.A., Bank of America N.A., the Bank of New York Mellon and Citibank, N.A., as an issuing bank and administrative agent (collectively, the “Lenders”), entered into a new revolving credit facility agreement (“Acadian Credit Agreement”), which replaced our revolving credit facility dated as of August 20, 2019 (as amended by an amendment dated September 3, 2020 and an assignment and assumption and amendment agreement dated February 23, 2021, the “Original Credit Agreement”). The maturity date of the Original Credit Agreement was August 22, 2022, and the maturity date of the Acadian Credit Agreement is March 7, 2025.

Borrowings under the Acadian Credit Agreement bear interest, at Acadian’s option, at the per annum rate equal to either (a) the greatest of (i) the prime rate, (ii) the federal funds effective rate plus 0.5% and (iii) the secured overnight financing rate for a one month period plus a credit spread adjustment of 0.10% (“Adjusted Term SOFR”) plus 1%, plus, in each case an additional amount ranging from 0.5% to 1.0%, with such additional amount based on Acadian’s Leverage Ratio (as defined below) or (b) Adjusted Term SOFR plus an additional amount ranging from 1.5% to 2.0%, with such additional amount based on Acadian’s Leverage Ratio. In addition, Acadian is charged a commitment fee based on the average daily unused portion of the revolving credit facility under the Acadian Credit Agreement at a per annum rate ranging from 0.25% to 0.375%, with such amount based on Acadian’s Leverage Ratio.

Under the Acadian Credit Agreement, the ratio of Acadian’s third-party borrowings to Acadian’s trailing twelve months Adjusted EBITDA, as defined by the Acadian Credit Agreement (the “Leverage Ratio”), cannot exceed 2.5x and the ratio of Acadian’s trailing twelve months Adjusted EBITDA to Acadian’s interest expense (the “Interest Coverage Ratio”) must be not less than 4.0x. At March 31, 2023, Acadian’s Leverage Ratio was 0.6x and Acadian’s Interest Coverage Ratio was 74.5x.

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Other Compensation Liabilities

Other compensation liabilities principally consist of cash-settled Affiliate equity and profit interests liabilities held by certain Affiliate key employees, and voluntary deferred compensation plans. The following table summarizes our other long-term liabilities:

	March 31, 2023		December 31, 2022
($ in millions)
Share-based payments liability	$	19.0	$	19.4
Affiliate profit interests liability	—		—
Employee equity	19.0		19.4
Voluntary deferral plan liability	41.1		39.9
Total	$	60.1	$	59.3

Share-based payments liability represents the value of Affiliate key employee-owned equity that may under certain circumstances be repurchased by us that is considered an equity award under U.S. GAAP based on the terms and conditions attached to these interests. Affiliate profit interests liability represents the value of Affiliate key employee-owned equity that may under certain circumstances be repurchased by us that is not considered an equity award under U.S. GAAP, but rather a form of compensation arrangement, based on the terms and conditions attached to these interests. Our obligation in any given period in respect of funding these potential repurchases of Affiliate equity is limited to only that portion that may be put to us by Affiliate key employees, which is typically capped annually under the terms of these arrangements such that we are not required to repurchase more than we can reasonably recycle by re-granting the interests in lieu of cash variable compensation owed to Affiliate key employees.

Certain of our and our Affiliate’s key employees are eligible to participate in our voluntary deferral plan, or VDP, which provides our senior personnel the opportunity to voluntarily defer a portion of their compensation. There is a voluntary deferral plan investment balance included in investments on the Condensed Consolidated Balance Sheets that corresponds to this deferral liability.

Additionally, we have recorded accrued incentive compensation of $24.0 million and $92.5 million on the Condensed Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022, respectively. Included within the accrued incentive compensation balance is the vested portion of Acadian’s deferred compensation pool. Acadian’s deferred compensation pool is based on a contractual percentage of Acadian performance fee revenues and post-bonus profits, and is subject to a three-year vesting period. Compensation expense is recognized over the requisite service period. Unamortized compensation expense related to the unvested portion of the deferred compensation pool of $17.6 million, $10.7 million and $0.1 million is expected to be recognized in the years ending December 31, 2023, 2024 and 2025, respectively.

Critical Accounting Policies and Estimates

There have been no significant changes to the critical accounting policies and estimates disclosed in our most recent Form 10-K for the year ended December 31, 2022. Critical accounting policies and estimates are those that require management’s most difficult, subjective or complex judgments and would therefore be deemed the most critical to an understanding of our results of operations and financial condition.

    Recent Accounting Developments

See discussion of Recent Accounting Developments in Note 2 of the accompanying Condensed Consolidated Financial Statements.

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Forward Looking Statements

This Quarterly Report on Form 10-Q includes forward-looking statements, which may include, from time to time, anticipated revenues, margins, cash flows or earnings, anticipated future performance of our business, our expected future net cash flows, our anticipated expense levels, capital management, financial condition, results of operations and cash flows, and/or expectations regarding market conditions. The words or phrases “will likely result,” “are expected to,” “will continue,” “is anticipated,” “can be,” “may be,” “aim to,” “may affect,” “may depend,” “intends,” “expects,” “believes,” “estimate,” “plan,” “project,” and other similar expressions are intended to identify such forward-looking statements. Such statements are subject to various known and unknown risks and uncertainties and we caution readers that any forward-looking information provided by or on behalf of us is not a guarantee of future performance.

Actual results may differ materially from those in forward-looking information as a result of various factors, some of which are beyond our control, including but not limited to those discussed above and elsewhere in this Quarterly Report on Form 10-Q, in our most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 28, 2023, and subsequent SEC filings. Due to such risks and uncertainties and other factors, we caution each person receiving such forward-looking information not to place undue reliance on such statements. Further, such forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q and we undertake no obligations to update any forward looking statement to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q or to reflect the occurrence of unanticipated events.

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Item 3.  Quantitative and Qualitative Disclosures About Market Risk.

Market Risk

Our exposure to market risk is directly related to our role as an asset manager. Substantially all of our investment management revenues are derived from our agreements with our clients. Under these agreements, the revenues we receive are based on the value of our assets under management or the investment performance on client accounts for which we earn performance fees. Accordingly, our revenues and net income may decline as a result of our assets under management decreasing due to depreciation of our investment portfolios. In addition, such depreciation could cause our clients to withdraw their funds in favor of investments offering higher returns or lower risk, which would cause our revenues and net income to decline further.

Our model for assessing the impact of market risk on our results uses March 31, 2023 ending AUM and management fee rates as the basis for management fee revenue calculations. With respect to performance fee revenue, we assume that relative investment performance is the same as in the past four quarters ended March 31, 2023. Therefore, market-driven changes in performance fees, which are typically based on relative performance versus market indices, reflect changes in the underlying AUM used in the calculation rather than differences in relative performance as a result of a changed market environment. The impact that market changes have on performance fee eligible accounts varies due to high-water marks and other measurement hurdles which are not factored in this analysis. Changes in performance fees revenues could be significant in each period. The basis for the analysis is performance fees earned for the twelve months ended March 31, 2023.

Our profit sharing economic structure results in a sharing of market risk between us and our employees. Approximately 35% of our ENI cost structure is variable, representing variable compensation and Acadian key employee distributions. These variable expenses generally are linked in a formulaic manner to the profitability of the business after covering operating expenses, which include base compensation and benefits, general and administrative expenses, and depreciation and amortization. In modeling the impact of market risk, we assume that these operating expenses remain unchanged, but the resulting impact on profit driven by increases or decreases in revenue will change variable compensation and Affiliate key employee distributions in line with their formulaic calculations. Any change in pre-tax profit is tax-affected at our statutory combined state and federal rate of approximately 27.3% to calculate profit after tax.

The value of our assets under management was $97.5 billion as of March 31, 2023. A 10% increase or decrease in the value of our assets under management, if proportionally distributed over all of our investment strategies, asset classes and client relationships, would cause an annualized increase or decrease in our gross management fee revenues of approximately $37.1 million based on our current weighted average fee rate of approximately 38 basis points. Approximately $12.7 billion, or 13%, of our AUM, are in accounts subject to performance fees. Of these assets, the majority are in accounts for which performance fees, or management fee adjustments, are calculated based on investment return that differs from the relative benchmark returns. Assuming the market change does not impact our relative performance, a 10% increase or decrease in AUM would have a $4.0 million impact to our gross performance fees based on our trailing twelve month performance fees of $39.9 million from Quant & Solutions segment as of March 31, 2023. The combined impact on our management fees and performance fees would have a direct impact on our earnings and result in an annual change of approximately $18.7 million in our post-tax economic net income, given our current cost structure and operating model.

Equity market risk, interest rate risk, and foreign currency risk are the market risks that could have the greatest impact on our management fees, performance fees and our business profitability. Impacts on our management and performance fees can be calculated based on the percentage of AUM constituting equity investments or foreign currency denominated investments, respectively, multiplied by the relevant weighted average management fee and performance fee attributable to that asset class.

•Our equity markets-based AUM includes U.S. equities (including small cap through large cap securities and substantially value or blended investment styles) and global/non-U.S. equities (including global, non-U.S. and emerging markets securities). A 10% increase or decrease in equity markets would cause our $95.0 billion of

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equity assets under management to increase or decrease by $9.5 billion, resulting in a change in annualized management fee revenue of $36.2 million and an annual change in post-tax economic net income of approximately $17.3 million, given our current cost structure, operating model, and weighted average fee rate of 38 basis points at the mix of strategies as of March 31, 2023. Approximately $12.4 billion, or 13%, of our equity markets-based AUM are in accounts subject to performance fees. Of these assets, the majority are in accounts for which performance fees are calculated based on investment return in excess of the relative benchmark returns. Assuming the market change does not impact our relative performance, a 10% change in equity markets would have an approximate incremental $1.0 million impact from performance fees on our post-tax economic net income, given our current cost structure and operating model.

•Foreign currency AUM includes equity and alternative assets denominated in foreign currencies. A 10% increase or decrease in foreign exchange rates against the U.S. dollar would cause our $77.3 billion of foreign currency denominated AUM to increase or decrease by $7.7 billion, resulting in a change in annualized management fee revenue of $31.2 million and an annual change in post-tax economic net income of $14.9 million, based on weighted average fees earned on our foreign currency denominated AUM of 40 basis points at the mix of strategies as of March 31, 2023. Approximately $10.7 billion, or 14%, of our foreign currency denominated AUM are in accounts subject to performance fees. Of these assets, the majority are in accounts for which performance fees, or management fee adjustments, are calculated based on investment return that differs from the relative benchmark returns. Assuming the market change does not impact our relative performance, a 10% change in foreign currency exchange rates would have an approximate incremental $0.5 million impact from performance fees on our post-tax economic net income, given our current cost structure and operating model.

While the analysis above assumes that market changes occur in a uniform manner across the relevant portfolio, because of our declining fee rates for larger relationships and differences in our fee rates across asset classes, a change in the composition of our assets under management, in particular an increase in the proportion of our total assets under management attributable to strategies, clients or relationships with lower effective fee rates, could have a material negative impact on our overall weighted average fee rate.

As is customary in the asset management industry, clients invest in particular strategies to gain exposure to certain asset classes, which exposes their investment to the benefits and risks of such asset classes. We have not adopted a corporate-level risk management policy regarding client assets, nor have we attempted to hedge at the corporate level or within individual strategies the market risks that would affect the value of our overall assets under management and related revenues. Any reduction in the value of our assets under management would result in a reduction in our revenues.

Interest Rate Risk

We are exposed to interest rate risks primarily through borrowings under Acadian’s revolving credit facility. Interest on borrowings under the revolving credit facility is based upon variable interest rates. Borrowings under the credit facility were $87.0 million as of March 31, 2023. We currently do not hedge against interest rate risk. As of March 31, 2023, a hypothetical 10% change in interest rates would have resulted in an immaterial change to our interest expense during the three months ended March 31, 2023.

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Item 4.  Controls and Procedures.

Controls and Procedures

Our management, including our principal executive officer and our principal financial officer, evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) at March 31, 2023. Based on this evaluation, our principal executive officer and our principal financial officer have concluded that our disclosure controls and procedures are effective.

Internal Control over Financial Reporting

There have been no changes in internal control over financial reporting during the quarter ended March 31, 2023 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

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PART II — OTHER INFORMATION

Item 1.         Legal Proceedings.

From time to time, we and our Affiliates may be parties to various claims, suits, and complaints in the ordinary course of our business. Although the amount of liability that may result from these matters cannot be ascertained, we do not currently believe that, in the aggregate, they will result in liabilities material to our consolidated financial condition, future results of operations or cash flow.

Item 1A.  Risk Factors.

There have been no material changes in the risk factors described in the Company's Annual Report on Form 10-K for the year ended December 31, 2022.

Item 5.         Other Events.

On May 4, 2023, BSUS entered into an amended and restated employment agreement (the “Amended Employment Agreement”) with Christina Wiater, the Company’s SVP, Principal Financial and Accounting Officer, which amends and restates the Employment Agreement, dated May 4, 2022, between BSUS and Ms. Wiater (the “Prior Agreement”). Under the terms of the Amended Employment Agreement, Ms. Wiater will continue to receive an annual base salary of $425,000 and will be eligible to receive (i) a target annual bonus of $700,000, subject to individual and Company performance. Under the terms of the Amended Employment Agreement, if Ms. Wiater’s employment is terminated by the Company without cause or by Ms. Wiater for good reason (each as defined in the Amended Employment Agreement), Ms. Wiater would be entitled to (i) the greater of (a) 12 months’ base salary plus her most recently paid annual bonus or (b) $1,125,000, (ii) payment of COBRA premiums for 12 months, (iii) a cash bonus for the year in which the termination occurs equal to the greater of (a) her most recently paid annual bonus and (b) $700,000, in each case pro-rated to reflect the number of days worked during the year, and (iv) accelerated vesting of all of her outstanding restricted stock and restricted stock unit awards. The material terms of the Amended Employment Agreement are otherwise consistent with the Prior Agreement. The foregoing is not a complete description of the Amended Employment Agreement and is qualified in its entirety by reference to the full text and terms of the Amended Employment Agreement, which is filed as Exhibit 10.1 to this quarterly report on Form 10-Q and incorporated herein by reference.

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Item 6.         Exhibits.

Exhibit No.	Description
3.1	Amended and Restated Certificate of Incorporation of BrightSphere Investment Group Inc., adopted as of July 12, 2019, incorporated herein by reference to Exhibit 3.1 to the Current Report on Form 8-K12B filed on July 15, 2019.
3.2	Amended and Restated Bylaws of BrightSphere Investment Group Inc., adopted as of February 27, 2023, incorporated herein by reference to Exhibit 3.2 to the Annual Report on Form 10-K filed on February 28, 2023.
10.1*	Amended and Restated Employment Agreement, dated May 4, 2023, by and between BrightSphere Inc. and Christina Wiater
31.1*	Certification of the Company’s principal executive officer pursuant to Exchange Act Rules 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of the Company’s principal financial officer pursuant to Exchange Act Rules 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**	Certification of the Company’s principal executive officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**	Certification of the Company’s principal financial officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101*	Interactive data files pursuant to Rule 405 of Regulation S-T: (i) the Condensed Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022, (ii) the Condensed Consolidated Statements of Operations for the three months ended March 31, 2023 and 2022, (iii) the Condensed Consolidated Statements of Comprehensive Income for the three months ended March 31, 2023 and 2022, (iv) the Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three months ended March 31, 2023 and 2022, (v) the Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2023 and 2022, and (vi) the Notes to Financial Statements.
104*	The cover page of this Quarterly Report on Form 10-Q, formatted in Inline eXtensible Business Reporting Language

* Filed herewith

** Furnished herewith

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		BrightSphere Investment Group Inc.
Dated:	May 8, 2023
		By:	/s/ Suren Rana
			Suren Rana President and Chief Executive Officer (principal executive officer)
			/s/ Christina Wiater
			Christina Wiater Senior Vice President and Principal Financial Officer (principal financial officer and principal accounting officer)

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EX-10.1

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the “Agreement”) is effective as of the 4th day of May, 2023 by and between BrightSphere Inc., a Delaware corporation with an address at 200 State Street, 13th Floor, Boston, Massachusetts 02109 (“BrightSphere”), and Christina Wiater (the “Employee”).

WHEREAS, BrightSphere and the Employee previously entered into an employment agreement dated May 4, 2022 (the “2022 Agreement”); and

WHEREAS, the parties desire to amend and restate the 2022 Agreement in its entirety as follows.

1.DEFINITIONS

In this Agreement, unless the context otherwise requires:

(i)    The following terms shall have the following meanings:

“Basic Termination Payments” means (i) the Salary payable to Employee under Section 4.1 through the termination of employment, (ii) any expense reimbursements under Section 4.6 for expenses reasonably incurred in the performance of the Employee’s duties prior to termination, and (iii) the value of any unused vacation accrued to the date of termination of employment;

“Board” means the Board of Directors of the Company or any entity controlling the Company, including without limitation BrightSphere Investment Group Inc.;

“Cause” means (i) the Employee’s willful or reckless misconduct, or gross, continuing or repeated negligence in the performance of the Employee’s duties and responsibilities with respect to the Company, or her material failure to carry out directions which are reasonable in light of the Employee’s primary duties and responsibilities, or any other conduct that results in substantial injury (monetary or otherwise) to the Company or its officers, directors, employees or other agents; (ii) the Employee’s conviction of a felony (including but not limited to any felony conviction occurring prior to the Commencement Date), which has or could have a material adverse effect (monetary or otherwise) on the Company or its officers, directors, employees or other agents; (iii) the Employee’s embezzlement or misappropriation of funds, commission of any material act of dishonesty, fraud or deceit, or violation of any federal or state law applicable to the securities industry (including but not limited to any instances of such misconduct occurring prior to the Commencement Date); (iv) the Employee’s material breach of a legal or fiduciary duty owed to the Company or its officers, directors, employees or other agents; or (v) the Employee’s material breach of any provision of any agreement between the Employee and the Company and its officers, directors, employees or other agents, any Company policy or practice, or any applicable law. Notwithstanding anything in the paragraph to the contrary, this paragraph is not intended to prohibit the Employee from regular and customary critique, evaluation, discipline, or as applicable, termination of the employment or engagement of any officers, employees or agents in the course of the Employee’s duties for the Company. Prior to terminating the Employee for Cause pursuant to clauses (i) and (iv) above, the Company shall provide the Employee with written

1

notice detailing the alleged acts constituting Cause and fifteen (15) days thereafter with an opportunity to cure such acts to the extent such acts are able to be cured.

“COBRA” means Section 601 et seq. of the Employee Retirement Income Security Act of 1974, as amended, and Section 4980B of the Code.

“Code” means the Internal Revenue Code of 1986, as amended.

“Commencement Date” means April 15, 2020;

“Company” means BrightSphere, any company that is a subsidiary or holding company (up to and including the ultimate holding company) of the Company and any subsidiary of any such holding company, and any person or entity directly or indirectly controlling, being controlled by, or under common control with BrightSphere.

“Compensation Committee” means the Compensation Committee of the Board, if any; provided, however, if there should be no Compensation Committee, then such reference to the Compensation Committee shall be to the Board or other authorized body or officer of the Company performing the described function;

“Confidential Information” means any confidential information concerning the business or affairs of the Company or concerning the Company’s customers, clients, vendors, suppliers, business partners, advisors, consultants or employees, including but not limited to the following: any financial information or valuation information concerning the Company, and any other proprietary information of the Company, including that relating to the demonstrably anticipated business of the Company that the Employee obtains, develops or learns in the course of the Employee’s employment by the Company and any and all memoranda, notes, reports, documents, emails and other media containing the foregoing. Confidential Information specifically includes: any inventions (whether or not patentable), works of authorship, designs, know-how, ideas and information made or conceived or reduced to practice, in whole or in part, by the Employee during the term of the Employee’s employment, all business, technical and financial information, including trade secrets, information about clients, including their names, addresses and investment history; information about employees or applicants for employment, their compensation, qualifications and performance levels; all information regarding fees, commissions and compensation; all investment, advisory, technical or research data, and financial models developed by the Company and its employees; methods of operation; manuals, books and notes regarding the Company’s products and services; all drawings, designs, patterns, devices, methods, techniques, compilations, processes, product specifications and guidelines, future plans, cost and pricing information, computer programs, formulas, and equations; the cost to the Company of supplying its products and services; written business records, files, documents, specifications, plans and compilations of information concerning the business of the Company; and reports, correspondence, records account lists, price lists, budgets, indices, invoices and telephone records that the Employee obtains, develops, or learns in the course of the Employee’s employment by the Company. “Confidential Information” shall include the Confidential Information of any third party disclosed to the Company under confidentiality obligations and any information which a reasonable person would consider confidential due to the circumstances surrounding disclosure or due to the nature of the information. Confidential

2

Information shall not apply to information that has been independently developed by others or has become generally known through no wrongful act on the part of the Employee or any other person having an obligation of confidentiality to the Company;

“Disability” means that the Employee has, for 90 consecutive days or 180 days in any 12-month period, been disabled as a result of any mental or physical illness in a manner which prevents him from performing the essential functions of her job, with or without reasonable accommodation determined by an independent qualified medical doctor selected by the Company. In such circumstances, the Employee hereby agrees to submit to a medical examination by a qualified medical practitioner appointed by the Company and reasonably acceptable to the Employee;

“Equity Plan” means the BrightSphere Investment Group Inc. Equity Incentive Plan (as amended from time to time).

“Good Reason” means the occurrence of one or more of the following without the Employee’s consent, other than on account of Employee’s inability to perform her duties on account of mental or physical disability: (i) any reduction of the Employee’s Salary; (ii) an adverse change to the Employee’s current title of Principal Financial and Accounting Officer of the Company or reporting relationship; (iii) a material change in the geographic location at which the Employee must regularly perform services for the Company (which, for purposes of this Agreement, means a change in Employee’s principal place of employment by 50 or more miles, provided that such relocation materially increases the time of the Employee’s commute); or (iv) the Company’s material breach of any provision of this Agreement. The Employee must provide written notice of termination for Good Reason to the Company within thirty (30) days after the event constituting Good Reason. The Company shall have a period of thirty (30) days in which it may correct the act or failure to act that constitutes the grounds for Good Reason as set forth in the Employee’s notice of termination. If the Company does not correct the act or failure to act, the Employee may terminate her employment for Good Reason not later than (30) days following the end of the Company’s thirty (30)-day cure period. If the event constituting Good Reason is a material reduction in Salary described in subsection (i) above, the Employee’s Salary for purposes of the severance calculations shall be determined without regard to the material reduction described in subsection (i);

“Notice Period” means the period ending sixty (60) days from the date of written notice to terminate the Agreement;

“Term” means the period beginning on the Commencement Date and continuing through the Termination Date;

“Termination Date” means the date when the Employee ceases to be employed by the Company;

“Trade Secrets” means proprietary data and information relating to the business of the Company including, but not limited to, technical or nontechnical data, formulae, patterns, compilations, programs, devices, methods, techniques, drawings, processes, financial data, financial plans, product plans or lists of actual or potential customers or suppliers which (i) derives economic value, actual or

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potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy; and

(ii)    References to Sections are, unless otherwise stated, to sections of this Agreement; and

(iii)    Headings to Sections are for convenience only and shall not affect the construction or interpretation of this Agreement.

2.EMPLOYMENT

2.1    The Company hereby agrees to employ the Employee and the Employee hereby agrees to accept employment with the Company, on the terms and conditions more fully set forth herein.

2.2    The Employee’s employment will continue from the Commencement Date until it is terminated in accordance with the provisions of Section 5 below; provided, however, that the Employee’s employment is at all times on an at-will basis, and either the Employee or the Company may terminate this Agreement with or without Cause, for any reason or no reason, consistent with the provisions of Section 5 herein.

2.3    The Employee’s title shall be SVP, Principal Financial and Accounting Officer, and the Employee’s responsibilities shall include such duties and responsibilities that may be assigned consistent with such title.

2.4    The Employee will use reasonable best efforts to faithfully, diligently and efficiently perform such duties on behalf of the Company consistent with such office as may be assigned to the Employee from time to time by the Company. The Employee agrees to abide by the reasonable rules, regulations, instructions, personnel practices and policies of the Company, including without limitation BrightSphere’s Code of Ethics as well as its Insider Trading Policy, and any changes therein which may be adopted from time to time, all of which the Employee was first notified in writing. The Employee’s actions as an employee of the Company shall at all times be consistent with the interests of the Company. Under no circumstances will the Employee knowingly take any action contrary to the best interests of the Company.

3.PLACE OF WORK

The Employee shall primarily perform the duties assigned hereunder at the Company’s office presently located in Boston, Massachusetts, and is expected to travel to and work at other Company offices and other appropriate places within or outside the United States for reasonable periods of time as necessary; provided that such travel can be undertaken safely and is consistent with applicable guidance from federal, state or local authorities. Notwithstanding the foregoing, the Employee shall have the reasonable discretion to work remotely.

4.COMPENSATION AND BENEFITS

In consideration of the services performed by the Employee, and subject to performance of the Employee’s duties and responsibilities to the Company, the Company shall provide the Employee with the compensation and benefits described below:

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4.1    Compensation: The Employee’s salary shall be Four Hundred and Twenty-Five Thousand Dollars ($425,000) per annum (the “Salary”), payable in accordance with the Company’s normal payroll procedures and subject to applicable tax deductions and withholdings.

4.2     Bonus: The Employee is currently eligible to receive a target annual bonus of $700,000 (“Bonus”), subject to individual and Company performance, payable in cash and equity pursuant to the Company’s usual pay practice in effect at the time. Payment of the Bonus will be made no later than March 15th of the year following the year the bonus was earned.

4.3    Equity Plan. The Employee shall be eligible to participate in the Equity Plan or any other equity compensation plan that may be adopted, terminated and/or amended from time to time by the Compensation Committee. The issuance, vesting and exercise of any share awards subject hereto shall be approved by the Compensation Committee and shall be in accordance with the Equity Plan or the plan currently in effect. In order to be eligible for the award of any equity, the Employee also shall be required to execute any agreement and/or other document then in effect.

4.4    Benefits: Except as provided herein, the Employee shall be eligible to receive the various benefits offered by the Company to its employees, including holidays, vacation, medical, dental, disability and life insurance, and such other benefits as may be determined from time to time. These benefits may be modified or eliminated from time to time at the sole discretion of the Company. Where a particular benefit is subject to a formal plan, eligibility to participate in and receive the particular benefit shall be governed solely by the applicable plan document. Provided, however, should the Company have a severance plan in effect as of Employee’s Termination Date, Employee will not, subject to Section 5.1(D) be eligible for any payments under the plan unless otherwise approved by the Compensation Committee in its sole discretion.

4.5    Expenses: The Employee shall be entitled to reimbursement for reasonable out-of-pocket expenses incurred for the Company’s business (including travel and entertainment) in accordance with the policies, practices and procedures of the Company. The Employee shall comply with all Company written policies, practices and procedures, and all codes of ethics or business conduct applicable to the Employee’s position, as may be in effect from time to time and which have been made available to the Employee.

5.TERMINATION OF AGREEMENT/EMPLOYMENT

5.1    Payments Upon Termination. Either party may terminate the Employee’s employment in accordance with the provisions of this Agreement. In such event, this Section 5.1 shall set forth and govern the Company’s obligations to make any post-termination payments to the Employee on account of such termination.

(A)Termination for Cause: The Company may terminate this Agreement and the Employee’s employment for Cause immediately upon written notice. Upon termination of the Employee’s employment with the Company in accordance with this Section 5.1(A), Employee shall not be entitled to receive any other compensation or benefit, contingent or otherwise, except as otherwise required by applicable law.

(B)Termination with Notice: Either party may terminate this Agreement and the Employee’s employment for any reason by giving the other party not less than sixty (60) days’ advance notice in writing. If such notice is served by either party, the Company shall be entitled, in its sole and absolute discretion, to terminate the

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Employee’s employment at any time during the Notice Period and to provide payment in lieu of notice.

(C)Termination by the Employee with Notice:

i.The Company shall pay the Employee the Basic Termination Payments during the Notice Period; and

ii.In the event that the Company terminates this Agreement prior to the end of the Notice Period (without Cause), it shall pay the Employee an amount equivalent to her Salary and a taxable cash lump sum amount equivalent to the Company’s share of the cost of medical and dental benefits with respect to similarly situated active employees of the Company for the remainder of the Notice Period.

(D)By the Company without Cause or by Employee for Good Reason: In the event that the Company terminates this Agreement without Cause (including in such event that the Employee dies or is terminated as a result of Disability during the Notice Period relating to a termination by the Company without Cause), or the Employee terminates this Agreement for Good Reason, the Company will pay the Employee as follows:

i.The Company shall pay the Employee the Basic Termination Payments during the Notice Period;

ii.In the event that the Company terminates this Agreement prior to the end of the Notice Period (without Cause), it shall pay the Employee an amount equivalent to her Salary for the remainder of the Notice Period in one lump sum less applicable taxes and withholdings, if any, under state and federal law. In addition, to the extent the Employee is covered by the Company’s medical, dental, and vision insurance plans and elects within the appropriate time period to continue coverage under COBRA, the Company will pay for the Employee’s COBRA premiums for the remainder of the Notice Period;

iii.A lump sum cash payment equal to the greater of (a) the sum of (x) Employee’s Salary at the rate in effect immediately before the Termination Date, for a period of twelve (12) months, reduced by any amount of Salary paid to the Employee pursuant to clause (ii) above and (y) a lump sum cash payment equal to the most recently paid Bonus, or (b) $1,125,000;

iv.In addition, to the extent the Employee is covered by the Company’s medical, dental, and vision insurance plans and elects within the appropriate time period to extend her coverage under COBRA, the Company will pay for the Employee’s COBRA premiums for 12 months, reduced by any amount of COBRA premiums paid to or for the Employee pursuant to clause (ii) above following the termination of this Agreement prior to the end of the Notice Period;

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v.A cash bonus for the year in which the Termination Date occurs equal to the greater of (a) the most recently paid Bonus or (b) $700,000, in each case pro-rated based on the number of days worked during the termination year through the end of the Notice Period (without regard to whether pay is provided in lieu of all or a portion of the Notice Period); provided, however, if the annual bonus earned for the year prior to the year in which the Termination Date occurs has not yet been paid, the amount payable pursuant to this clause (v) shall be an amount equal to the greater of $700,000 or the most recently paid Bonus; and

vi.Accelerated vesting of the Employee’s restricted stock and restricted stock unit awards such that all unvested shares shall be deemed vested as of the Termination Date. Notwithstanding the foregoing, all of the awards will remain subject to forfeiture pursuant to the Company’s Claw-Back Policy or in the event of a breach by the Employee of any restrictive covenants under this Agreement or under any other agreement with the Company.

(E)Resignation by the Employee Prior to Expiration of the Notice Period: Should the Employee voluntarily resign prior to the expiration of a Notice Period (regardless of the party providing the notice), the Company shall pay the Employee the Basic Termination Payments and the Employee shall not be entitled to receive any other compensation or benefit, contingent or otherwise, except as otherwise required by applicable law.

(F)Termination upon the Employee’s Death or Disability. In the event that the Employee dies during the Term or the Company terminates her employment as a result of Disability (other than during the Notice Period as set forth in Section 5.1(D) above), the Company shall pay the Employee or her estate the following:

1.The Basic Termination Payments; and

2.With respect to a termination due to the Employee’s Disability, the benefit described in Section 5.1(D)(iv);

3.Continuation of the Employee’s Salary for some period of time following the Notice Period, at the discretion of the Compensation Committee;

4.A cash bonus, at the discretion of the Compensation Committee; and

5.Accelerated vesting of the Employee’s restricted stock and restricted stock unit awards such that all unvested shares shall be deemed vested as of the Termination Date. Notwithstanding the foregoing, all of the awards will remain subject to forfeiture pursuant to the Company’s Claw-Back Policy or in the event of a breach by the Employee of any restrictive covenants under this Agreement or under any other agreement with the Company.

(G)Release/Post-Termination Payments: The receipt of the compensation and benefits provided in this Section 5.1 to the Employee shall be in full and final satisfaction

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of the Employee’s rights and claims under this Agreement (or otherwise). Payment of any post-termination compensation or benefits to the Employee in excess of the Basic Termination Payments shall be in lieu of severance. Notwithstanding anything in this Section 5, if the Employee wishes to receive any portion of the compensation and benefits provided in this Section 5.1 in excess of the Basic Termination Benefits, the Employee (or her estate, in the event of her death) will be required to timely execute and deliver to the Company, and not revoke, a separation agreement substantially in the form provided by the Company (the “Separation Agreement”). The Separation Agreement shall include a complete customary release of claims against the Company and its directors, officers, employees and agents (the “Release”).  The Employee shall execute the Separation Agreement and deliver it to the Company within forty-five (45) days following the Termination Date. For a period of seven (7) days following the date the Employee executes the Release, Employee may revoke the Release by delivering a written statement to the Company.To the extent applicable, the Separation Agreement is intended to constitute an agreement made in connection with the Employee’s cessation of or separation from employment that is exempt from the definition of “noncompetition agreement,” within the meaning of Section 24L(a) of Chapter 149 of the General Laws of the Commonwealth of Massachusetts.

5.2    Resignations: Upon termination of the Employee’s employment, the Employee will also automatically resign, and will automatically be deemed to have resigned, from all positions with the Company (including any board membership positions), unless otherwise provided by the Board. The Employee hereby grants the Company an irrevocable power of attorney (with right of substitution) to take actions in the Employee’s name to effectuate such resignations.

5.3    Upon termination (or suspension) of the Employee’s employment or this Agreement, regardless of the reason, the Employee shall deliver to the Company all books, documents, materials described in Section 6, and all credit cards, keys and other property of the business of the Company which may be in the Employee’s possession, custody or control.

6.RESTRICTIVE COVENANTS

6.1    Company Confidential Information, Trade Secrets and Intellectual Property.

(A)The Employee acknowledges and agrees that during employment with the Company, the Employee will acquire Confidential Information and Trade Secrets in relation to the Company and that through dealing closely with customers and clients the Employee will form close connections with and influence over those customers and clients. The Employee acknowledges and agrees that the Confidential Information, Trade Secrets and business relationships of the Company are necessary for the Company to continue to operate its business. The Employee further acknowledges and agrees that the Company has a reasonable, necessary and legitimate business interest in protecting its Confidential Information, Trade Secrets and business relationships and that the following covenants are reasonable and necessary to protect such business interests and are given for good and valuable consideration. Accordingly, the Employee will comply with the policies and procedures of the Company for protecting Confidential Information and Trade Secrets and not use, reproduce, distribute, disclose or otherwise disseminate the Confidential Information and Trade Secrets or any physical embodiments thereof other than as required by applicable law or for the proper performance of her duties and responsibilities to the Company, and may in no event take any action causing, or fail to take the action necessary in order to prevent, her disclosure of any Confidential

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Information and Trade Secrets disclosed to or developed by the Employee to lose its character or cease to qualify as Confidential Information or Trade Secrets.

(B)Nothing in this Agreement prohibits or limits the Employee from initiating communications directly with, responding to any inquiry from, volunteering information to, or providing testimony before, the Securities and Exchange Commission, the Department of Justice, FINRA, any other self-regulatory organization or any other governmental, law enforcement, or regulatory authority, regarding this agreement and its underlying facts and circumstances, or any reporting of, investigation into, or proceeding regarding suspected violations of law, and that the Employee is not required to advise or seek permission from the Company before engaging in any such activity; provided, however, in connection with any such activity, the Employee must inform such authority that the information the Employee is providing is confidential.

(C)The Company shall not seek to hold the Employee criminally or civilly liable under any Federal or State trade secret law for the disclosure of a Trade Secret that is made in confidence to a Federal, State, or local government official or to an attorney solely for the purpose of reporting or investigating a suspected violation of law. In addition, the Company shall not seek to hold the Employee criminally or civilly liable under any Federal or State trade secret law for the disclosure of a Trade Secret that is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Finally, if the Employee files a lawsuit for retaliation for reporting a suspected violation of law, the Employee may disclose the Trade Secret to her attorney and use the trade secret information in the court proceeding so long as the Employee files any document containing the Trade Secret under seal and does not disclose the Trade Secret, except pursuant to court order.

(D)The Employee hereby assigns and transfers to the Company any and all rights, title and interest in and to all intellectual property existing now or in the future, including, without limitation, patent rights, copyrights, the right to prepare derivative works, trade secret rights, sui generis database rights, moral and artist rights, and all other intellectual and industrial property rights of any sort in the United States and throughout the world now or hereafter known relating to any and all research, information, client lists, and all other investment, technical and research data any and all inventions (whether or not patentable), works of authorship, designs, trademarks, tradenames, domain names, processes, business plans, financial models, methods, know-how, ideas and information made, conceived, developed or reduced to practice, in whole or in part, by the Employee or on the Employee’s behalf for the benefit of the Company (“Company Intellectual Property”). With regards to any rights, title or interest that cannot be assigned pursuant to the foregoing provision, the Employee agrees to assign and transfer without further consideration any and all such rights, title and interest to the Company and to take any and all such further actions as are appropriate or necessary to accomplish the foregoing and hereby irrevocably appoints the Company to act as the Employee’s attorney for purposes of perfecting the Company’s interest in such Company Intellectual Property.

6.2    Noncompetition. The Employee hereby agrees that all times during the Term, the Employee shall not whether alone or jointly, or as a partner, manager, member, director, officer, employee, consultant, representative, agent or joint venturer of any other party, directly or indirectly join, finance, invest in, lend to, be employed by, consult for, or otherwise participate in, or be connected with, any business that competes with the Company anywhere the Company does business and/or render services; provided however, that this limitation shall not apply to (1) any equity interest that Employee has in a company whose stock is publicly traded so long as Employee does not own more than 5% of such equity.

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6.3    Non-Solicitation. The Employee hereby agrees that all times during the Term, the Notice Period, and for a period of twelve (12) months after expiration of the later of the Notice Period or the Termination Date, the Employee shall not whether alone or jointly, or as a partner, manager, member, director, officer, employee, consultant, representative, agent or joint venturer of any other party, directly or indirectly:

(A)Solicit, induce or in any manner attempt to solicit or induce any person employed by or acting as a director, officer or agent of, or consultant to the Company to leave such position and become employed or associated with any other entity or business; or

(B)Employ or attempt to employ or negotiate or arrange the employment or engagement by any other person, of any person who to the Employee’s knowledge was within six months prior to the Notice Period, a director or senior employee of the Company who was personally known to the Employee; or

(C)Solicit, interfere with, disrupt or attempt to disrupt any relationship, contractual or otherwise, between the Company and any of its reasonably known respective clients, customers, partners or joint venturers.

6.4    The Employee agrees that the duration and geographic scope of the restrictive provisions set forth in Section 6 herein are reasonable. In the event that any court determines that the duration or geographic scope, or both, are unreasonable and that such provision is to that extent unenforceable, the Employee agrees that the provision shall remain in full force and effect for the greatest time period and in the greatest area that would not render it unenforceable. The Employee also agrees that damages are an inadequate remedy for any breach of the restrictive provisions in this Agreement and that the Company shall, whether or not it is pursuing any potential remedies at law, be entitled to equitable relief in the form of preliminary and permanent injunctions without bond or other security upon any actual or threatened breach of the restrictive covenants herein.

6.5    The Employee shall comply as is reasonable with (a) every applicable rule of law in the United States of which Employee knows or reasonably should have known and (b) the rules and regulations of the regulatory authorities of the United States insofar as the same are applicable to employment hereunder and of which Employee knows or reasonably should have known, and (c) every regulation of the Company with respect to insider trading, of which the Employee is first notified in writing.

6.6    Subject to Sections 6.1(B) and (C), the Employee shall not during the Term, the Notice Period and at all times following the Termination Date:

(A)Divulge or communicate to any person or persons any Confidential Information (except to employees of, or to attorneys, accountants or other professionals engaged by, the Company with a need to know such information);

(B)Use any Confidential Information for the Employee’s own purposes or for any purposes other than those of the Company; or

(C)Through any failure to exercise all reasonable due care and diligence cause any unauthorized disclosure of any Confidential Information.

6.7    All notes, memoranda, records, lists of customers and suppliers and employees, correspondence, documents, computer and other discs and tapes, data listing, codes, designs and

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drawings and other documents and material whatsoever (whether made or created by the Employee or otherwise) belonging to the business of the Company (and any copies of the same) (a) shall be and remain the property of the Company, and (b) shall be delivered by the Employee to the Company from time to time on demand and in any event on the termination of this Agreement.

6.8    Subject to Sections 6.1(B) and (C), the Employee shall not at any time during the Term, Notice Period, and all times following the Termination Date make any untrue, misleading or disparaging statement with respect to the Company (or any of its directors, officers, employees or agents). Nor shall the Employee attribute to himself the investment performance of any single investment or group of investments managed by the Company or claim responsibility for having sourced, recommended, or made any such investment or group of investments. The Company shall use its commercially reasonable best efforts not to make, shall not authorize, and shall instruct its directors and executive officers not to make, any untrue, misleading or disparaging statements about the Employee at any time during the Term, Notice Period, and at all times following the Termination Date. Notwithstanding anything in the paragraph to the contrary, this paragraph is not intended to prohibit the Employee from regular and customary critique, evaluation, or discipline of any officers, directors, employees or agents in the course of the Employee’s duties for the Company.

6.9    At no time after the Termination Date shall the Employee directly or indirectly represent himself as being interested in or employed by or in any way connected with the Company, other than as a former employee or officer of the Company. After the Termination Date, Employee shall not in the course of carrying on any trade or business claim, represent or otherwise indicate any present association with the Company for the purpose of carrying on or retaining any business, represent or otherwise indicate any past association with the Company, other than as a former employee or officer of the Company.

6.10    From and after the Termination Date, the Employee agrees to cooperate in the transition of her duties and in the business affairs of the Company as may be reasonably requested by the Company. From and after the Termination Date, the Employee shall cooperate reasonably with the Company in the defense or prosecution of any claims or actions then in existence or that may be brought or threatened in the future against or on behalf of the Company, including any claims or actions against its officers, directors, agents and employees. The Employee’s cooperation in connection with such matters, actions, and claims shall include, without limitation, being available (at mutually agreeable times and locations, which agreement shall not be unreasonably withheld by the Employee, and without unreasonably interfering with her other professional obligations) to meet with the Company and its legal or other designated advisors, regarding any matters in which he has been involved; to prepare for any proceeding (including, without limitation, depositions, consultation, discovery, or trial); to provide truthful affidavits; to assist with any audit, inspection, proceeding, or other inquiry; and to act as a witness to provide truthful testimony in connection with any litigation or other legal proceeding affecting the Company. The Employee’s cooperation shall be provided at mutually convenient times and in a mutually convenient manner. The Company shall reimburse the Employee’s reasonable expenses incurred under this Section 6.10, including without limitation, any attorneys’ fees incurred in connection with such cooperation.

6.11    The obligations of the Employee under this Section 6 shall survive termination of this Agreement to the extent provided in each sub-section. Further, the provisions of this Section 6 shall continue to apply with full force and effect should the Employee transfer to or otherwise become employed by any Company entity, or be promoted or reassigned to positions other than that held by the Employee as of the Effective Date of this Agreement. The Company shall have the right to communicate the Employee’s ongoing obligations hereunder to any entity or

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individual with whom the Employee becomes employed by or otherwise engaged following termination of employment with the Company.

7.GENERAL

7.1    This Agreement shall be deemed to have been made in the Commonwealth of Massachusetts, shall take effect as an instrument under seal, and the validity, interpretation and performance of this Agreement shall be governed by, and construed in accordance with, the internal law of Commonwealth of Massachusetts, without giving effect to conflict of law principles. Both parties also agree that any action, demand, claim or counterclaim relating to the Employee’s employment, any termination of employment and/or the terms and provisions of this Agreement or to its alleged breach by either party, shall be commenced in Massachusetts as set forth in Section 8 below. Both parties further acknowledge that venue shall exclusively lie in Massachusetts and that material witnesses and documents may be located in Massachusetts.

7.2    The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement. This Agreement contains the entire agreement of the parties relating to the subject matter hereof and supersedes all oral or written employment, consulting, change of control or similar agreements between the Employee, on the one hand, and the Company, on the other hand (including the Employment Agreement between the Employee and BrightSphere Inc. dated April 15, 2020), except as otherwise set forth herein. This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors and legal representatives. This Agreement is binding upon and inures to the benefit of both parties and their respective successors and assigns, including any corporation with which or into which the Company may be merged or which may succeed to its assets or business, although the obligations of the Employee are personal and may be performed only by her.

7.3    All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by overnight carrier, registered or certified mail, return receipt requested, postage prepaid, or via electronic mail addressed as follows:

If to the Employee:    Christina Wiater
At the notice address most recently maintained on file with the Company’s Human Resource department

If to the Company:     BrightSphere Inc.
200 State Street, 13th Floor
Boston, Massachusetts 02109
Attn: Chief Legal Officer

or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when delivered to the addressee.

7.4    The Company shall indemnify the Employee to the full extent permitted by applicable law and shall maintain reasonable insurance coverage (including but not limited to directors’ and officers’ liability insurance coverage) with respect to the Employee’s performance of her duties and responsibilities.

7.5    All payments under this Agreement shall be made subject to applicable tax withholding, and the Company shall withhold from any payments under this Agreement all federal, state and local taxes as the Company is required to withhold pursuant to any law or

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governmental rule or regulation. The Employee shall bear all expense of, and be solely responsible for, all federal, state and local taxes due with respect to any payment received under this Agreement.

7.6    In the event of a change in ownership or control of the Company under Section 280G of the Code, if it shall be determined that any payment or distribution in the nature of compensation (within the meaning of section 280G(b)(2) of the Code) to or for the benefit of the Employee, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise (a “Payment”), would constitute an “excess parachute payment” within the meaning of Section 280G of the Code, the aggregate present value of the Payments shall be reduced (but not below zero) to the Reduced Amount (defined below) if and only if the Accounting Firm (described below) determines that the reduction will provide the Employee with a greater net after-tax benefit than would no reduction. No reduction shall be made unless the reduction would provide the Employee with a greater net after-tax benefit. The determinations under this Section 7.6 shall be made as follows:

(A)The “Reduced Amount” shall be an amount expressed in present value which maximizes the aggregate present value of Payments under this Agreement without causing any Payment under this Agreement to be subject to the Excise Tax (defined below), determined in accordance with Section 280G(d)(4) of the Code. The term “Excise Tax” means the excise tax imposed under Section 4999 of the Code, together with any interest or penalties imposed with respect to such excise tax.

(B)Payments under this Agreement shall be reduced on a nondiscretionary basis in such a way as to minimize the reduction in the economic value deliverable to the Employee. Where more than one Payment has the same value for this purpose and they are payable at different times, they will be reduced on a pro rata basis. Only amounts payable under this Agreement shall be reduced pursuant to this Section 7.6.

(C)All determinations to be made under this Section 7.6 shall be made by an independent certified public accounting firm selected by the Company and agreed to by the Employee immediately prior to the change-in-ownership or -control transaction (the “Accounting Firm”). The Accounting Firm shall provide its determinations and any supporting calculations both to the Company and the Employee within ten (10) days of the transaction. Any such determination by the Accounting Firm shall be binding upon the Company and the Employee. All of the fees and expenses of the Accounting Firm in performing the determinations referred to in this Section 7.6 shall be borne solely by the Company.

7.7    The Employee’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Employee or the Company may have hereunder shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

8.ARBITRATION

(A)Except as provided herein, any and all disputes that arise out of or relate to the terms of this Agreement shall be resolved through final and binding arbitration. SUCH ARBITRATION SHALL BE IN LIEU OF ANY TRIAL BEFORE A JUDGE AND/OR JURY, AND THE EXECUTIVE AND THE COMPANY EXPRESSLY WAIVE ALL RIGHTS TO HAVE SUCH DISPUTES RESOLVED VIA TRIAL BEFORE A JUDGE AND/OR JURY. Such disputes shall include, without limitation, claims for breach of contract or of the covenant of good faith and fair dealing, claims of

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discrimination, and claims under any federal, state or local law or regulation now in existence or hereinafter enacted and as amended from time to time concerning in any way the Employee’s employment with the Company or its termination. The only claims not covered by this requirement to arbitrate disputes, which shall instead be resolved pursuant to applicable law in a court of competent jurisdiction based in Massachusetts, are: (i) claims for benefits under the unemployment insurance benefits; (ii) claims for workers’ compensation benefits under any of the Company’s workers’ compensation insurance policy or fund; (iii) claims under the National Labor Relations Act; (iv) claims brought by the Company for alleged violations of Section 6 of this Agreement; and (v) claims that may not be arbitrated as a matter of law.

(B)Arbitration will be conducted by and before JAMS in Boston, Massachusetts in accordance with the JAMS Employment Arbitration Rules and Procedures (the “JAMS Rules”). To the extent that anything in this arbitration section conflicts with any arbitration procedures required by applicable law, the arbitration procedures required by applicable law shall govern.

(C)During the course of arbitration, the Company will bear the cost of the arbitrator’s fee. The arbitrator will not have authority to award attorneys’ fees unless a statute or contract at issue in the dispute authorizes the award of attorneys’ fees to the prevailing party. In such case, the arbitrator shall have the authority to make an award of attorneys’ fees as required or permitted by the applicable statute or contract.

(D)The arbitrator shall issue a written award that sets forth the essential findings of fact and conclusions of law on which the award is based. The arbitrator shall have the authority to award any relief authorized by law in connection with the asserted claims or disputes. The arbitrator’s award shall be subject to correction, confirmation, or vacation, as provided by applicable law setting forth the standard of judicial review of arbitration awards. Judgment upon the arbitrator’s award may be entered in any court having jurisdiction thereof.

9.SECTION 409A COMPLIANCE

(A)General. It is intended that compensation paid or delivered to the Employee pursuant to this Agreement is either paid in compliance with, or is exempt from, Section 409A of the Code and the regulations promulgated thereunder (“Section 409A”). If the Employee notifies the Company (with specificity as to the reason therefor) that he believes that any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause him to incur any additional tax or interest under Section 409A and the Company concurs with such belief or the Company independently makes such determination, the Company shall, after consultation with the Employee, to the extent legally permitted and to the extent it is possible to timely reform the provision to avoid taxation under Section 409A, reform such provision to attempt to comply with Section 409A through good faith modifications to the minimum extent reasonably appropriate to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to both the Employee and the Company of the applicable provision without violating the provisions of Section 409A but in any case Employee hereby agrees that all personal income taxes on her compensation under this Agreement and all penalties and interest with respect to such personal income taxes, if any, are her own responsibility. In no event shall the Company have any liability relating to the failure or alleged failure of any payment or benefit under

14

this Agreement to comply with, or be exempt from, the requirements of Section 409A, or any similar Treasury regulations or IRS rules or regulations that replace or supersede Treasury Regulation Section 1.409A after the Effective Date and that relate to the same or similar subject matter as Treasury Regulation Section 1.409A.

(B)Amounts Payable On Account of Termination: To the extent necessary to comply with Section 409A, for the purposes of determining when amounts subject to Section 409A that are payable upon Employee’s termination of employment under this Agreement will be paid, “termination of employment” or words of similar import, as used in this Agreement, shall be construed as the date that Employee first incurs a “separation from service” within the meaning of Section 409A.

(C)Reimbursement: Any taxable reimbursement of business or other expenses as specified under this Agreement shall be subject to the following conditions: (A) the expenses eligible for reimbursement in one taxable year shall not affect the expenses eligible for reimbursement in any other taxable year; (B) the reimbursement of an eligible expense shall be made no later than the end of the year after the year in which such expense was incurred; (C) the right to reimbursement shall not be subject to liquidation or exchange for another benefit; and (D) in accordance with the policies, practices and procedures of the Company.

(D)Specified Employees: If the Employee is deemed on the date of termination to be a “specified employee” within the meaning of that term under Section 409A(a)(2)(B) of the Code, then with regard to any payment that is considered deferred compensation subject to Section 409A payable on account of a “separation from service,” such payment or benefit shall be made, or provided at the date which is the earlier of (i) the expiration of the six (6)-month period measured from the date of such “separation from service”, and (ii) the date of the Employee’s death (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Employee in a lump sum, with interest thereon calculated at the long-term applicable federal rate (annual compounding) under Section 1274(d) of the Code in effect on the date of termination of employment, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.

(E)Interpretative Rules: In applying Section 409A to amounts paid pursuant to this Agreement, any right to a series of installment payments under this Agreement shall be treated as a right to a series of separate payments.

10.ACKNOWLEDGMENTS

    The Employee acknowledges that: (i) the Employee received this Agreement at least ten (10) business days prior to the date on which Section 6.2 is to be effective; (ii) the Employee has the right to consult with counsel prior to signing this Agreement; and (iii) the Employee has had a full and adequate opportunity to read, understand and discuss with the Employee’s advisors, including legal counsel, the terms and conditions contained in this Agreement prior to signing hereunder.

15

IN WITNESS WHEREOF this Agreement has been executed as of May 4, 2023.

EMPLOYEE

/s/ Christina Wiater    

Christina Wiater

BRIGHTSPHERE INC.


/s/ Suren Rana    

By: Suren Rana

Its: President and CEO

EX-31.1

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Suren Rana, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of BrightSphere Investment Group Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 8, 2023

/s/ Suren Rana

Suren Rana

President and Chief Executive Officer

(principal executive officer)

EX-31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Christina Wiater, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of BrightSphere Investment Group Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 8, 2023

/s/ Christina Wiater

Christina Wiater

Senior Vice President and Principal Financial Officer

(principal financial officer and principal accounting officer)

EX-32.1

Exhibit 32.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Suren Rana, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge, the Quarterly Report on Form 10-Q of BrightSphere Investment Group Inc. for the quarterly period ended March 31, 2023 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in such Report fairly presents in all material respects the financial condition and results of operations of BrightSphere Investment Group Inc. for the periods covered by the Report. The foregoing certification is being furnished to the Securities and Exchange Commission as part of the Report. A signed original of this statement has been provided to BrightSphere Investment Group Inc. and will be retained by BrightSphere Investment Group Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

Date:	May 8, 2023	/s/ Suren Rana
		Name: Suren Rana
		Title: President and Chief Executive Officer
		(principal executive officer)

EX-32.2

Exhibit 32.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Christina Wiater, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge, the Quarterly Report on Form 10-Q of BrightSphere Investment Group Inc. for the quarterly period ended March 31, 2023 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in such Report fairly presents in all material respects the financial condition and results of operations of BrightSphere Investment Group Inc. for the periods covered by the Report. The foregoing certification is being furnished to the Securities and Exchange Commission as part of the Report. A signed original of this statement has been provided to BrightSphere Investment Group Inc. and will be retained by BrightSphere Investment Group Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

Date:	May 8, 2023	/s/ Christina Wiater
		Name: Christina Wiater
		Title: Senior Vice President and Principal Financial Officer
		(principal financial officer and principal accounting officer)

XML

Cover - shares	3 Months Ended
	Mar. 31, 2023	May 04, 2023
Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2023
Document Transition Report	false
Entity File Number	001-38979
Entity Registrant Name	BRIGHTSPHEREInvestment Group Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	47-1121020
Entity Address, Address Line One	200 State Street, FL 13
Entity Address, City or Town	Boston,
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02109
City Area Code	617
Local Phone Number	369-7300
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		41,464,175
Entity Central Index Key	0001748824
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Amendment Flag	false
Common Stock
Entity Information [Line Items]
Title of 12(b) Security	Common stock, par value $0.001 per share
Trading Symbol	BSIG
Security Exchange Name	NYSE
4.800% Notes due 2026
Entity Information [Line Items]
Title of 12(b) Security	4.800% Notes due 2026
Trading Symbol	BSIG 26
Security Exchange Name	NYSE

XML

Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Assets
Investments	$ 52.7	$ 50.3
Total assets	546.0	518.7
Liabilities and stockholders’ equity
Operating lease liabilities	77.0
Total liabilities	554.3	540.3
Commitments and contingencies
Equity:
Total equity	(8.3)	(21.6)
Total liabilities and equity	546.0	518.7
Consolidated Entity Excluding Consolidated Funds
Assets
Cash and cash equivalents	154.1	108.4
Investment advisory fees receivable	99.9	122.5
Income taxes receivable	0.0	2.0
Fixed assets, net	48.4	47.7
Right of use assets	61.3	59.9
Investments	49.9	48.4
Goodwill	20.3	20.3
Other assets	27.3	27.7
Deferred tax assets	65.9	64.7
Liabilities and stockholders’ equity
Accounts payable and accrued expenses	20.4	31.0
Accrued incentive compensation	24.0	92.5
Other compensation liabilities	60.1	59.3
Accrued income taxes	8.3	4.6
Operating lease liabilities	77.0	75.8
Other liabilities	0.8	1.1
Revolving credit facility	87.0	0.0
Third party borrowings	273.6	273.5
Equity:
Common stock (par value $0.001; 41,464,175 and 41,435,087 shares, respectively, issued)	0.0	0.0
Additional paid-in capital	1.4	1.5
Retained deficit	(0.8)	(12.5)
Accumulated other comprehensive loss	(9.3)	(10.6)
Consolidated Funds
Assets
Investments	2.8	1.9
Other assets	3.5	2.4
Cash and cash equivalents, restricted	12.6	12.8
Liabilities and stockholders’ equity
Accounts payable and accrued expenses	0.5	0.3
Derivative liabilities at fair value	2.6	2.2
Redeemable non-controlling interests in consolidated Funds	$ 0.4	$ 0.0

XML

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, issued (in shares)	41,464,175	41,435,087

XML

Condensed Consolidated Statements of Operations - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Revenue:
Total revenue	$ 91.8	$ 112.2
Operating expenses:
Compensation and benefits	49.1	46.8
General and administrative expense	18.4	16.9
Depreciation and amortization	3.8	5.3
Total operating expenses	72.0	69.0
Operating income	19.8	43.2
Non-operating income and (expense):
Investment income (loss)	0.3	(0.1)
Interest income	1.1	0.0
Interest expense	(4.9)	(6.5)
Loss on extinguishment of debt	0.0	(3.2)
Total non-operating income (loss)	(2.7)	(9.8)
Income before income taxes	17.1	33.4
Income tax expense	5.1	9.6
Net income	12.0	23.8
Net income attributable to non-controlling interests in consolidated Funds	0.0	0.0
Net income attributable to controlling interests	$ 12.0	$ 23.8
Earnings per share (basic) attributable to controlling interests (in dollars per share)	$ 0.29	$ 0.54
Earnings per share (diluted) attributable to controlling interests (in dollars per share)	$ 0.28	$ 0.53
Weighted average common stock outstanding (in shares)	41,444,200	43,969,713
Weighted average diluted common stock outstanding (in shares)	42,710,577	45,327,390
Consolidated Funds
Revenue:
Total revenue	$ 0.7	$ 0.0
Operating expenses:
Total operating expenses	0.7	0.0
Non-operating income and (expense):
Net consolidated Funds’ investment gains	0.8	0.0
Management fees
Revenue:
Revenue:	90.6	102.2
Performance fees
Revenue:
Revenue:	$ 0.5	$ 10.0

XML

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Statement of Comprehensive Income [Abstract]
Net income	$ 12.0	$ 23.8
Other comprehensive income (loss):
Amortization related to derivative securities, net of tax	0.6	1.6
Foreign currency translation adjustment	0.7	(0.7)
Total other comprehensive income	1.3	0.9
Comprehensive income attributable to non-controlling interests in consolidated Funds	0.0	0.0
Total comprehensive income attributable to controlling interests	$ 13.3	$ 24.7

XML

Condensed Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Millions	Total	Consolidated Entity Excluding Consolidated Funds Total stockholders’ equity	Consolidated Entity Excluding Consolidated Funds Common Stock	Consolidated Entity Excluding Consolidated Funds Additional paid-in capital	Consolidated Entity Excluding Consolidated Funds Retained earnings (deficit)	Consolidated Entity Excluding Consolidated Funds Accumulated other comprehensive income (loss)	Consolidated Funds
Beginning balance (in shares) at Dec. 31, 2021			45,400,000
Beginning balance at Dec. 31, 2021		$ (17.6)	$ 0.0	$ 0.0	$ (6.8)	$ (10.8)
Increase (Decrease) in Stockholders' Equity
Issuance of common stock (in shares)			200,000
Repurchase of common stock (in shares)	(4,147,450)		(4,200,000)
Repurchase of common stock		(103.2)			(103.2)
Equity-based compensation		0.9		0.9
Foreign currency translation adjustment	$ (0.7)	(0.7)				(0.7)
Amortization related to derivatives securities, net of tax		1.6				1.6
Withholding tax related to stock option exercise and restricted stock vesting	(2.3)	(2.3)		(0.9)	(1.4)
Dividends		(0.4)			(0.4)
Net income		23.8			23.8
Ending balance (in shares) at Mar. 31, 2022			41,400,000
Ending balance at Mar. 31, 2022		(97.9)	$ 0.0	0.0	(88.0)	(9.9)
Beginning balance at Dec. 31, 2021							$ 0.0
Ending balance at Mar. 31, 2022							0.0
Beginning balance at Dec. 31, 2021	(17.6)
Increase (Decrease) in total equity and redeemable non-controlling interest in consolidated Funds
Issuance of common stock	0.0
Repurchase of common stock	(103.2)
Equity-based compensation	0.9
Foreign currency translation adjustment	(0.7)
Amortization related to derivative securities, net of tax	1.6
Dividends ($0.01 per share)	(0.4)
Net income	23.8
Ending balance at Mar. 31, 2022	$ (97.9)
Beginning balance (in shares) at Dec. 31, 2022			41,400,000
Beginning balance at Dec. 31, 2022		(21.6)	$ 0.0	1.5	(12.5)	(10.6)
Increase (Decrease) in Stockholders' Equity
Issuance of common stock (in shares)			100,000
Repurchase of common stock (in shares)	0
Equity-based compensation		0.2		0.2
Foreign currency translation adjustment	$ 0.7	0.7				0.7
Amortization related to derivatives securities, net of tax		0.6				0.6
Withholding tax related to stock option exercise and restricted stock vesting	(0.3)	(0.3)		(0.3)
Dividends		(0.3)			(0.3)
Net income		12.0			12.0
Ending balance (in shares) at Mar. 31, 2023			41,500,000
Ending balance at Mar. 31, 2023		$ (8.7)	$ 0.0	$ 1.4	$ (0.8)	$ (9.3)
Beginning balance at Dec. 31, 2022							0.0
Increase (Decrease) in redeemable non-controlling interest in consolidated Funds
Net capital contributions	0.4						0.4
Ending balance at Mar. 31, 2023							0.4
Beginning balance at Dec. 31, 2022	(21.6)
Increase (Decrease) in total equity and redeemable non-controlling interest in consolidated Funds
Issuance of common stock	0.0
Net capital contributions	0.4						$ 0.4
Equity-based compensation	0.2
Foreign currency translation adjustment	0.7
Amortization related to derivative securities, net of tax	0.6
Dividends ($0.01 per share)	(0.3)
Net income	12.0
Ending balance at Mar. 31, 2023	$ (8.3)

XML

Condensed Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) - $ / shares	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Statement of Stockholders' Equity [Abstract]
Dividends (in dollars per share)	$ 0.01	$ 0.01

XML

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash flows from operating activities:
Net income	$ 12.0	$ 23.8
Less: Net (income) loss attributable to redeemable non-controlling interests in consolidated Funds	0.0	0.0
Adjustments to reconcile net income to net cash flows from operating activities:
Loss on extinguishment of debt	0.0	3.2
Depreciation and other amortization	3.8	5.3
Amortization of debt-related costs	1.0	2.7
Amortization and revaluation of non-cash compensation awards	1.2	(4.2)
Deferred income taxes	(1.0)	0.8
(Gains) losses on other investments	(1.1)	1.2
Changes in operating assets and liabilities:
Decrease in investment advisory fees receivable	22.6	52.7
Decrease in other receivables, prepayments, deposits and other assets	0.8	0.4
Decrease in accrued incentive compensation, operating lease liabilities and other liabilities	(68.8)	(92.2)
Decrease in accounts payable, accrued expenses and accrued income taxes	(4.8)	(8.1)
Adjustments to reconcile net income (loss) attributable to redeemable non-controlling interests of consolidated Funds to net cash flows from operating activities:
Total net cash flows from operating activities	(34.9)	(14.4)
Cash flows from investing activities:
Additions of fixed assets	(4.5)	(4.0)
Purchase of investment securities	(2.6)	(4.8)
Sale of investment securities	1.5	4.8
Total net cash flows from investing activities	(5.6)	(4.0)
Cash flows from financing activities:
Proceeds from revolving credit facility	100.0	125.0
Repayment of third party borrowings and revolving credit facility	(13.0)	(162.0)
Payment for debt issuance costs	0.0	(0.9)
Payment to OM plc for co-investment redemptions	(0.4)	(1.1)
Dividends paid to stockholders	(0.5)	(0.3)
Dividends paid to related parties	(0.3)	(0.1)
Repurchases of common stock	0.0	(103.2)
Withholding tax payments related to stock option exercise and restricted stock vesting	(0.3)	(2.3)
Cash flows from financing activities of consolidated Funds
Total net cash flows from financing activities	85.9	(144.9)
Effect of foreign exchange rate changes on cash and cash equivalents	0.1	0.0
Net increase (decrease) in cash and cash equivalents	45.5	(163.3)
Cash and cash equivalents at beginning of period	121.2	252.1
Cash and cash equivalents at end of period	166.7	88.8
Supplemental disclosure of cash flow information:
Interest paid	7.1	8.0
Income taxes paid	0.8	3.0
Consolidated Funds
Adjustments to reconcile net income (loss) attributable to redeemable non-controlling interests of consolidated Funds to net cash flows from operating activities:
Purchase of investments	(0.1)	0.0
Sale of investments	0.4	0.0
(Increase) decrease in receivables and other assets	(1.0)	0.0
Increase in accounts payable and other liabilities	0.1	0.0
Total net cash flows from operating activities	(0.6)	0.0
Cash flows from financing activities of consolidated Funds
Redeemable non-controlling interest capital raised	0.4	0.0
Consolidated Entity Excluding Consolidated Funds
Adjustments to reconcile net income (loss) attributable to redeemable non-controlling interests of consolidated Funds to net cash flows from operating activities:
Total net cash flows from operating activities	$ (34.3)	$ (14.4)

XML

Organization and Description of the Business

3 Months Ended

Mar. 31, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Description of the Business

Organization and Description of the Business

BrightSphere Investment Group Inc. (“BrightSphere”, “BSIG” or the “Company”), through its subsidiaries, is a global asset management company. The Company provides investment management services globally to predominantly institutional investors. The Company historically held interests in a diverse group of investment management firms (the “Affiliates”) individually headquartered in the United States. The Company completed the disposition of certain Affiliates and, beginning in 2021, has operated the business through one Affiliate, Acadian Asset Management LLC (“Acadian”). Acadian comprises the Company’s Quant & Solutions reportable segment:

•Quant & Solutions—comprised of versatile, often highly-tailored strategies that leverage data and technology in a computational, factor-based investment process across a range of asset classes in developed and emerging markets, including global, non-U.S. and small-cap equities, as well as managed volatility, ESG, multi-asset, equity alternatives, and long/short strategies.

Acadian is organized as a limited liability company. Fees for services are largely asset-based and, as a result, revenues fluctuate based on the performance of financial markets and investors’ asset flows in and out of Acadian’s products. The Company utilizes a profit-sharing model in structuring its compensation and ownership arrangements with Acadian. Variable compensation is based on the firm’s profitability. BSIG and Acadian key employees share in profits after variable compensation according to their respective ownership interests. The profit-sharing model results in the alignment of BSIG and Acadian key employee economic interests, which is critical to the Company’s talent management strategy and long-term growth of the business. The corporate head office is included within the Other category.

Prior to 2014, the Company was a wholly-owned subsidiary of Old Mutual plc (“OM plc”), an international long-term savings, protection, and investment group, listed on the London Stock Exchange. On October 15, 2014, the Company completed the initial public offering (the “Offering”) by OM plc pursuant to the Securities Act of 1933, as amended. As of March 31, 2023, Paulson & Co. Inc. (“Paulson”) held approximately 21.6% of the common stock of the Company.

For the three months ended March 31, 2023, the Company did not repurchase any shares of common stock. For the three months ended March 31, 2022, the Company repurchased 4,147,450 shares of common stock at an average price of $24.09 per share, or approximately $100 million in total, including commissions.

All shares of common stock repurchased by the Company were retired.

XML

Basis of Presentation and Significant Accounting Policies

3 Months Ended

Mar. 31, 2023

Accounting Policies [Abstract]

Basis of Presentation and Significant Accounting Policies

2) Basis of Presentation and Significant Accounting Policies

The Company’s significant accounting policies are as follows:

Basis of presentation

These unaudited Condensed Consolidated Financial Statements reflect the historical balance sheets, statements of operations, statements of comprehensive income, statements of changes in stockholders’ equity and statements of cash flows of the Company. Within these Condensed Consolidated Financial Statements, Paulson and its related entities, as defined above, are referred to as “related parties.”

The Condensed Consolidated Financial Statements are prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). In the opinion of management, all normal and recurring adjustments considered necessary for a fair presentation of the Company’s Condensed Consolidated Financial Statements have been included. All dollar amounts, except per-share data in the text and tables herein, are stated in millions unless otherwise indicated. Transactions between the Company and its related parties are included in the Condensed Consolidated Financial Statements; however, material intercompany balances and transactions among the Company, its consolidated Affiliate and consolidated Funds are eliminated in consolidation.

Certain disclosures included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 (annual report on Form 10-K) are not required to be included on an interim basis in the Company’s quarterly reports on Form 10-Q. The Company has condensed or omitted these disclosures. These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and notes thereto for the year ended December 31, 2022 included in the Company’s Annual Report on Form 10-K as filed with the Securities and Exchange Commission (“SEC”) on February 28, 2023. The Company’s significant accounting policies, which have been consistently applied, are summarized in those financial statements.

Use of estimates

The preparation of these Condensed Consolidated Financial Statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from such estimates, and the differences may be material to the Condensed Consolidated Financial Statements.

New accounting standards not yet adopted

The Company has considered all newly issued accounting guidance that is applicable to the Company’s operations and the preparation of the unaudited Condensed Consolidated Financial Statements, including those that have not yet been adopted. The Company does not believe that any such guidance has or will have a material effect on its Condensed Consolidated Financial Statements and related disclosures.

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Investments

3 Months Ended

Mar. 31, 2023

Investments [Abstract]

Investments

Investments

Investments are comprised of the following as of the dates indicated (in millions):

	March 31, 2023		December 31, 2022
Investments of consolidated Funds held at fair value	$	2.8	$	1.9
Seed & Other investments	$	8.7	$	8.4
Investments related to long-term incentive compensation plans	41.2		40.0
Total investments per Condensed Consolidated Balance Sheets	$	52.7	$	50.3

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Fair Value Measurements

3 Months Ended

Mar. 31, 2023

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

The following table summarizes the Company’s assets that are measured at fair value on a recurring basis at March 31, 2023 (in millions):

	Quoted prices in active markets (Level I)		Significant other observable inputs (Level II)		Significant unobservable inputs (Level III)		Uncategorized		Total value, March 31, 2023
Assets of BSIG and consolidated Funds(1)
Derivatives	$	0.3	$	2.5	$	—	$	—	$	2.8
Consolidated Funds total	0.3		2.5		—		—		2.8
Investments in separate accounts(2)	4.4		—		—		—		4.4
Investments related to long-term incentive compensation plans(3)	41.2		—		—		—		41.2
Investments in unconsolidated Funds(4)	—		—		—		4.3		4.3
BSIG total	45.6		—		—		4.3		49.9
Total fair value assets	$	45.9	$	2.5	$	—	$	4.3	$	52.7
Liabilities of consolidated Funds(1)
Derivatives	$	(0.3)	$	(2.3)	$	—	$	—	$	(2.6)
Consolidated Funds total	(0.3)		(2.3)		—		—		(2.6)
Total fair value liabilities	$	(0.3)	$	(2.3)	$	—	$	—	$	(2.6)

The following table summarizes the Company’s assets that are measured at fair value on a recurring basis at December 31, 2022 (in millions):

	Quoted prices in active markets (Level I)		Significant other observable inputs (Level II)		Significant unobservable inputs (Level III)		Uncategorized		Total value December 31, 2022
Assets of BSIG and consolidated Funds(1)
Derivatives	0.3		1.6		—		—		1.9
Consolidated Funds total	0.3		1.6		—		—		1.9
Investments in separate accounts(2)	$	4.2	$	—	$	—	$	—	$	4.2
Investments related to long-term incentive compensation plans(3)	40.0		—		—		—		40.0
Investments in unconsolidated Funds(4)	—		—		—		4.2		4.2
BSIG total	44.2		—		—		4.2		48.4
Total fair value assets	$	44.5	$	1.6	$	—	$	4.2	$	50.3
Liabilities of consolidated Funds(1)
Derivatives	(0.2)		(2.0)		—		—		(2.2)
Consolidated Funds total	(0.2)		(2.0)		—		—		(2.2)
Total fair value liabilities	$	(0.2)	$	(2.0)	$	—	$	—	$	(2.2)

(1)Assets and liabilities measured at fair value are comprised of financial investments managed by the Company's Affiliate.

Derivatives which are traded on a national securities exchange are stated at the last reported sales price on the day of valuation. To the extent these securities are actively traded and valuation adjustments are not applied, they are classified as Level I. The securities that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs obtained by the Company from independent pricing services are classified as Level II.

The Company obtains prices from independent pricing services that may utilize broker quotes, but generally the independent pricing services will use various other pricing techniques which take into account appropriate factors such as yield, quality, coupon rate, maturity, type of issue, trading characteristics and other data. The Company has not made adjustments to the prices provided.

If the pricing services are only able to (a) obtain a single broker quote or (b) utilize a pricing model, such securities are classified as Level III. If the pricing services are unable to provide prices, the Company attempts to obtain one or more broker quotes directly from a dealer or values such securities at the last bid price obtained. In either case, such securities are classified as Level III. The Company performs due diligence procedures over third party pricing vendors to understand their methodology and controls to support their use in the valuation process to ensure compliance with required accounting disclosures.

(2)Investments in separate accounts of $4.4 million at March 31, 2023 consist of 100% equity securities and other investments. Investments in separate accounts of $4.2 million at December 31, 2022 consist of approximately 100% of equity securities and other investments. The Company values these using the

published price of the underlying securities (classified as Level I) or quoted price supported by observable inputs as of the measurement date (classified as Level II).

(3)Investments related to long-term incentive compensation plans of $41.2 million and $40.0 million at March 31, 2023 and December 31, 2022, respectively, were investments in publicly registered daily redeemable funds (some managed by Acadian), which the Company has classified as trading securities and valued using the published price as of the measurement dates. Accordingly, the Company has classified these investments as Level I.

(4)The uncategorized amounts of $4.3 million and $4.2 million at March 31, 2023 and December 31, 2022, respectively, relate to investments in unconsolidated Funds which consist primarily of investments in Funds and are valued using NAV which the Company relies on to determine their fair value as a practical expedient and has therefore not classified these investments in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to amounts presented in the Condensed Consolidated Balance Sheets. These unconsolidated Funds consist primarily of real estate investment Funds, UCITS and other investment vehicles. The NAVs that have been provided by investees have been derived from the fair values of the underlying investments as of the measurement dates. UCITS and other investment vehicles are not subject to redemption restrictions.

The real estate investment Funds of $4.2 million and $4.1 million at March 31, 2023 and December 31, 2022, respectively, are subject to longer than quarterly redemption restrictions, and due to their nature, distributions are received only as cash flows are generated from underlying assets over the life of the Funds. The range of time over which the underlying assets are expected to be liquidated by the investees is approximately one to two years from March 31, 2023. The valuation process for the underlying real estate investments held by the real estate investment Funds begins with each property or loan being valued by the investment teams. The valuations are then reviewed and approved by the valuation committee, which consists of senior members of the portfolio management, acquisitions, and research teams. For certain properties and loans, the valuation process may also include a valuation by independent appraisers. In connection with this process, changes in fair value measurements from period to period are evaluated for reasonableness, considering items such as market rents, capitalization and discount rates, and general economic and market conditions.

There were no significant transfers of financial assets or liabilities between Levels II or III during the three months ended March 31, 2023 and 2022, respectively.

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Variable Interest Entities

3 Months Ended

Mar. 31, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Variable Interest Entities

Variable Interest Entities

The Company, through its Affiliate, sponsors the formation of various entities considered to be variable interest entities (“VIEs”). These VIEs are primarily Funds managed by the Company’s Affiliate, and other partnership interests typically owned entirely by third-party investors. Certain Funds may be capitalized with seed capital investments from the Company and may be owned partially by Affiliate key employees and/or individuals that have ownership interests in the Affiliate.

The Company’s determination of whether it is the primary beneficiary of a Fund that is a VIE is based in part on an assessment of whether or not the Company and its related parties are exposed to absorb more than an insignificant amount of the risks and rewards of the entity. Typically the Fund’s investors are entitled to substantially all of the economics of these VIEs with the exception of the management fees and performance fees, if any, earned by the Company or any investment the Company has made into the Funds. The Company generally is not the primary

beneficiary of Fund VIEs created to manage assets for clients unless the Company’s ownership interest, including interests of related parties, is substantial.

The following table presents the assets and liabilities of Funds that are VIEs and consolidated by the Company (in millions):

	March 31, 2023		December 31, 2022
Assets
Investments at fair value	$	2.8	$	1.9
Other assets of consolidated Funds	16.1		$	15.2
Total Assets	$	18.9	$	17.1
Liabilities
Liabilities of consolidated Funds	3.1		2.5
Total Liabilities	$	3.1	$	2.5

“Investments at fair value” consist of investments in derivative securities. To the extent the Company also has consolidated Funds that are not VIEs, the assets and liabilities of those Funds are not included in the table above.

The assets of consolidated VIEs presented in the table above belong to the investors in those Funds, are available for use only by the Fund to which they belong, and are not available for use by the Company to the extent they are held by non-controlling interests. Any debt or liabilities held by consolidated Funds have no recourse to the Company’s general credit.

The Company’s involvement with Funds that are VIEs and not consolidated by the Company is generally limited to that of an investment manager and its investment in the unconsolidated VIE, if any. The Company’s investment in any unconsolidated VIE generally represents an insignificant interest of the Fund’s net assets and assets under management, such that the majority of the VIE’s results are attributable to third parties. The Company’s exposure to risk in these entities is generally limited to any capital contribution it has made or is required to make and any earned but uncollected management fees. The Company has not issued any investment performance guarantees to these VIEs or their investors.

The following information pertains to unconsolidated VIEs for which the Company holds a variable interest (in millions):

	March 31, 2023		December 31, 2022
Unconsolidated VIE assets	$	742.5	$	728.1
Unconsolidated VIE liabilities	$	310.6	$	303.6
Equity interests on the Condensed Consolidated Balance Sheets	$	4.2	$	4.1
Maximum risk of loss(1)	$	4.2	$	4.1

(1)Includes equity investments the Company has made or is required to make.

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Borrowings and Debt

3 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

Borrowings and Debt

Borrowings and Debt

The Company’s borrowings and long-term debt was comprised of the following as of the dates indicated (in millions):

	March 31, 2023					December 31, 2022
(in millions)	Carrying Value		Fair Value		Fair Value Level	Carrying Value		Fair Value		Fair Value Level
Revolving credit facility:
$125 million revolving credit facility expiring March 7, 2025(1)	$	87.0	$	87.0	2	$	—	$	—
Total revolving credit facility	$	87.0	$	87.0		$	—	$	—
Third party borrowings:
$275 million 4.80% Senior Notes Due July 27, 2026(2)	$	273.6	$	257.2	2	$	273.5	$	249.7	2
$125 million 5.125% Senior Notes Due August 1, 2031(2)(3)	—		—			—		—
Total third party borrowings	$	273.6	$	257.2		$	273.5	$	249.7

(1)Fair value approximates carrying value because the credit facility has variable interest rates based on selected short term market rates.

(2)The difference between the principal amounts and the carrying values of the senior notes in the table above reflects the unamortized debt issuance costs and discounts.

(3)On January 18, 2022, the Company completed the full redemption of the $125 million aggregate principal amount outstanding of its 5.125% Senior Notes due August 1, 2031. As a result of this transaction, the Company recorded a $3.2 million loss on extinguishment of debt within the Condensed Consolidated Statements of Operations for the three months ended March 31, 2022.

Revolving Credit Facility

On March 7, 2022, the Company, Royal Bank of Canada, BMO Harris Bank, N.A., Goldman Sachs Bank USA, Morgan Stanley Bank, N.A., Bank of America N.A., the Bank of New York Mellon and Citibank, N.A., as an issuing bank and administrative agent (collectively, the “Lenders”), entered into a new revolving credit facility agreement (the “Acadian Credit Agreement”), which replaced the Company’s revolving credit facility dated as of August 20, 2019 (as amended by an amendment dated September 3, 2020 and an assignment and assumption and amendment agreement dated February 23, 2021, the “Original Credit Agreement”). The maturity date of this Original Credit Agreement was August 22, 2022, and the maturity date of the Acadian Credit Agreement is March 7, 2025.

Borrowings under the Acadian Credit Agreement bear interest, at Acadian’s option, at the per annum rate equal to either (a) the greatest of (i) the prime rate, (ii) the federal funds effective rate plus 0.5% and (iii) the secured overnight financing rate for a one month period plus a credit spread adjustment of 0.10% (“Adjusted Term SOFR”) plus 1%, plus, in each case, an additional amount ranging from 0.5% to 1.0%, with such additional amount based on Acadian’s Leverage Ratio (as defined below) or (b) Adjusted Term SOFR plus an additional amount ranging from 1.5% to 2.0%, with such additional amount based on Acadian’s Leverage Ratio. In addition, Acadian is charged a commitment fee based on the average daily unused portion of the revolving credit facility under the Acadian Credit Agreement at a per annum rate ranging from 0.25% to 0.375%, with such amount based on Acadian’s Leverage Ratio.

Under the Acadian Credit Agreement, the ratio of Acadian’s third-party borrowings to Acadian’s trailing twelve months Adjusted EBITDA, as defined by the Acadian Credit Agreement (the “Leverage Ratio”), cannot exceed 2.5x and the Acadian interest coverage ratio must not be less than 4.0x.

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Leases

3 Months Ended

Mar. 31, 2023

Leases [Abstract]

Leases

Leases

The Company has operating leases for corporate offices, data centers and certain equipment. The operating leases have remaining lease terms of less than 1 year to 11 years, some of which include options to extend the leases for up to 5 years.

The following table summarizes information about the Company’s operating leases for the three months ended March 31 (in millions):

	Three Months Ended March 31,
	2023		2022
Operating lease cost	$	2.1	$	2.5
Variable lease cost	—		—
Sublease income	—		(0.1)
Total operating lease expense	$	2.1	$	2.4
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	2.3	$	2.2
Right of use assets obtained in exchange for new operating lease liabilities	2.8		—

In determining the incremental borrowing rate, the Company considered the interest rate yield for the specific interest rate environment and the Company’s credit spread at the inception of the lease. For the three months ended March 31, 2023 and 2022, the weighted average remaining lease term was 10.2 and 11.2, respectively, and the weighted average discount rate was 3.54% and 3.35%, respectively.

Maturities of operating lease liabilities were as follows (in millions):

	Operating Leases
Year Ending December 31,
2023 (excluding the three months ended March 31, 2023)	$	7.0
2024	9.0
2025	8.8
2026	8.8
2027	8.4
Thereafter	49.6
Total lease payments	$	91.6
Less imputed interest	(14.6)
Total	$	77.0

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2023

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Operational commitments

A number of our subsidiaries operate under regulatory authorities that require that they maintain minimum financial or capital requirements. Management is not aware of any violations of such financial requirements occurring during the period.

Included in cash and cash equivalents is $3.6 million pertaining to the wind-down of BrightSphere Investment U.K., Ltd.

Guaranty

The Company entered into a guaranty for an office space security deposit in the amount of $2.5 million in January 2020. This represents the maximum potential amount of future (undiscounted) payments that the Company could be required to make under the guaranty in the event of default by the guaranteed parties. This guaranty expires in 2033. There are no liabilities recorded on the Condensed Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022 related to this guaranty.

Litigation

The Company is subject to claims, legal proceedings, and other contingencies in the ordinary course of its business activities. Each of these matters is subject to various uncertainties, and it is possible that some of these matters may be resolved in a manner unfavorable to the Company. The Company establishes accruals for matters for which the outcome is probable and can be reasonably estimated. As of March 31, 2023, there were no material accruals for claims and the Company does not believe any outstanding matters will have a material adverse effect on the Company.

Indemnifications

In the normal course of business, such as through agreements to enter into business combinations and divestitures of Affiliates, the Company enters into contracts that contain a variety of representations and warranties and which provide general indemnifications. The Company’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Company that have not yet occurred.

Foreign tax contingency

The Company has clients in non-U.S. jurisdictions which require entities that are conducting certain business activities in such jurisdictions to collect and remit tax assessed on certain fees paid for goods and services provided. The Company does not believe this requirement is applicable based on its limited business activities in these jurisdictions. However, given the fact that uncertainty exists around the requirement, the Company has chosen to evaluate its potential exposure related to non-collection and remittance of these taxes. At March 31, 2023, management of the Company has estimated the potential maximum exposure and concluded that it is not material. No accrual for the potential exposure has been recorded as the probability of incurring any potential liability relating to this exposure is not probable at March 31, 2023.

Considerations of credit risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash, cash equivalents, restricted cash and investments. The Company maintains cash and cash equivalents and short term investments with various financial institutions. These financial institutions are typically located in cities in which the Company and its Affiliate operate. For the Company and its Affiliate, cash deposits at a financial institution may exceed Federal Deposit Insurance Corporation insurance limits. Additionally, the Company holds insurance policies which cover historical and future tax benefits relating to certain of its deferred tax assets. The insurers of the policies are considered a significant counterparty to the Company.

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Earnings Per Share

3 Months Ended

Mar. 31, 2023

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per Share

Basic earnings per share is calculated by dividing net income attributable to controlling interests by the weighted-average number of shares of common stock outstanding. Diluted earnings per share is similar to basic earnings per share, but is adjusted for the effect of potentially issuable common stock, except when inclusion is antidilutive.

The calculation of basic and diluted earnings per share of common stock is as follows (dollars in millions, except per share data):

	Three Months Ended March 31,
	2023		2022
Numerator:
Net income attributable to common stock	$	12.0	$	23.8
Denominator:
Weighted-average shares of common stock outstanding—basic	41,444,200		43,969,713
Potential shares of common stock:
Restricted stock units	7,539		10,112
Employee stock options	1,258,838		1,347,565
Weighted-average shares of common stock outstanding—diluted	42,710,577		45,327,390
Earnings per share of common stock attributable to controlling interests:
Basic	$	0.29	$	0.54
Diluted	$	0.28	$	0.53

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Revenue

3 Months Ended

Mar. 31, 2023

Revenue from Contract with Customer [Abstract]

Revenue

Revenue

Management fees

The Company’s management fees are a function of the fee rates the Affiliate charges to it’s clients, which are typically expressed in basis points, and the levels of the Company’s assets under management. The most significant driver of increases or decreases in this average fee rate is changes in the mix of the Company’s assets under management caused by net inflows or outflows in certain asset classes or disproportionate market movements.

Performance fees

The Company’s products subject to performance fees earn these fees upon exceeding high-water mark performance thresholds or outperforming a hurdle rate. Performance fees are recorded in revenues when the contractual performance criteria have been met and when it is probable that a significant reversal of revenue recognized will not occur in future reporting periods.

Disaggregation of management fee revenue

The geographic disaggregation of management fee revenue for the three months ended March 31 (in millions) are presented below:

	Three Months Ended March 31,
	2023		2022
Quant & Solutions
U.S.	$	67.9	$	77.0
Non-U.S.	22.7		25.2
Management fee revenue	$	90.6	$	102.2

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Accumulated Other Comprehensive Income (Loss)

3 Months Ended

Mar. 31, 2023

Equity [Abstract]

Accumulated Other Comprehensive Income (Loss)

Accumulated Other Comprehensive Income (Loss)

The components of accumulated other comprehensive income (loss), net of tax, for the three months ended March 31, 2023 and 2022 are as follows (in millions):

	Foreign currency translation adjustment		Valuation and amortization of derivative securities		Total
Balance, as of December 31, 2022	$	1.7	$	(12.3)	$	(10.6)
Foreign currency translation adjustment	0.7		—		0.7
Amortization related to derivatives securities, before tax	—		0.8		0.8
Tax impact	—		(0.2)		(0.2)
Other comprehensive income	0.7		0.6		1.3
Balance, as of March 31, 2023	$	2.4	$	(11.7)	$	(9.3)

	Foreign currency translation adjustment		Valuation and amortization of derivative securities		Total
Balance, as of December 31, 2021	$	4.8	$	(15.6)	$	(10.8)
Foreign currency translation adjustment	(0.7)		—		(0.7)
Amortization related to derivatives securities, before tax(1)	—		2.2		2.2
Tax impact	—		(0.6)		(0.6)
Other comprehensive income (loss)	(0.7)		1.6		0.9
Balance, as of March 31, 2022	$	4.1	$	(14.0)	$	(9.9)

(1)On January 18, 2022, the Company completed the full redemption of the $125 million aggregate principal amount outstanding of its 5.125% Senior Notes due August 1, 2031. As a result of this transaction, the Company recorded $1.3 million of amortization expense included in Amortization related to derivatives securities, before tax for the three months ended March 31, 2022.

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Derivatives and Hedging

3 Months Ended

Mar. 31, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives and Hedging

Derivatives and Hedging

Cash flow hedge

In July 2015, the Company entered into a series of $300.0 million notional Treasury rate lock contracts which were designated and qualified as cash flow hedges. The Company documented its hedging strategy and risk management objective for this contract in anticipation of a future debt issuance. The Treasury rate lock contract eliminated the impact of fluctuations in the underlying benchmark interest rate for future forecasted debt issuances. The Company assessed the effectiveness of the hedging contract at inception and on a quarterly basis thereafter. The forecasted debt issuances occurred in July 2016 and the Treasury rate lock, which had an accumulated fair value of $(34.4) million, was settled.

As of March 31, 2023, the balance recorded in accumulated other comprehensive income (loss) was $(11.7) million, net of tax. This balance will be reclassified to earnings through interest expense over the life of the issued debt. Amounts of $0.8 million and $2.2 million have been reclassified for the three months ended March 31, 2023 and 2022, respectively. During the next twelve months the Company expects to reclassify approximately $3.5 million to interest expense.

On January 18, 2022, the Company completed the full redemption of the $125 million aggregate principal amount outstanding of its 5.125% Senior Notes due August 1, 2031. As a result of this transaction, amortization expense of $1.3 million (of the $2.2 million interest expense reclassified to earnings for the three months ended March 31, 2022) was reclassified to earnings as interest expense.

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Segments

3 Months Ended

Mar. 31, 2023

Segment Reporting [Abstract]

Segments

Segments

The Company has the following reportable segment:

•Quant & Solutions—comprised of versatile, often highly-tailored strategies that leverage data and technology in a computational, factor-based investment process across a range of asset classes in developed and emerging markets, including global, non-U.S. and small-cap equities, as well as managed volatility, ESG, multi-asset, equity alternatives, and long/short strategies. This segment is comprised of the Company’s interest in Acadian.

The corporate head office is included within the Other category. The corporate head office expenses are not allocated to the Company’s business segment but the Chief Operating Decision Maker (“CODM”) does consider the cost structure of the corporate head office when evaluating the financial performance of the segment.

Performance Measure

The primary measure used by the CODM in measuring performance and allocating resources to the segments is Economic Net Income (“ENI”). The Company defines ENI for the segments as ENI revenue less (i) ENI operating expenses, (ii) variable compensation and (iii) key employee distributions. The ENI adjustments to U.S. GAAP include both reclassifications of U.S. GAAP revenue and expense items, as well as adjustments to U.S. GAAP results, primarily to exclude non-cash, non-economic expenses, or to reflect cash benefits not recognized under U.S. GAAP. This measure supplements and should be considered in addition to, and not in lieu of, the Condensed Consolidated Statements of Operations prepared in accordance with U.S. GAAP. The Company does not disclose total asset information for its reportable segment as the information is not reviewed by the CODM.

ENI revenue includes management fees, performance fees and other revenue under U.S. GAAP, adjusted to include management fees paid to Affiliates by consolidated Funds and the Company’s share of earnings from equity-accounted Affiliate.

ENI operating expenses include compensation and benefits, general and administrative expense, and depreciation and amortization under U.S. GAAP, adjusted to exclude non-cash expenses representing changes in the value of Affiliate equity and profit interests held by Affiliate key employees, goodwill impairment and amortization of acquired intangible assets, capital transaction costs and restructuring costs. Additionally, variable compensation and Affiliate key employee distributions are segregated from ENI operating expenses.

ENI segment results are also adjusted to exclude the portion of consolidated Fund revenues, expenses and investment return recorded under U.S. GAAP.

Segment Presentation

The following tables set forth summarized operating results for the Company’s segment and related adjustments necessary to reconcile the segment economic net income to arrive at the Company’s consolidated U.S. GAAP net income (loss).

The following table presents the financial data for the Company’s segment for the three months ended March 31, 2023 (in millions):

	Three Months Ended March 31, 2023
	Quant & Solutions		Other		Reconciling Adjustments			Total U.S. GAAP(1)
ENI revenue	$	91.1	$	—	$	0.7		$	91.8
ENI operating expenses	43.6		3.5		0.5		(a)	47.6
Earnings before variable compensation	47.5		(3.5)		0.2			44.2
Variable compensation	22.5		0.7		—			23.2
ENI operating earnings (after variable comp)	25.0		(4.2)		0.2			21.0
Affiliate key employee distributions	1.2		—		—			1.2
Earnings after Affiliate key employee distributions	23.8		(4.2)		0.2			19.8
Net interest expense	—		(3.4)		(0.4)		(b)	(3.8)
Net investment income	—		—		1.1		(c)	1.1
Income tax expense	—		(4.4)		(0.7)		(d)	(5.1)
Economic net income	$	23.8	$	(12.0)	$	0.2		$	12.0

The following table presents the financial data for the Company’s segment for the three months ended March 31, 2022 (in millions):

	Three Months Ended March 31, 2022
	Quant & Solutions		Other		Reconciling Adjustments			Total U.S. GAAP(1)
ENI revenue	$	112.2	$	—	$	—		$	112.2
ENI operating expenses	41.1		4.5		(6.4)		(a)	39.2
Earnings before variable compensation	71.1		(4.5)		6.4			73.0
Variable compensation	26.3		1.6		—			27.9
ENI operating earnings (after variable comp)	44.8		(6.1)		6.4			45.1
Affiliate key employee distributions	1.9		—		—			1.9
Earnings after Affiliate key employee distributions	42.9		(6.1)		6.4			43.2
Net interest expense	—		(4.6)		(1.9)		(b)	(6.5)
Net investment income (loss)	—		—		(0.1)		(c)	(0.1)
Loss on extinguishment of debt	—		—		(3.2)		(c)	(3.2)
Income tax expense	—		(8.8)		(0.8)		(d)	(9.6)
Economic net income	$	42.9	$	(19.5)	$	0.4		$	23.8

(1)The most directly comparable U.S. GAAP measure of ENI revenue is U.S. GAAP revenue. The most directly comparable U.S. GAAP measure of ENI operating expenses is U.S. GAAP operating expenses, which is comprised of ENI operating expenses, variable compensation, and Affiliate key employee distributions above. The most directly comparable U.S. GAAP measure of earnings after Affiliate key employee distributions is U.S. GAAP operating income. The most directly comparable U.S. GAAP measure of ENI is U.S. GAAP net income attributable to controlling interests.

Reconciling Adjustments:

a.Adjusted to include non-cash expenses for key employee equity and profit interest revaluations, capital transaction costs, amortization of acquired intangible assets and restructuring costs, each of which are included in U.S. GAAP operating expenses.

b.Adjusted to include the cost of seed financing and amortization of debt issuance costs, which is included in U.S. GAAP interest expense.

c.Adjusted to include net investment income (loss), the loss on extinguishment of debt, net income attributable to non-controlling interests in consolidated Funds, and net of tax, all of which are included in U.S. GAAP net income attributable to controlling interests.

d.Adjusted to include the impact of deferred tax attributable to the amortization of goodwill and acquired intangibles. Also adjusted to include the tax impact of certain ENI adjustments; exclude the tax expense or benefits relating to uncertain tax positions, and exclude the tax impact of other unusual items that are not related to current operating results for ENI purposes.

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Basis of Presentation and Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2023

Accounting Policies [Abstract]

Basis of presentation

Basis of presentation

These unaudited Condensed Consolidated Financial Statements reflect the historical balance sheets, statements of operations, statements of comprehensive income, statements of changes in stockholders’ equity and statements of cash flows of the Company. Within these Condensed Consolidated Financial Statements, Paulson and its related entities, as defined above, are referred to as “related parties.”

The Condensed Consolidated Financial Statements are prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). In the opinion of management, all normal and recurring adjustments considered necessary for a fair presentation of the Company’s Condensed Consolidated Financial Statements have been included. All dollar amounts, except per-share data in the text and tables herein, are stated in millions unless otherwise indicated. Transactions between the Company and its related parties are included in the Condensed Consolidated Financial Statements; however, material intercompany balances and transactions among the Company, its consolidated Affiliate and consolidated Funds are eliminated in consolidation.

Certain disclosures included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 (annual report on Form 10-K) are not required to be included on an interim basis in the Company’s quarterly reports on Form 10-Q. The Company has condensed or omitted these disclosures. These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and notes thereto for the year ended December 31, 2022 included in the Company’s Annual Report on Form 10-K as filed with the Securities and Exchange Commission (“SEC”) on February 28, 2023. The Company’s significant accounting policies, which have been consistently applied, are summarized in those financial statements.

Use of estimates

Use of estimatesThe preparation of these Condensed Consolidated Financial Statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from such estimates, and the differences may be material to the Condensed Consolidated Financial Statements.

New accounting standards not yet adopted

New accounting standards not yet adopted

The Company has considered all newly issued accounting guidance that is applicable to the Company’s operations and the preparation of the unaudited Condensed Consolidated Financial Statements, including those that have not yet been adopted. The Company does not believe that any such guidance has or will have a material effect on its Condensed Consolidated Financial Statements and related disclosures.

Variable interest entities (“VIEs”)

The Company, through its Affiliate, sponsors the formation of various entities considered to be variable interest entities (“VIEs”). These VIEs are primarily Funds managed by the Company’s Affiliate, and other partnership interests typically owned entirely by third-party investors. Certain Funds may be capitalized with seed capital investments from the Company and may be owned partially by Affiliate key employees and/or individuals that have ownership interests in the Affiliate.

The Company’s determination of whether it is the primary beneficiary of a Fund that is a VIE is based in part on an assessment of whether or not the Company and its related parties are exposed to absorb more than an insignificant amount of the risks and rewards of the entity. Typically the Fund’s investors are entitled to substantially all of the economics of these VIEs with the exception of the management fees and performance fees, if any, earned by the Company or any investment the Company has made into the Funds. The Company generally is not the primary

beneficiary of Fund VIEs created to manage assets for clients unless the Company’s ownership interest, including interests of related parties, is substantial. The Company’s investment in any unconsolidated VIE generally represents an insignificant interest of the Fund’s net assets and assets under management, such that the majority of the VIE’s results are attributable to third parties. The Company’s exposure to risk in these entities is generally limited to any capital contribution it has made or is required to make and any earned but uncollected management fees. The Company has not issued any investment performance guarantees to these VIEs or their investors.

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Investment (Tables)

3 Months Ended

Mar. 31, 2023

Investments [Abstract]

Schedule of Investment Components

Investments are comprised of the following as of the dates indicated (in millions):

	March 31, 2023		December 31, 2022
Investments of consolidated Funds held at fair value	$	2.8	$	1.9
Seed & Other investments	$	8.7	$	8.4
Investments related to long-term incentive compensation plans	41.2		40.0
Total investments per Condensed Consolidated Balance Sheets	$	52.7	$	50.3

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Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2023

Fair Value Disclosures [Abstract]

Schedule of The Assets and Liabilities That are Measured at Fair Value on a Recurring Basis

The following table summarizes the Company’s assets that are measured at fair value on a recurring basis at March 31, 2023 (in millions):

	Quoted prices in active markets (Level I)		Significant other observable inputs (Level II)		Significant unobservable inputs (Level III)		Uncategorized		Total value, March 31, 2023
Assets of BSIG and consolidated Funds(1)
Derivatives	$	0.3	$	2.5	$	—	$	—	$	2.8
Consolidated Funds total	0.3		2.5		—		—		2.8
Investments in separate accounts(2)	4.4		—		—		—		4.4
Investments related to long-term incentive compensation plans(3)	41.2		—		—		—		41.2
Investments in unconsolidated Funds(4)	—		—		—		4.3		4.3
BSIG total	45.6		—		—		4.3		49.9
Total fair value assets	$	45.9	$	2.5	$	—	$	4.3	$	52.7
Liabilities of consolidated Funds(1)
Derivatives	$	(0.3)	$	(2.3)	$	—	$	—	$	(2.6)
Consolidated Funds total	(0.3)		(2.3)		—		—		(2.6)
Total fair value liabilities	$	(0.3)	$	(2.3)	$	—	$	—	$	(2.6)

The following table summarizes the Company’s assets that are measured at fair value on a recurring basis at December 31, 2022 (in millions):

	Quoted prices in active markets (Level I)		Significant other observable inputs (Level II)		Significant unobservable inputs (Level III)		Uncategorized		Total value December 31, 2022
Assets of BSIG and consolidated Funds(1)
Derivatives	0.3		1.6		—		—		1.9
Consolidated Funds total	0.3		1.6		—		—		1.9
Investments in separate accounts(2)	$	4.2	$	—	$	—	$	—	$	4.2
Investments related to long-term incentive compensation plans(3)	40.0		—		—		—		40.0
Investments in unconsolidated Funds(4)	—		—		—		4.2		4.2
BSIG total	44.2		—		—		4.2		48.4
Total fair value assets	$	44.5	$	1.6	$	—	$	4.2	$	50.3
Liabilities of consolidated Funds(1)
Derivatives	(0.2)		(2.0)		—		—		(2.2)
Consolidated Funds total	(0.2)		(2.0)		—		—		(2.2)
Total fair value liabilities	$	(0.2)	$	(2.0)	$	—	$	—	$	(2.2)

(1)Assets and liabilities measured at fair value are comprised of financial investments managed by the Company's Affiliate.

Derivatives which are traded on a national securities exchange are stated at the last reported sales price on the day of valuation. To the extent these securities are actively traded and valuation adjustments are not applied, they are classified as Level I. The securities that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs obtained by the Company from independent pricing services are classified as Level II.

The Company obtains prices from independent pricing services that may utilize broker quotes, but generally the independent pricing services will use various other pricing techniques which take into account appropriate factors such as yield, quality, coupon rate, maturity, type of issue, trading characteristics and other data. The Company has not made adjustments to the prices provided.

If the pricing services are only able to (a) obtain a single broker quote or (b) utilize a pricing model, such securities are classified as Level III. If the pricing services are unable to provide prices, the Company attempts to obtain one or more broker quotes directly from a dealer or values such securities at the last bid price obtained. In either case, such securities are classified as Level III. The Company performs due diligence procedures over third party pricing vendors to understand their methodology and controls to support their use in the valuation process to ensure compliance with required accounting disclosures.

(2)Investments in separate accounts of $4.4 million at March 31, 2023 consist of 100% equity securities and other investments. Investments in separate accounts of $4.2 million at December 31, 2022 consist of approximately 100% of equity securities and other investments. The Company values these using the

published price of the underlying securities (classified as Level I) or quoted price supported by observable inputs as of the measurement date (classified as Level II).

(3)Investments related to long-term incentive compensation plans of $41.2 million and $40.0 million at March 31, 2023 and December 31, 2022, respectively, were investments in publicly registered daily redeemable funds (some managed by Acadian), which the Company has classified as trading securities and valued using the published price as of the measurement dates. Accordingly, the Company has classified these investments as Level I.

(4)The uncategorized amounts of $4.3 million and $4.2 million at March 31, 2023 and December 31, 2022, respectively, relate to investments in unconsolidated Funds which consist primarily of investments in Funds and are valued using NAV which the Company relies on to determine their fair value as a practical expedient and has therefore not classified these investments in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to amounts presented in the Condensed Consolidated Balance Sheets. These unconsolidated Funds consist primarily of real estate investment Funds, UCITS and other investment vehicles. The NAVs that have been provided by investees have been derived from the fair values of the underlying investments as of the measurement dates. UCITS and other investment vehicles are not subject to redemption restrictions.

The real estate investment Funds of $4.2 million and $4.1 million at March 31, 2023 and December 31, 2022, respectively, are subject to longer than quarterly redemption restrictions, and due to their nature, distributions are received only as cash flows are generated from underlying assets over the life of the Funds. The range of time over which the underlying assets are expected to be liquidated by the investees is approximately one to two years from March 31, 2023. The valuation process for the underlying real estate investments held by the real estate investment Funds begins with each property or loan being valued by the investment teams. The valuations are then reviewed and approved by the valuation committee, which consists of senior members of the portfolio management, acquisitions, and research teams. For certain properties and loans, the valuation process may also include a valuation by independent appraisers. In connection with this process, changes in fair value measurements from period to period are evaluated for reasonableness, considering items such as market rents, capitalization and discount rates, and general economic and market conditions.

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Variable Interest Entities (Tables)

3 Months Ended

Mar. 31, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Assets and Liabilities and Information Pertains to VIEs

The following table presents the assets and liabilities of Funds that are VIEs and consolidated by the Company (in millions):

	March 31, 2023		December 31, 2022
Assets
Investments at fair value	$	2.8	$	1.9
Other assets of consolidated Funds	16.1		$	15.2
Total Assets	$	18.9	$	17.1
Liabilities
Liabilities of consolidated Funds	3.1		2.5
Total Liabilities	$	3.1	$	2.5

The following information pertains to unconsolidated VIEs for which the Company holds a variable interest (in millions):

	March 31, 2023		December 31, 2022
Unconsolidated VIE assets	$	742.5	$	728.1
Unconsolidated VIE liabilities	$	310.6	$	303.6
Equity interests on the Condensed Consolidated Balance Sheets	$	4.2	$	4.1
Maximum risk of loss(1)	$	4.2	$	4.1

(1)Includes equity investments the Company has made or is required to make.

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Borrowings and Debt (Tables)

3 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

Schedule of Long Term Debt

The Company’s borrowings and long-term debt was comprised of the following as of the dates indicated (in millions):

	March 31, 2023					December 31, 2022
(in millions)	Carrying Value		Fair Value		Fair Value Level	Carrying Value		Fair Value		Fair Value Level
Revolving credit facility:
$125 million revolving credit facility expiring March 7, 2025(1)	$	87.0	$	87.0	2	$	—	$	—
Total revolving credit facility	$	87.0	$	87.0		$	—	$	—
Third party borrowings:
$275 million 4.80% Senior Notes Due July 27, 2026(2)	$	273.6	$	257.2	2	$	273.5	$	249.7	2
$125 million 5.125% Senior Notes Due August 1, 2031(2)(3)	—		—			—		—
Total third party borrowings	$	273.6	$	257.2		$	273.5	$	249.7

(1)Fair value approximates carrying value because the credit facility has variable interest rates based on selected short term market rates.

(2)The difference between the principal amounts and the carrying values of the senior notes in the table above reflects the unamortized debt issuance costs and discounts.

(3)On January 18, 2022, the Company completed the full redemption of the $125 million aggregate principal amount outstanding of its 5.125% Senior Notes due August 1, 2031. As a result of this transaction, the Company recorded a $3.2 million loss on extinguishment of debt within the Condensed Consolidated Statements of Operations for the three months ended March 31, 2022.

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Leases (Tables)

3 Months Ended

Mar. 31, 2023

Leases [Abstract]

Summary of Lease Information

The following table summarizes information about the Company’s operating leases for the three months ended March 31 (in millions):

	Three Months Ended March 31,
	2023		2022
Operating lease cost	$	2.1	$	2.5
Variable lease cost	—		—
Sublease income	—		(0.1)
Total operating lease expense	$	2.1	$	2.4
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	2.3	$	2.2
Right of use assets obtained in exchange for new operating lease liabilities	2.8		—

Summary of Maturities of Operating Lease Liabilities

Maturities of operating lease liabilities were as follows (in millions):

	Operating Leases
Year Ending December 31,
2023 (excluding the three months ended March 31, 2023)	$	7.0
2024	9.0
2025	8.8
2026	8.8
2027	8.4
Thereafter	49.6
Total lease payments	$	91.6
Less imputed interest	(14.6)
Total	$	77.0

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Earnings Per Share (Tables)

3 Months Ended

Mar. 31, 2023

Earnings Per Share [Abstract]

Schedule of Calculation of Pro Forma Basic and Diluted Earnings Per Share

The calculation of basic and diluted earnings per share of common stock is as follows (dollars in millions, except per share data):

	Three Months Ended March 31,
	2023		2022
Numerator:
Net income attributable to common stock	$	12.0	$	23.8
Denominator:
Weighted-average shares of common stock outstanding—basic	41,444,200		43,969,713
Potential shares of common stock:
Restricted stock units	7,539		10,112
Employee stock options	1,258,838		1,347,565
Weighted-average shares of common stock outstanding—diluted	42,710,577		45,327,390
Earnings per share of common stock attributable to controlling interests:
Basic	$	0.29	$	0.54
Diluted	$	0.28	$	0.53

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Revenue (Tables)

3 Months Ended

Mar. 31, 2023

Revenue from Contract with Customer [Abstract]

Schedule of Disaggregation of Revenue

The geographic disaggregation of management fee revenue for the three months ended March 31 (in millions) are presented below:

	Three Months Ended March 31,
	2023		2022
Quant & Solutions
U.S.	$	67.9	$	77.0
Non-U.S.	22.7		25.2
Management fee revenue	$	90.6	$	102.2

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Accumulated Other Comprehensive Income (Loss) (Tables)

3 Months Ended

Mar. 31, 2023

Equity [Abstract]

Schedule of Components of Accumulated Other Comprehensive Income Including Proportions Attributable to Non-controlling Interests

The components of accumulated other comprehensive income (loss), net of tax, for the three months ended March 31, 2023 and 2022 are as follows (in millions):

	Foreign currency translation adjustment		Valuation and amortization of derivative securities		Total
Balance, as of December 31, 2022	$	1.7	$	(12.3)	$	(10.6)
Foreign currency translation adjustment	0.7		—		0.7
Amortization related to derivatives securities, before tax	—		0.8		0.8
Tax impact	—		(0.2)		(0.2)
Other comprehensive income	0.7		0.6		1.3
Balance, as of March 31, 2023	$	2.4	$	(11.7)	$	(9.3)

	Foreign currency translation adjustment		Valuation and amortization of derivative securities		Total
Balance, as of December 31, 2021	$	4.8	$	(15.6)	$	(10.8)
Foreign currency translation adjustment	(0.7)		—		(0.7)
Amortization related to derivatives securities, before tax(1)	—		2.2		2.2
Tax impact	—		(0.6)		(0.6)
Other comprehensive income (loss)	(0.7)		1.6		0.9
Balance, as of March 31, 2022	$	4.1	$	(14.0)	$	(9.9)

(1)On January 18, 2022, the Company completed the full redemption of the $125 million aggregate principal amount outstanding of its 5.125% Senior Notes due August 1, 2031. As a result of this transaction, the Company recorded $1.3 million of amortization expense included in Amortization related to derivatives securities, before tax for the three months ended March 31, 2022.

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Segments (Tables)

3 Months Ended

Mar. 31, 2023

Segment Reporting [Abstract]

Schedule of Reconciling Adjustments

The following table presents the financial data for the Company’s segment for the three months ended March 31, 2023 (in millions):

	Three Months Ended March 31, 2023
	Quant & Solutions		Other		Reconciling Adjustments			Total U.S. GAAP(1)
ENI revenue	$	91.1	$	—	$	0.7		$	91.8
ENI operating expenses	43.6		3.5		0.5		(a)	47.6
Earnings before variable compensation	47.5		(3.5)		0.2			44.2
Variable compensation	22.5		0.7		—			23.2
ENI operating earnings (after variable comp)	25.0		(4.2)		0.2			21.0
Affiliate key employee distributions	1.2		—		—			1.2
Earnings after Affiliate key employee distributions	23.8		(4.2)		0.2			19.8
Net interest expense	—		(3.4)		(0.4)		(b)	(3.8)
Net investment income	—		—		1.1		(c)	1.1
Income tax expense	—		(4.4)		(0.7)		(d)	(5.1)
Economic net income	$	23.8	$	(12.0)	$	0.2		$	12.0

The following table presents the financial data for the Company’s segment for the three months ended March 31, 2022 (in millions):

	Three Months Ended March 31, 2022
	Quant & Solutions		Other		Reconciling Adjustments			Total U.S. GAAP(1)
ENI revenue	$	112.2	$	—	$	—		$	112.2
ENI operating expenses	41.1		4.5		(6.4)		(a)	39.2
Earnings before variable compensation	71.1		(4.5)		6.4			73.0
Variable compensation	26.3		1.6		—			27.9
ENI operating earnings (after variable comp)	44.8		(6.1)		6.4			45.1
Affiliate key employee distributions	1.9		—		—			1.9
Earnings after Affiliate key employee distributions	42.9		(6.1)		6.4			43.2
Net interest expense	—		(4.6)		(1.9)		(b)	(6.5)
Net investment income (loss)	—		—		(0.1)		(c)	(0.1)
Loss on extinguishment of debt	—		—		(3.2)		(c)	(3.2)
Income tax expense	—		(8.8)		(0.8)		(d)	(9.6)
Economic net income	$	42.9	$	(19.5)	$	0.4		$	23.8

(1)The most directly comparable U.S. GAAP measure of ENI revenue is U.S. GAAP revenue. The most directly comparable U.S. GAAP measure of ENI operating expenses is U.S. GAAP operating expenses, which is comprised of ENI operating expenses, variable compensation, and Affiliate key employee distributions above. The most directly comparable U.S. GAAP measure of earnings after Affiliate key employee distributions is U.S. GAAP operating income. The most directly comparable U.S. GAAP measure of ENI is U.S. GAAP net income attributable to controlling interests.

Reconciling Adjustments:

a.Adjusted to include non-cash expenses for key employee equity and profit interest revaluations, capital transaction costs, amortization of acquired intangible assets and restructuring costs, each of which are included in U.S. GAAP operating expenses.

b.Adjusted to include the cost of seed financing and amortization of debt issuance costs, which is included in U.S. GAAP interest expense.

c.Adjusted to include net investment income (loss), the loss on extinguishment of debt, net income attributable to non-controlling interests in consolidated Funds, and net of tax, all of which are included in U.S. GAAP net income attributable to controlling interests.

d.Adjusted to include the impact of deferred tax attributable to the amortization of goodwill and acquired intangibles. Also adjusted to include the tax impact of certain ENI adjustments; exclude the tax expense or benefits relating to uncertain tax positions, and exclude the tax impact of other unusual items that are not related to current operating results for ENI purposes.

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Organization and Description of the Business (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Business Acquisition [Line Items]
Repurchase of common stock (in shares)	0	4,147,450
Average price of common stock repurchased (in dollars per share)		$ 24.09
Stock repurchased, net of commissions		$ 100
BrightSphere Investment Group | Paulson
Business Acquisition [Line Items]
Parent owned interest	21.60%

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Investments - Schedule of Investment Components (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Investment Holdings [Line Items]
Total investments per Condensed Consolidated Balance Sheets	$ 52.7	$ 50.3
Consolidated Funds
Investment Holdings [Line Items]
Investments at fair value	2.8	1.9
Total investments per Condensed Consolidated Balance Sheets	2.8	1.9
Consolidated Entity Excluding Consolidated Funds
Investment Holdings [Line Items]
Total investments per Condensed Consolidated Balance Sheets	49.9	48.4
Seed & Other investments | Consolidated Entity Excluding Consolidated Funds
Investment Holdings [Line Items]
Investments at fair value	8.7	8.4
Investments related to long-term incentive compensation plans | Consolidated Entity Excluding Consolidated Funds
Investment Holdings [Line Items]
Investments at fair value	$ 41.2	$ 40.0

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Fair Value Measurements - Summary of the Assets and Liabilities that are Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Asset of BSIF and consolidated Funds
Total fair value assets	$ 52.7	$ 50.3
Derivative Liability, Statement of Financial Position [Extensible Enumeration]	Derivative liabilities at fair value	Derivative liabilities at fair value
Total fair value liabilities	$ (2.6)	$ (2.2)
Investments in unconsolidated funds
Asset of BSIF and consolidated Funds
Uncategorized	$ 4.3	4.2
Minimum | Real estate investment funds
Asset of BSIF and consolidated Funds
Term over which the underlying assets are expected to be liquidated by the investees	1 year
Maximum | Real estate investment funds
Asset of BSIF and consolidated Funds
Term over which the underlying assets are expected to be liquidated by the investees	2 years
Consolidated Entity Excluding Consolidated Funds
Asset of BSIF and consolidated Funds
Derivatives	$ 2.8	1.9
Derivative asset Consolidated Funds total	2.8	1.9
Consolidated Funds total	49.9	48.4
Derivative Liability	(2.6)	(2.2)
Consolidated Funds total	(2.6)	(2.2)
Consolidated Entity Excluding Consolidated Funds | Investments in separate accounts
Asset of BSIF and consolidated Funds
Investments in separate accounts	4.4	4.2
Consolidated Entity Excluding Consolidated Funds | Investments related to long-term incentive compensation plans
Asset of BSIF and consolidated Funds
Investments related to long-term incentive compensation plans	41.2	40.0
Investments in unconsolidated Funds	41.2	40.0
Consolidated Entity Excluding Consolidated Funds | Investments in unconsolidated funds
Asset of BSIF and consolidated Funds
Investments in unconsolidated Funds	4.3	4.2
Uncategorized	4.3	4.2
Consolidated Entity Excluding Consolidated Funds | Investment Funds Subject to Longer Redemption Restrictions
Asset of BSIF and consolidated Funds
Uncategorized	4.2	4.1
Quoted prices in active markets (Level I)
Asset of BSIF and consolidated Funds
Total fair value assets	45.9	44.5
Total fair value liabilities	(0.3)	(0.2)
Quoted prices in active markets (Level I) | Consolidated Entity Excluding Consolidated Funds
Asset of BSIF and consolidated Funds
Derivatives	0.3	0.3
Derivative asset Consolidated Funds total	0.3	0.3
Consolidated Funds total	45.6	44.2
Uncategorized	4.3	4.2
Derivative Liability	(0.3)	(0.2)
Consolidated Funds total	$ (0.3)	$ (0.2)
Investment in equity securities	100.00%	100.00%
Quoted prices in active markets (Level I) | Consolidated Entity Excluding Consolidated Funds | Investments in separate accounts
Asset of BSIF and consolidated Funds
Investments in separate accounts	$ 4.4	$ 4.2
Quoted prices in active markets (Level I) | Consolidated Entity Excluding Consolidated Funds | Investments related to long-term incentive compensation plans
Asset of BSIF and consolidated Funds
Investments related to long-term incentive compensation plans	41.2	40.0
Quoted prices in active markets (Level I) | Consolidated Entity Excluding Consolidated Funds | Investments in unconsolidated funds
Asset of BSIF and consolidated Funds
Investments in unconsolidated Funds	0.0	0.0
Significant other observable inputs (Level II)
Asset of BSIF and consolidated Funds
Total fair value assets	2.5	1.6
Total fair value liabilities	(2.3)	(2.0)
Significant other observable inputs (Level II) | Consolidated Entity Excluding Consolidated Funds
Asset of BSIF and consolidated Funds
Derivatives	2.5	1.6
Derivative asset Consolidated Funds total	2.5	1.6
Consolidated Funds total	0.0	0.0
Derivative Liability	(2.3)	(2.0)
Consolidated Funds total	(2.3)	(2.0)
Significant other observable inputs (Level II) | Consolidated Entity Excluding Consolidated Funds | Investments in separate accounts
Asset of BSIF and consolidated Funds
Investments in separate accounts	0.0	0.0
Significant other observable inputs (Level II) | Consolidated Entity Excluding Consolidated Funds | Investments related to long-term incentive compensation plans
Asset of BSIF and consolidated Funds
Investments related to long-term incentive compensation plans	0.0	0.0
Significant other observable inputs (Level II) | Consolidated Entity Excluding Consolidated Funds | Investments in unconsolidated funds
Asset of BSIF and consolidated Funds
Investments in unconsolidated Funds	0.0	0.0
Significant unobservable inputs (Level III)
Asset of BSIF and consolidated Funds
Total fair value assets	0.0	0.0
Total fair value liabilities	0.0	0.0
Significant unobservable inputs (Level III) | Consolidated Entity Excluding Consolidated Funds
Asset of BSIF and consolidated Funds
Derivatives	0.0	0.0
Derivative asset Consolidated Funds total	0.0	0.0
Consolidated Funds total	0.0	0.0
Derivative Liability	0.0	0.0
Consolidated Funds total	0.0	0.0
Significant unobservable inputs (Level III) | Consolidated Entity Excluding Consolidated Funds | Investments in separate accounts
Asset of BSIF and consolidated Funds
Investments in separate accounts	0.0	0.0
Significant unobservable inputs (Level III) | Consolidated Entity Excluding Consolidated Funds | Investments related to long-term incentive compensation plans
Asset of BSIF and consolidated Funds
Investments related to long-term incentive compensation plans	0.0	0.0
Significant unobservable inputs (Level III) | Consolidated Entity Excluding Consolidated Funds | Investments in unconsolidated funds
Asset of BSIF and consolidated Funds
Investments in unconsolidated Funds	$ 0.0	$ 0.0

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Fair Value Measures and Disclosures (Details) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Fair Value Disclosures [Abstract]
Transfers between levels two or three	$ 0	$ 0

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Variable Interest Entities - Assets and Liabilities of Funds that are VIEs (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Variable Interest Entities
Assets	$ 546.0	$ 518.7
Liabilities	554.3	540.3
Variable Interest Entity, Primary Beneficiary
Variable Interest Entities
Investments at fair value	2.8	1.9
Other assets	16.1	15.2
Assets	18.9	17.1
Other liabilities	3.1	2.5
Liabilities	$ 3.1	$ 2.5

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Variable Interest Entities - Information of Variable Interest Holdings (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Variable Interest Entities
Unconsolidated VIE assets	$ 546.0	$ 518.7
Unconsolidated VIE liabilities	554.3	540.3
Variable Interest Entity, Not Primary Beneficiary
Variable Interest Entities
Unconsolidated VIE assets	742.5	728.1
Unconsolidated VIE liabilities	310.6	303.6
Equity interests on the Condensed Consolidated Balance Sheets	4.2	4.1
Maximum risk of loss	$ 4.2	$ 4.1

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Borrowings and Debt - Long Term Debt (Details) - USD ($)		3 Months Ended
	Jan. 18, 2022	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Debt Instrument [Line Items]
Loss on extinguishment of debt		$ 0	$ 3,200,000
Fair Value, Inputs, Level 2
Debt Instrument [Line Items]
Carrying Value		273,600,000		$ 273,500,000
Fair Value		257,200,000		249,700,000
Line of Credit | Revolving credit facility
Debt Instrument [Line Items]
Face amount		125,000,000
Line of Credit | Revolving credit facility | Fair Value, Inputs, Level 2
Debt Instrument [Line Items]
Carrying Value		87,000,000.0		0
Fair Value		87,000,000.0		0
Revolving Credit Facility Expiring March 7 2025 | Line of Credit | Revolving credit facility | Fair Value, Inputs, Level 2
Debt Instrument [Line Items]
Carrying Value		87,000,000.0		0
Fair Value		87,000,000.0		0
$275 million 4.80% Senior Notes Due July 27, 2026 | Senior notes
Debt Instrument [Line Items]
Face amount		$ 275,000,000
Interest rate (as a percent)		4.80%
$275 million 4.80% Senior Notes Due July 27, 2026 | Senior notes | Fair Value, Inputs, Level 2
Debt Instrument [Line Items]
Carrying Value		$ 273,600,000		273,500,000
Fair Value		257,200,000		249,700,000
Senior Notes, 5.125%, due 2031 | Senior notes
Debt Instrument [Line Items]
Face amount		$ 125,000,000
Interest rate (as a percent)	5.125%	5.125%
Repayments of debt	$ 125,000,000
Loss on extinguishment of debt			$ 3,200,000
Senior Notes, 5.125%, due 2031 | Senior notes | Fair Value, Inputs, Level 2
Debt Instrument [Line Items]
Carrying Value		$ 0		0
Fair Value		$ 0		$ 0

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Borrowings and Debt (Details) - Line of Credit - Revolving credit facility	Mar. 07, 2022
Debt Instrument [Line Items]
Interest coverage ratio	4.0
Minimum
Debt Instrument [Line Items]
Basis spread on variable rate	0.25%
Maximum
Debt Instrument [Line Items]
Basis spread on variable rate	0.375%
Fed Funds Effective Rate Overnight Index Swap Rate
Debt Instrument [Line Items]
Basis spread on variable rate	0.50%
Adjusted Term SOFR
Debt Instrument [Line Items]
Basis spread on variable rate	0.10%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate
Debt Instrument [Line Items]
Basis spread on variable rate	1.00%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Minimum
Debt Instrument [Line Items]
Basis spread on variable rate	1.50%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Maximum
Debt Instrument [Line Items]
Basis spread on variable rate	2.00%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate, Additional Rate | Minimum
Debt Instrument [Line Items]
Basis spread on variable rate	0.50%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate, Additional Rate | Maximum
Debt Instrument [Line Items]
Basis spread on variable rate	1.00%

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Leases - Narrative (Details)	Mar. 31, 2023	Mar. 31, 2022
Lessee, Lease, Description [Line Items]
Lease renewal term	5 years
Weighted average remaining lease term	10 years 2 months 12 days	11 years 2 months 12 days
Weighted average discount rate	3.54%	3.35%
Minimum
Lessee, Lease, Description [Line Items]
Remaining lease terms	1 year
Maximum
Lessee, Lease, Description [Line Items]
Remaining lease terms	11 years

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Leases - Summary of Lease Information (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Leases [Abstract]
Operating lease cost	$ 2.1	$ 2.5
Variable lease cost	0.0	0.0
Sublease income	0.0	(0.1)
Total operating lease expense	2.1	2.4
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	2.3	2.2
Right of use assets obtained in exchange for new operating lease liabilities	$ 2.8	$ 0.0

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Leases - Maturities of Operating Lease Liabilities (Details) $ in Millions	Mar. 31, 2023 USD ($)
Leases [Abstract]
2023 (excluding the three months ended March 31, 2023)	$ 7.0
2024	9.0
2025	8.8
2026	8.8
2027	8.4
Thereafter	49.6
Total lease payments	91.6
Less imputed interest	(14.6)
Total	$ 77.0

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Commitments and Contingencies (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022	Jan. 31, 2020
Commitments and Contingencies Disclosure [Abstract]
Cash and cash equivalents pertaining to wind-down	$ 3.6
Deposit guaranty on behalf of an Affiliate			$ 2.5
Guaranty liabilities	$ 0.0	$ 0.0

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Earnings Per Share - Calculation of Pro Forma Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Numerator:
Net income attributable to common stock	$ 12.0	$ 23.8
Denominator:
Weighted-average shares of common stock outstanding—basic (in shares)	41,444,200	43,969,713
Potential shares of common stock:
Weighted average diluted common stock outstanding (in shares)	42,710,577	45,327,390
Basic
Basic earnings per share of common stock attributable to controlling interests (in dollars per share)	$ 0.29	$ 0.54
Diluted
Diluted earnings per share of common stock attributable to controlling interests (in dollars per share)	$ 0.28	$ 0.53
Restricted stock units
Potential shares of common stock:
Restricted stock units/Employee stock options (in shares)	7,539	10,112
Employee stock options
Potential shares of common stock:
Restricted stock units/Employee stock options (in shares)	1,258,838	1,347,565

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Revenue - Schedule of Disaggregation of Revenue (Details) - Management fees - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Disaggregation of Revenue [Line Items]
Revenue:	$ 90.6	$ 102.2
Quant & Solutions | U.S.
Disaggregation of Revenue [Line Items]
Revenue:	67.9	77.0
Quant & Solutions | Non-U.S.
Disaggregation of Revenue [Line Items]
Revenue:	$ 22.7	$ 25.2

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Accumulated Other Comprehensive Income (Loss) - Components of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions		3 Months Ended
	Jan. 18, 2022	Mar. 31, 2023	Mar. 31, 2022
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]
Foreign currency translation adjustment		$ 0.7	$ (0.7)
Amortization related to derivatives securities, before tax		0.8	2.2
Tax impact		(0.2)	(0.6)
Total other comprehensive income		$ 1.3	0.9
Senior Notes, 5.125%, due 2031 | Senior notes
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]
Repayments of debt	$ 125.0
Interest rate (as a percent)	5.125%	5.125%
Amortization			1.3
Foreign currency translation adjustment
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]
Beginning balance		$ 1.7	4.8
Foreign currency translation adjustment		0.7	(0.7)
Amortization related to derivatives securities, before tax		0.0	0.0
Tax impact		0.0	0.0
Total other comprehensive income		0.7	(0.7)
Ending balance		2.4	4.1
Valuation and amortization of derivative securities
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]
Beginning balance		(12.3)	(15.6)
Foreign currency translation adjustment		0.0	0.0
Amortization related to derivatives securities, before tax		0.8	2.2
Tax impact		(0.2)	(0.6)
Total other comprehensive income		0.6	1.6
Ending balance		(11.7)	(14.0)
Total
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]
Beginning balance		(10.6)	(10.8)
Ending balance		$ (9.3)	$ (9.9)

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Derivatives and Hedging (Details) - USD ($) $ in Millions		3 Months Ended
	Jan. 18, 2022	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022	Dec. 31, 2021	Jul. 31, 2016	Jul. 31, 2015
Senior Notes, 5.125%, due 2031 | Senior notes
Derivative Instruments, Gain (Loss) [Line Items]
Repayments of debt	$ 125.0
Interest rate (as a percent)	5.125%	5.125%
Amortization			$ 1.3
Interest Expense
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) reclassified from AOCI to interest expense		$ 0.8	2.2
Loss amount reclassified within twelve months		3.5
Valuation and amortization of derivative securities
Derivative Instruments, Gain (Loss) [Line Items]
Other comprehensive income		$ (11.7)	$ (14.0)	$ (12.3)	$ (15.6)
Treasury Lock | Designated as Hedging Instrument
Derivative Instruments, Gain (Loss) [Line Items]
Notional amount							$ 300.0
Fair value of derivative						$ (34.4)

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Segments (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Segment Reporting Information [Line Items]
ENI revenue	$ 91.8	$ 112.2
ENI operating expenses	47.6	39.2
Earnings Before Variable Compensation	44.2	73.0
Variable compensation	23.2	27.9
Operating Earnings After Variable Compensation	21.0	45.1
Affiliate key employee distributions	1.2	1.9
Earnings after Affiliate key employee distributions	19.8	43.2
Net interest expense	(3.8)	(6.5)
Interest income	1.1	0.0
Investment income (loss)	0.3	(0.1)
Loss on extinguishment of debt	0.0	(3.2)
Income tax expense	(5.1)	(9.6)
Net income attributable to controlling interests	12.0	23.8
Operating Segments | Quant & Solutions
Segment Reporting Information [Line Items]
ENI revenue	91.1	112.2
ENI operating expenses	43.6	41.1
Earnings Before Variable Compensation	47.5	71.1
Variable compensation	22.5	26.3
Operating Earnings After Variable Compensation	25.0	44.8
Affiliate key employee distributions	1.2	1.9
Earnings after Affiliate key employee distributions	23.8	42.9
Net interest expense	0.0	0.0
Interest income	0.0
Investment income (loss)		0.0
Loss on extinguishment of debt		0.0
Income tax expense	0.0	0.0
Net income attributable to controlling interests	23.8	42.9
Other
Segment Reporting Information [Line Items]
ENI revenue	0.0	0.0
ENI operating expenses	3.5	4.5
Earnings Before Variable Compensation	(3.5)	(4.5)
Variable compensation	0.7	1.6
Operating Earnings After Variable Compensation	(4.2)	(6.1)
Affiliate key employee distributions	0.0	0.0
Earnings after Affiliate key employee distributions	(4.2)	(6.1)
Net interest expense	(3.4)	(4.6)
Interest income	0.0
Investment income (loss)		0.0
Loss on extinguishment of debt		0.0
Income tax expense	(4.4)	(8.8)
Net income attributable to controlling interests	(12.0)	(19.5)
Reconciling Adjustments
Segment Reporting Information [Line Items]
ENI revenue	0.7	0.0
ENI operating expenses	0.5	(6.4)
Earnings Before Variable Compensation	0.2	6.4
Variable compensation	0.0	0.0
Operating Earnings After Variable Compensation	0.2	6.4
Affiliate key employee distributions	0.0	0.0
Earnings after Affiliate key employee distributions	0.2	6.4
Net interest expense	(0.4)	(1.9)
Interest income	1.1
Investment income (loss)		(0.1)
Loss on extinguishment of debt		(3.2)
Income tax expense	(0.7)	(0.8)
Net income attributable to controlling interests	$ 0.2	$ 0.4