Harvey Schwartz : So, it’s one of the reasons when we were going through our remarks in the prepared pages, we put out a range. Look, this is super important. We’re going to execute on this compensation change very deliberately. The range really gives us the flexibility to execute on this deliberately. Look, we have no idea what the market backdrop will look like. But look, I think you should walk away from this thinking our intent is for this to be DE neutral. The vast majority of our employees will not be impacted. There will be some variability in compensation for our senior folks in year-to-year. But if you look at it over a couple of year period, our intent is for compensation to not be up or not be down, and that’s how we’ll manage it.
I think it’s also important to point out, and I mentioned that in my remarks, the senior people that will have some variability in their compensation, we did grant them performance stock units. So we really have great alignment with our senior people. These performance stock units are really shareholder friendly. They only vest upon share price appreciation. And quite frankly, I think everyone here, and on the call hopes they actually do best because they’re very shareholder friendly instrument. In terms of the 2024, $1.1 billion FRE target, you look at the 25% step-up from our 859 FRE in 2023, we feel very good about it. It really is three components. It’s growth, which we’re very focused on. Two, it’s the compensation change and third, we will continue to manage the business prudently in terms of expenses.
We have no intention of cutting to the bone, but we will manage the business prudently, but it is a growth, prudent expense management and compensation changes.
Operator: Thank you. Our next question comes from Chris Kotowski with Oppenheimer & Company. Your line is open.
Chris Kotowski : Yeah. Can you hear me?
Harvey Schwartz : Yeah, hey, Chris. Good morning.
Chris Kotowski : Hey. Good morning. I was wondering under your $40 billion fundraising target, if you could drill down into the composition of that a bit more and in particular, kind of — even if you can’t give us the numbers and — but kind of like the — what should we expect during the course of the year relating to the — to the two big flagship funds in Europe and Asia that you’re raising?
Harvey Schwartz : Yeah. So I think you should think about it broadly across the platform. We have a lot of momentum, as you saw coming off the record fundraising the activity in the fourth quarter. But you should expect to see really good fundraising activity in credit across the private equity platform, our real estate business, our private equity business across infrastructure, the whole space. So we built this model up across the entire franchise. I think in private equity, like the rest of the industry, specifically, I’m talking about the narrow definition of private equity, corporate private equity. I think there’ll still be headwinds in the industry for that. But across our platform, we feel good about the $40 billion number. I will emphasize with John again, we report these numbers quarterly. We just don’t think about fundraising. We don’t run the business for a quarter but we feel good about the momentum in the business, really good about it.
John Redett : And the only thing I’d add is in the solutions business, we have a couple of funds in the market. And we’re showing — we’re seeing great momentum in solutions as well in addition to private equity and credit.
Chris Kotowski : Okay. Great. And then just kind of curious, the $1.4 billion share buyback authorization, is that conceived of as a one-year authorization? Or is that more flexible? Because when you add the $1.4 billion and you add the dividend, it’s actually — it ends up speaking for quite a lot of your likely DE at the end of the year?
Harvey Schwartz : Yeah. So again, the way John framed this, and let’s just take a step back. I think many of you have known me for years in terms of how I think around the discipline of capital. But just taking a step back, when we think about capital, we think about growth and shareholder alignment and returning capital to shareholders and investing in growth. And we think about this really purely through the events of really where is the marginal ROI. So the first thing that’s most important about this is the investing in growth and we have capital available for that. This allocation to share repurchase reflects the fact that when we look at the enterprise value of our firm, it’s quite compelling to return capital to shareholders.
So we haven’t narrowed this to one year for sure, but what we want to do is give ourselves the full range of flexibility. We’re going to be very disciplined, very systematic about this in terms of driving growth, returning capital to shareholders and finding the balance, effectively the efficient frontier of where that exists. And that’s how we’re thinking about it. But it’s not a one year because as you implied, in addition to the dividend, which is $500 million this year, that’s how we’re thinking about it. But again, as John said earlier, you should expect to see us be active buying stock back.
Chris Kotowski : Okay, great. That’s it for me. Thank you.
Operator: Thank you. [Operator Instructions] Our next question comes from Brian McKenna with Citizens JMP. Your line is open.
Harvey Schwartz : Hi, Brian.
