One year into his tenure, the Vanguard CEO reflects on the push to get investors into private securities, the future of advice at Vanguard, and whether the firm has addressed its customer service and technology issues.
We’re taping this podcast at the Morningstar Investment Conference, where we’re delighted to be joined by Vanguard CEO Salim Ramji, who joined Vanguard just about a year ago. Prior to joining Vanguard, Salim was a senior leader at BlackRock, where his most recent position was as global head of iShares and index investing. Before that, he was a senior partner at McKinsey & Company. Salim started his career as a lawyer at Clifford Chance in London and Hong Kong.
Vanguard Announces Appointment of Salim Ramji as New CEO
Vanguard Chooses an Outsider as Its New CEO, by Daniel Sotiroff, Morningstar.com, May 14, 2024.
Vanguard’s New CEO: The Story Everyone Is Missing, by Susan Dziubinski and Daniel Sotiroff, Morningstar.com, April 22, 2025.
Ramji Discusses Vanguard at 50 With Wall Street Week, May 22, 2025.
2025 Morningstar Investment Conference: How to Invest Today, Laura Lallos, Morningstar.com, June 27, 2025.
Vanguard CEO on Outages, Expansion Plans and Culture, Bloomberg, Aug. 5, 2024.
2025 MIC: Vanguard CEO Salim Ramji on AI, Fees, and the Future of the Firm, Hedge Fund Alpha, June 27, 2025.
Vanguard Unveils Generative AI Client Summaries for Financial Advisors, Vanguard, May 5, 2025.
Automated Investing With Digital Advisor
The Best Robo-Advisors of 2025, Dan Culloton, Morningstar.com, May 2, 2025.
How Vanguard plans to play disruptor again, by Brooke Masters, Financial Times, Feb. 11, 2025.
Vanguard CEO Salim Ramji cools the jets on private assets, by Tania Mitra, Citywire, June 26, 2025.
Vanguard CEO says its public-private efforts rooted in partnerships, not acquisitions, by Rob Kozlowski, Pensions & Investments, June 26, 2025.
Vanguard sets sights on private markets (at the right price), by Lachlan Maddock, Investment Magazine, March 5, 2025.
Christine Benz: Hi, and welcome to The Long View podcast. I’m Christine Benz, Director of Personal Finance and Retirement Planning for Morningstar.
Dan Lefkovitz: And I’m Dan Lefkowitz, strategist for Morningstar Indexes.
Benz: We’re taping this podcast at the Morningstar Investment Conference, where we’re delighted to be joined by Vanguard CEO Salim Ramji, who joined Vanguard just about a year ago. Prior to joining Vanguard, Salim was a senior leader at BlackRock, where his most recent position was as global head of iShares and index investing. Before that, he was a senior partner at McKinsey & Company. Salim started his career as a lawyer at Clifford Chance in London and Hong Kong. Salim Ramji, welcome to The Long View.
Salim Ramji: Well, thanks for having me here. It’s great to be in Chicago, and it’s great to be at the Morningstar Conference.
Benz: Well, we’re thrilled to have you here. So you’re the first outsider to have helmed Vanguard. I wonder if you can talk about what you see as kind of the main challenges of coming in as an outsider and what you see as the main opportunities of maybe that fresh perspective.
Ramji: Yeah. What I would say is that Vanguard has been a really welcoming place. And so when I first kind of arrived on campus back in May of last year, I was wondering, I’m sure the crew were wondering about me at the same time. And what I’ve really tried to focus on for my first year is just spending a lot of time with our crew and also spending a lot of time with our clients. And Vanguard’s been an extremely successful company in delivering kind of the right outcomes for our clients for the 49 years before I arrived at the scene. And so I’ve been spending a lot of time just really understanding why and what are the reasons kind of behind that and what’s made the company special so that we can maintain and preserve all of those aspects for the next 10 years, the next 20 years, and kind of well beyond that.
And at the same time, I think that, to your question, there’s a lot of opportunity because if you go back to our mission around helping investors achieve investment success, that there are so many more things that we can do to help make that happen. I can see opportunities in fixed income, in helping people save, but also perhaps most fundamentally in just being able to provide advice in a much more accessible way than might otherwise be possible.
Lefkovitz: So it sounds like you spent a lot of time getting to know the crew and learning the culture. What would you say, as you’re a year and a month in, are your biggest achievements? What’s top of the to-do list?
Ramji: What I would say is part of my kind of getting to know and understand the crew and the culture. And I’m not sure I’d call it an achievement, but I’m at least proud of it, which is just really, I think I have a much deeper and better appreciation for some of the stuff that I talked to Christine about. The thing that surprised me the most is, I’ve always kind of understood Vanguard to be a very mission-driven, purpose-driven company. We’re owned by our clients. But I will say, I probably entered with a bit of skepticism about, is it really true? I’ve been working in and around financial services for like 25-plus years. And, you know, we’ve all seen a lot of companies that espouse a purpose, but perhaps it dilutes over time. It’s been 30 years since Jack Bogle was the CEO of the company. It’s been six years since he passed. And I think one of the really amazing achievements of Vanguard, at least for someone who’s newly on the inside, is that sense of purpose, that sense of culture is very rich, is very alive.
And so just understanding the idealism of the place, just understanding why people come to work, understanding what people are really excited about. We announced, as you know, because Morningstar had talked about it, back in February, we announced kind of the largest fee cuts in our history. Like, in one part, that was satisfying. In another part, it’s the 2,000th time someone at Vanguard has announced a reduction in price. So there’s nothing unusual, if you will, about that beyond the size and magnitude. What was unusual for me was just to understand what a joyous day it was on campus. Our crew were really excited about it. Our board of directors were really excited about it. All of us in the senior team were really excited about it. And that’s a really unusual thing. Usually people at a company don’t get super excited when you’re cutting fees, but for us it was a moment, much like, every 2,000 times before we’d done it, but it was a real cultural moment, a real affirmation of like, this is what you get for being owned by clients, and this is the clarity, at least in terms of the mission. And that was a proud moment, if you will. And it was great to just understand that, not just in the fee cut, but in the cultural affinity with doing the right thing and being able to kind of benefit the clients as owners, as well as investors.
Benz: So sticking with culture, what have been the biggest culture shocks for you coming from BlackRock and moving to Vanguard? What do you perceive as the major differences?
Ramji: Yeah, it’s hard to describe because I think that Vanguard is such an unusual firm. You know, I worked at another firm. I’d advised many firms in kind of my prior lives. And the sense of culture is different here. And I think some of it goes back to the original genius of the design, which is we’re owned by our clients. And I think what that gives us, which is different than any private firm or different than any public firm, is the singularity between the client and the shareholder. And as a result, the culture becomes really reinforcing in a way that we celebrate fee cuts. We don’t follow trends. We follow what are things that will enable clients to achieve investment success or enable clients to have an advocate on their side. And so there are a lot of things that we do at Vanguard, which are purposefully different. And it really struck me, not just in the ethos and the archives of Bogle, which I’ve now had a lot of access to and there’s some marvelous old memos and old speeches about, but just in the day to day, in terms of how we think about what products should we launch, what shouldn’t we do, what investments do we need to make behind things like technology? How do we price certain services? And it’s very unusual. I think you can go back to the structure. You can see the reinforcing in the culture. But I think it’s our client ownership, coupled with a lot of the cultural ethos and a lot of the things that we’ve been doing for many years that have really reinforced the difference. So I think one of the things that makes Vanguard special is I haven’t encountered any company like this. And it makes for just really kind of special and unusual place. But I think that’s part of what’s been true, not just this year, but for decades.
Lefkovitz: The question that’s probably top of mind for a lot of our listeners, where do things stand with regard to the customer service challenges that Vanguard has been experiencing?
Ramji: Yeah, no, it’s a good question. We have been doing for the past three years, two years before I started, a whole series of investments, particularly in technology and particularly in our technology stack. I think we’re turning the corner, but this isn’t a destination. This is a constant journey. What the technology changes have allowed us to do, and now virtually, I think it’s like 90%-plus of our personal investor platform is cloud-native, and that was really hard, laborious, costly work to make that happen. But we think we now have the most modern kind of infrastructure stack in the industry. What it allows us to do, beyond all the kind of high levels of resilience that a platform like that now has, is be able to make improvements on a lot of the front-end design and a lot of the front-end user experience. And so we’ve already been doing that over the past six months.
Back in March, we started to see some good early signs of progress. J.D. Power ranked us number one for the first time in a while in terms of our client experience for DIY investors, but it also then gives us the ability to keep innovating, making the front-end web or mobile applications better, more intuitive, more customized. So maybe different if you’re a kind of wealth management client with some complexity versus if you’re a first-time investor. And what the really exciting part of it is, is it gives us some incredible opportunity to then put AI applications on top of that, because our tech stack is now modernized in a way that just wouldn’t have been possible two years ago or three years ago.
So it’s not that we’re declaring victory by any means. We’re on a journey. We’ve been doing it deliberately and methodically. We appreciate all of our clients’ patience with it, but I think that clients are starting to see some of the results, and we’re continuing to invest in a major way to make sure we continue to distinguish ourselves in a positive way on that front.
Benz: You mentioned AI. Can you provide any specific examples of how you’re using AI to help clients?
Ramji: We have, like many companies, a lot of things in pilot, a lot of different applications, a few dozen around it. The one thing that we just released in April, it’s an AI-based tool that allows advisors to communicate in a customized way with their clients. So how do you take all of the market views, synthesized views that you might get from Vanguard, you might get from a whole range of firms out there, and be able to distill it down into one or two pages, but you customize it to a client. You may be a really confident client. Dan may be anxious and in retirement. I may be a first-time investor and just like want to understand what’s going on. And some of these capabilities which we built for our own advisor team, we’ve now made available to all advisors, including those here at the conference, who are kind of Vanguard clients within their portfolios. And it’s been really, really positive. We’ve gotten really great feedback, whether it’s here at the conference or even just through our interactions with them. And I describe that as a first step of taking what is often complicated, noisy information and making it simple and more personalized.
Honestly, Christine, we’re holding back on some of the pure client-facing, direct client-facing applications. They’re really good. But we’re holding back on them because we want to make sure we’re doing it in a responsible kind of way. And so we’ve worked out any kinks, hallucinations, and the like before we do it. But just the application of that, I think can be kind of very, very significant for what we do in advice, what we do for first time investors. And honestly, it’s sort of on mission, if you will, because for a very long time Vanguard has taken the complicated and tried to make it simple and accessible. And I think that the AI applications, whether it’s with advisors, whether it’s with our direct consumers—I was with a whole group of our workplace clients last night, and so just think of the complexity of retirement plans and particularly if companies have merged and want to distill that. We have all those applications at the ready. We have a tech stack that’s able to handle it, but we’re just working it through ourselves and with clients and others just to make sure we get it right because it’s really important we do it responsibly.
Lefkovitz: Financial advice has been described as Vanguard’s engine number two. I’m curious how you balance serving investors, empowering them in their own practice versus providing financial advice yourself.
Ramji: Yeah, and it was something, you know, if we got the history right, we started out about 10 years ago. And some of the original logic, which still applies, is that for some clients, the key to investment success is advice. And I’ve come across a number of clients both that I’ve met with our advisors or even when I’m listening in on calls who may have started out as self-directed investors that maybe in retirement they want more help and more advice than they needed in accumulation. Maybe they’re thinking about how to enable the next generation, their kids or grandkids, to interact with investments, and so they’re looking for advice not necessarily for themselves but for others in their family. And so part of why we started that offering 10 years ago was to really enable clients who wanted that service from Vanguard to be able to have access to it rather than having to go somewhere else.
And what we’re really innovating on beyond kind of that service, and this goes back to AI, we’ve got a digital advice platform. Since I’m here at Morningstar, it was highly rated by Morningstar. And back in September, we dropped the minimum account size to $100. So for $100 you can now get a diversified portfolio of underlying ETFs. You can get a digital advice capability. And the thinking behind that was that everybody should have access to good advice. And it shouldn’t just be the preserve of the very affluent or the folks that very high-net-worth advisors want to serve. And if you think as you look out over the next 10 years there’s going to be fewer advisors and more demand for their services. And so if we’re to help more and more people achieve investment success who need advice we’re going to have to do that digitally. And I think we want to take this digital advice capability that’s already well regarded by clients, by Morningstar, and others and then embed a lot of AI capabilities into it to make it even more personalized, even more capable than it is today. And I think that’s beyond dropping the minimum to $100. I think that’s the most exciting next development for digital advice is how do you make it much more enabled by AI and enable clients, whether they have $100, $1,000, $10,000 to be able to interact with it much better.
Benz: So we want to switch over to discuss investing. And I wanted to get your perspective on whether the balance has shifted a little bit too much in the direction of complexity in investor portfolios. There’s been a big push to get smaller investors in private investments, whether private equity or credit. I’d like your take on complexity writ large but also specifically the private market’s exposure and how you see that fitting into investor portfolios, if you do.
Ramji: Yeah, I mean, look, as a general matter, complexity for decades has really been a mask for charging higher fees. And I think part of what Vanguard’s been about has not just been about low fees, but simplicity. And I think that’s going to be a really important feature of Vanguard going forward as well around being able to keep things simple, to help clients invest for the first time, to help clients continue to invest in a good way for the long term.
There will be some segments of clients, perhaps at the very high-net-worth area, for whom some exposure to private markets could make sense. But for us, it still has to adhere to the Vanguard principles. It’s got to be good quality. It’s got to be at a low fee. And it’s got to be done in a way which is intelligible and simpler, if you will, than the client could otherwise get. And we’re starting to experiment, if you will, around could we provide access to private market investors to certain segments of clients that fit the profile? And we’ll see how we get in terms of that journey.
What we do know is that for the right clients, with the right product, at the right fee, it can be additive to the overall risk/return profile of their portfolio. But there’s a lot of work to make sure that those conditions are met. And so that’s an area that I’d say we’re experimenting and learning about.
But you asked the question, Christine, across the industry, I think it’s going to be some time, like a long time, longer than most people expect before this really goes mainstream in a big way. And I think a lot of it is not just the complexity and the fees, but just the complexity of consuming the product. Mutual fund is really easy to consume. Now, we’ve been at it for like 101 years. Right. And ETF is pretty easy to consume, but we’re now in our fourth decade of ETFs. And so some of the things that people look at, appropriately, as democratizing investing, like mutual funds and ETFs, these are decades in the making. And so, any new features, even good features, to be able to add often take longer than people expect. But that’s why we just wanted to start kind of looking and understanding it because, done well, I think it can be additive. But there’s a lot of work and thinking and research to satisfy the “done well” in the Vanguard way.
Lefkovitz: Crypto is an area where, before your arrival, Vanguard kind of drew a line in the sand and refused to add cryptocurrency ETFs to the platform. I’m curious how what the decision-making framework is like, how you go about approaching a new sort of asset class or asset.
Ramji: Yeah, it was pretty straightforward. And, you know, Greg Davis, our CIO, and I had talked about it kind of early in my arrival. And at Vanguard, we like things that, we like investments that deliver cash flow or have the prospect of delivering cash flow. That could be cash, could be bonds, could be equities, could, over time, if the circumstances are right, be private markets. We don’t like things that don’t. We don’t have a gold ETF. We don’t have a silver ETF. And so it’s a logical extension then as to why we don’t have ETFs in other things that don’t either deliver cash flow or have the prospect of delivering cash flow. And that’s OK. The market’s well served. Investors can decide. But we also want to be clear about what our own investing philosophy and our own investing thinking is. And we’re OK not being everything to everybody. And there are certain things like either we don’t fit our investment philosophy or we don’t think we have particular scale or expertise in. And so that’s where I’d put some of those types of ETFs in that bucket.
Benz: Vanguard has put a big emphasis on active fixed-income management in the past couple of years. Can you give us some background on what’s driving that interest? And also how do you think about how advisors and their clients should decide whether to go passive with their fixed-income exposure or go active? Are there categories where you think active is better for the situation?
Ramji: It’s a great question. And one of the things honestly that surprised me a year ago, and I sat down with Sara Devereux, our fixed-income CIO, and I’ve gone through the performance numbers, the investment process, and the like. And we’re really good at it. We’ve actually been doing it for 40 years. Bogle started our fixed-income area. 98% of our active fixed-income today is in the lowest price decile. 91% of our active fixed income outperforms its peers over the past decade. Those are two extraordinary numbers, but they’re highly related.
And I think the opportunity is first and foremost to help clients build the right fixed-income exposure in their portfolio. Some of that is indexed, and some of that is active. But I think as those numbers speak to, they really are empirical proof of the cost matters hypothesis that you don’t have to trade off quality for price. In fact, as Bogle said, in investing, you get what you don’t pay for. And I think the thing that’s really exciting for us is the ability to deliver active fixed income at a quarter of the fee that what the industry charges. We also are really proud of our index fixed-income capabilities, which are even cheaper than our active fixed-income capabilities.
But there are segments of the fixed-income market where active management at the right fee can work well. Munis are a really great example of where empirically in our own portfolios that’s been proven to be true. But it also goes to our approach to risk management, which is that if you’ve got a low fee hurdle to overcome, you can be much more disciplined about security selection. You can be much more disciplined about the alpha-generating investments that you make. And you’re not having to take big swings on where you think rates are going to be or big swings on certain credits or certain exposures. You’re able to be disciplined and methodical because you know you don’t have to overcome a huge fee barrier to be able to deliver outperformance. And I think that’s what we’ve been doing certainly for the past 10 years. I haven’t looked at the 40-year record, but I’m sure it also speaks to it.
But what it really gets to, Christine, is I think the whole discussion of active and index is often a misnomer. It’s a discussion around price. And if we can provide high-quality active management at a low fee and high-quality index management at a low fee, what we’re doing for financial advisors or individual investors is providing them the choice that they can use to be able to build a portfolio without having to suffer some of the fees that they’ve had to endure, particularly in active fixed income.
Lefkovitz: How is Vanguard helping investors navigate the transition from accumulation, building wealth, to decumulation, spending and giving and leaving a legacy?
Ramji: It’s hard. I think it was Bill Sharpe who said that it was the most intractable problem in finance about how to think about the decumulation. And we’ve got tools that we give for self-directed investors. We’ve got tools we give to our advisors to help kind of with what’s the right way to decumulate. It’s still a really hard problem. One of the hardest problems, though, is just helping clients get over the anxiety around it. I mean honestly some of the most both heartbreaking and inspiring calls that I’ve been on at Vanguard have been clients who are in retirement, who have saved wealth, who have adhered to all of the Vanguard principles over 20, 30 years, and they’re just not spending what they should, and they’re not living the life and retirement that they should afford.
The inspiring part is, and this is often where an advisor comes in because it’s hard to do this through a tool, that if they have an advisor they trust, if they have confidence that that advisor is looking out for their interest, is a true fiduciary, that advisor can often help them get over the anxiety, can help them understand that it’s OK to go on that vacation. It’s OK to give this gift for your grandkid’s birthday, and it’s just, you can see, in many cases, the relief on a client’s face to know that there’s someone they trust saying it’s OK. So I think it’s a combination. First, it’s a really hard thing, and I don’t pretend that we’ve solved it or even the industry solved it, but beyond all the tools and the capabilities and all of those pieces, a lot of what we’re helping with is to help clients understand when it’s OK, when it’s not, but in many cases, it’s just helping them enjoy the retirement that many clients have saved and invested for but just don’t quite know if they’re spending the right amount, and I think that’s really the challenge, the opportunity, for us, for, I think, the whole industry, but that’s at least how we’re approaching it.
Benz: Our last question we’d like to ask: What are the key things you worry about with respect to Vanguard?
Ramji: The things that I want to make sure endure, right, if it goes back to the thing that surprised me the most was the sense of culture, the sense of mission. I want to make sure that whoever’s sitting here 10 years from now, 15 years from now, feels that same sense of mission, that same sense of purpose that I felt, that people 10 years ago felt, that people 20 years ago felt into the future, and I think that it’s managing the duality of what that is, and there are places where our crew are really excited to evolve and to move into, could be fixed income, could be more in advice, could be more in savings, just as we’ve evolved over the years in things like ETFs or retirement plans, or observing financial advisors who don’t work at Vanguard, and I think it’s really balancing that duality, if you will. We want to be true to who we are. I talked a lot about my impressions of Vanguard being a special and unique place. I want that to continue, and there are some things that we’re investing to do better in. There are some things that I think that we can continue to make a really big impact to investors in, like fixed income or savings, and there are some things that we at Vanguard and we at the industry really need to figure out around how do you help advise people in retirement? And it’s how do you do both?
How do you both continue to evolve, continue to serve investors needs well, and how do you still remain true to who we are as a company and as an institution, and it’s really managing that duality is always the thing, I’d say, that’s probably top of mind—along with cybersecurity and other kind of things. But that’s certainly going to be an enduring thing that’s at the top of my mind.
Benz: Salim, thank you so much for taking time out of your schedule to be with us today. Thank you.
Ramji: It was great to be here. Thanks.
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