Chinese traders turn their sights on executive pay
With salaries rising faster than profits, disparity becomes new battleground for irate investors
Mainland investors who are grappling with a slumping stock market have expressed concern over what they fear is "an enemy within", after seeing details of executive pay that spurred an uproar over corporate governance.
The mainland's stock market has been mired in a bearish mood for the past three years, with most investors venting their anger on a flurry of initial public offerings that soaked up massive funds from existing holdings.
"IPOs were seen as one of the main reasons for the market's fall. But it might be the nasty bosses of the companies that stopped us from making money," said Liu Zhiming, a retail investor. "If you look at their salaries, you will totally lose confidence."
According to data provider iFind, senior executives of mainland-listed firms gained an average 6.9 per cent pay rise last year and their total payments were valued at about 9 billion yuan (HK$11.3 billion). The growth in salaries of company bosses far exceeded a 2 per cent profit rise recorded in the same year.
"Investors have reason to protest against the pay rises," said West China Securities trader Wei Wei.
Nearly 70 per cent of listed firms raised the salaries paid to the senior executives, according to iFind.