Mission Statement, Vision, & Core Values (2024) of Federated Hermes, Inc. (FHI)

An Overview of Federated Hermes, Inc. (FHI)

General Summary of Federated Hermes, Inc. (FHI)

Federated Hermes, Inc. is a global leader in active, responsible investing, managing approximately $800.5 billion in assets as of September 30, 2024. The company traces its origins back to 1955 and has evolved significantly over the decades, focusing on investment management and fund administration services. Federated Hermes offers a diverse range of products including mutual funds, separate accounts, and alternative investments, catering to both institutional and retail clients.

As of 2024, the company’s primary revenue streams are derived from advising Federated Hermes Funds and Separate Accounts in both domestic and international public and private markets. In addition, Federated Hermes provides administrative services, distribution, shareholder servicing, stewardship, and real estate development services.

Company's Financial Performance in the Latest Financial Reports

In the most recent financial reporting period, Federated Hermes reported a revenue of $1.207 billion for the nine months ended September 30, 2024, reflecting a slight decrease from $1.218 billion in the same period in 2023. The company experienced a decrease of $10.7 million in revenue primarily due to a reduction in carried interest and lower average equity assets. However, there was a significant increase in money market revenue, which rose by $60.3 million due to higher average money market assets.

Net income attributable to Federated Hermes, Inc. for the nine-month period was $183.6 million, a decrease from $216.8 million in 2023. The diluted earnings per share for the same period decreased to $2.20 from $2.44 in the prior year. The effective tax rate for the nine-month period was 31.5%, compared to 25.6% in 2023.

Operating expenses increased by $23.3 million for the nine-month period, largely driven by an impairment of a foreign intangible asset. Total operating expenses for this period were $956.4 million, with significant contributions from systems and communications, professional service fees, and intangible asset-related expenses.

Introduction to Company as One of the Leading Companies in the Industry

Federated Hermes stands out as one of the leading firms in the investment management industry, recognized for its commitment to responsible investing. The company has a robust portfolio that includes a variety of investment strategies, catering to a diverse client base ranging from individual investors to large institutions.

As of September 30, 2024, the company’s assets under management reflect its strong market position, with a considerable percentage attributed to money market assets, which accounted for 51% of total revenue. The company's focus on stewardship and sustainability further enhances its reputation and aligns with growing investor demand for responsible investment options.

To understand more about Federated Hermes' strategies, performance metrics, and market position, readers are encouraged to explore the detailed sections below.

Mission Statement of Federated Hermes, Inc. (FHI)

Mission Statement of Federated Hermes, Inc. (FHI)

The mission statement of Federated Hermes, Inc. (FHI) serves as a guiding framework for the company's strategic objectives and corporate ethos. It reflects the organization’s commitment to delivering high-quality investment solutions while adhering to responsible and sustainable practices. As of 2024, FHI emphasizes its role as a leader in active, responsible investing, aligning with global trends and client expectations. This mission is critical in navigating the complexities of the financial landscape and ensuring long-term growth and stability.

Core Component 1: Active Investment Management

At the heart of FHI's mission is the commitment to active investment management. The company manages approximately $800.5 billion in assets as of September 30, 2024. This approach allows FHI to tailor its investment strategies to market conditions, aiming to achieve superior returns for its clients. The focus on active management is evident in the diverse array of funds offered, including money market funds, equity, and fixed-income assets.

Core Component 2: Responsible Investing

FHI's mission statement underscores a dedication to responsible investing. The company integrates environmental, social, and governance (ESG) factors into its investment decisions, aiming to foster sustainable growth. In 2024, FHI reported that 75% of its investment offerings incorporate ESG criteria. This commitment not only aligns with global sustainability goals but also meets the increasing demand from investors for ethical investment options.

Core Component 3: Client-Centric Approach

Another pivotal element of FHI's mission is its client-centric approach. The firm prioritizes understanding client needs and delivering tailored solutions. In 2024, FHI generated $1.2 billion in total revenue, with a significant portion coming from advisory services. This revenue reflects the effectiveness of its strategy to build long-term relationships with clients by offering personalized investment strategies and robust support services.

FHI's mission statement effectively encapsulates its strategic goals and operational focus, setting a clear direction for its business as it adapts to the evolving financial landscape in 2024.

Vision Statement of Federated Hermes, Inc. (FHI)

Vision Statement Overview

The vision statement of Federated Hermes, Inc. (FHI) outlines its commitment to being a global leader in active, responsible investing. As of 2024, the company aims to enhance its influence in sustainable investment practices while maintaining its financial performance.

Global Leadership in Active Investment

Federated Hermes aspires to be recognized as a premier active investment manager, managing approximately $800.5 billion in assets as of September 30, 2024. This leadership position allows the company to influence investment trends globally, particularly in the area of ESG (Environmental, Social, and Governance) investing.

Commitment to Responsible Investing

The company's vision emphasizes a strong commitment to responsible investing. This is reflected in its investment strategies that prioritize sustainability, with a significant portion of its managed assets allocated to socially responsible investments. For instance, in the nine months ended September 30, 2024, Federated Hermes generated approximately $1.2 billion in revenue, driven largely by its stewardship and ESG initiatives.

Innovative Investment Solutions

Federated Hermes is dedicated to providing innovative investment solutions that meet evolving client needs. The company continues to invest in technology and infrastructure, with an expected expenditure of approximately $295 million over the next three years to support technology-driven initiatives. This investment is crucial for developing advanced analytics and enhancing client engagement.

Focus on Client-Centric Approach

The vision of Federated Hermes includes a strong focus on client relationships, aiming to deliver tailored investment solutions that align with clients' financial goals. The company reports a significant reliance on key intermediaries, with approximately 10% of total revenue derived from services provided to The Bank of New York Corporation.

Strategic Growth and Sustainability

Federated Hermes aims for strategic growth while maintaining sustainability across its operations. The effective tax rate for the company was reported at 26.3% for the three-month period ending September 30, 2024, indicating a stable financial position to support growth initiatives. The company also authorized a share repurchase program of up to 5 million shares, reflecting confidence in its long-term strategy.

Financial Performance Indicators

Conclusion of Vision Statement Components

Federated Hermes, Inc. aims to solidify its position as a leader in active, responsible investing, focusing on innovative solutions and client-centric approaches while emphasizing sustainability and strategic growth. The company’s vision is supported by robust financial performance and a commitment to enhancing stakeholder value.

Core Values of Federated Hermes, Inc. (FHI)

Integrity

Federated Hermes, Inc. (FHI) emphasizes integrity as a core value, underscoring the importance of ethical behavior and transparency in all business dealings. This commitment is reflected in their governance structure and operational practices.

In 2024, FHI implemented a rigorous compliance framework, ensuring adherence to regulatory standards, which has been instrumental in maintaining investor trust. The company reported compliance with all covenants related to its $350 million unsecured senior notes, demonstrating its commitment to financial integrity.

Stewardship

Stewardship is central to FHI's mission. The company actively engages in responsible investing, managing $800.5 billion in assets as of September 30, 2024. This includes a focus on sustainable investment strategies that consider environmental, social, and governance (ESG) factors.

FHI has initiated various stewardship programs, including a commitment to reducing carbon emissions in its investment portfolios. The firm reported a 25% increase in its sustainable asset management services compared to the previous year.

Collaboration

Collaboration is vital in driving innovation and achieving shared goals at FHI. The company has fostered a culture of teamwork, which has led to enhanced service delivery and client satisfaction. In 2024, FHI launched a cross-departmental initiative that improved operational efficiency, resulting in a 15% reduction in processing times for client transactions.

The company also reported a 10% increase in employee engagement scores, reflecting improved collaboration and communication across teams.

Excellence

FHI's pursuit of excellence is evident in its operational performance and client service standards. The firm achieved a net income of $87.5 million for the third quarter of 2024, up from $75 million in the same period of 2023. This growth is attributed to improved investment performance and client retention strategies.

The company also received recognition for its services, with several Federated Hermes Funds being rated among the top 10% in their respective categories by independent rating agencies.

Accountability

Accountability is a cornerstone of FHI's corporate culture. The company holds its employees and management responsible for their actions and decisions. In 2024, FHI disclosed a comprehensive accountability report that highlighted its performance metrics, including a 30% increase in shareholder returns year-over-year.

Furthermore, FHI has established a clear framework for reporting and addressing any shortcomings in its operations, which has contributed to a 20% decrease in operational risks reported by the risk management team.

Article updated on 8 Nov 2024

Resources:

• Federated Hermes, Inc. (FHI) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Federated Hermes, Inc. (FHI)' financial performance, including balance sheets, income statements, and cash flow statements.
• SEC Filings – View Federated Hermes, Inc. (FHI)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.