Hong Kong’s biggest corporate chieftains are better off than shareholders as median executive pay outstrips stock performance
- Hong Kong chief executives have enjoyed significant gains from 2014 to 2018, with remuneration rising 117 per cent, outpacing the 28 per cent gain in stock prices in the same companies over the period
- Tencent’s President Martin Lau is the highest-paid among the CEOs of Hong Kong-listed companies, getting 313.47 million yuan in 2018
Corporate chieftains in Hong Kong, the world’s most expensive city to live and work in, are far better off than their shareholders, as their remuneration packages have ballooned at a faster rate than their companies’ share performances in the past five years, according to a study.
The median CEO’s pay package soared 117 per cent between 2014 and 2018 for 142 companies with at least HK$25 billion (US$3.2 billion) each in market capitalisation, according to Comptify Analytics, a research firm that analyses human resources data. The stock prices of these companies rose by just 28 per cent on average over the period.
The outsize reward packages, comprising basic pay, bonuses, stock options and incentive plans, underscore the top dollar that companies have to pay to retain their top talent.
“The pay for Hong Kong CEOs [are] still lower than the top-tier companies listed in New York or London because the companies are usually more internationalised and therefore are bigger, which is correlated to pay level,” said Comptify’s managing consultant Vincent Fung, adding that pay levels “accelerate exponentially” with market value.
The median remuneration of Hong Kong’s mega corporations was HK$15.5 million per year, while mid-cap companies – those valued at between HK$2.5 billion and HK$10 billion – took home HK$6 million, and small-cap CEOs were paid HK$3.8 million, Comptify said.