The Chinese government is warning its state owned financial companies to cool executive pay in the wake of a report that some top financial execs were earning an outrageous $1.4 million a year.
See, when your financials are actually state owned properties, not properties propped up by the state you can tell them to cut back on too-large pay.
China View: State-owned enterprises (SOEs) and state-held companies in the financial sector should keep management salaries at a “reasonable” level, the Ministry of Finance said in a notice released Monday.
The notice said the goal was to avoid huge gaps between such salaries and those of lower-level employees in such organisations, as well as the general public.
The MOF notice also urged those organisations to suspend stock option incentives and employee stock ownership plans during the global financial crisis. The plans will be suspended until the government releases specific policies regulating such activity, said the MOF.
Most foreign financial companies have reined in management compensation in response to the crisis, and some domestic financial SOEs have already done the same for 2009, said the MOF.
The MOF also asked the companies to monitor the business expenses of senior management.