Directors of red-chip companies have more vested interest in how their companies perform than their H-share counterparts who receive relatively lower salaries, a study by Credit Lyonnais Securities shows. In its latest half-yearly China Monitor, the broker found payments received by directors of H-share companies - mainland firms directly listed in Hong Kong - had little correlation with changes in the companies' profits. The figures were based on the companies' results for last year. Three H-share firms - Luoyang Glass Co, Zhenhai Refining & Chemical Co, and Tianjin Bohai Chemical Industry (Group) Co - stood out as their bonus payments shadowed profit performances. At Luoyang Glass, the bonus for directors averaged 173,000 yuan each. The amount was much more than that at other H-share companies, despite a 4 per cent cut to reflect a 3.4 per cent drop in earnings. Three other companies - Maanshan Iron & Steel Co, Shanghai Hai Xing Shipping Co and Tsingtao Brewery Co - saw reduced earnings last year and did not distribute bonuses. The remaining companies demonstrated no correlation between results and bonuses. Dongfang Electrical Machinery Co's earnings rose 5.5 per cent, but its directors were given a bonus increase of 182 per cent. Annual salaries of H-share company directors averaged about 25,000 yuan last year, one-eighth of that received by directors at red-chip companies. Even with bonuses included, they received an average of 51,000 yuan, far below their red-chip counterparts who got an average $881,000. Credit Lyonnais said directors of red-chip companies surveyed received smaller bonuses or none at all last year, despite the profit growth. However, they were more than compensated for by stock options. However, directors of H-share companies were not given stock options, the broker said. They were issued A shares which were subject to many limitations such as shares' sale date and illiquidi-ty. 'This further erodes the motivation of H-share executives, especially [when] compared with red-chip companies,' Credit Lyonnais said.