Goldman Sachs Group Inc. recently revamped its asset-management compensation structure significantly, according to AdvisorHub. 

The restructuring, introduced in the past few months, aims to increase the rewards for asset-management teams when their funds achieve superior performance. These changes will result in a higher allocation of profits for the investment teams directly accountable for the success of Goldman's alternative investment funds. 

In the updated compensation structure at Goldman Sachs, the share of performance rewards, known as carried interest, is being reconfigured. Investment teams will now receive a higher portion of the carry pool, ranging from 40% to 50%, compared to the previous range of 30% to 40% for many of the funds. This percentage varies based on the type and size of the fund.

Goldman Sachs, responsible for managing $267 billion in fee-earning alternative assets, claims that it is making this change to align its compensation practices more closely with rival investment firms. Additionally, this adjustment is part of its strategy to rely more on third-party capital to fund their investment activities instead of their own balance sheet. It is also seen as a move to retain talent and prevent further departures to competing firms.

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