China promises to rein in executive pay
BEIJING (AP) — China’s president has promised to rein in “unreasonably high” pay for executives at state companies in an apparent effort to mollify public frustration at the wealth of government-owned industry.
President Xi Jinping’s announcement, carried by the official Xinhua News Agency, comes as the ruling Communist Party is pressing government officials to cut spending on limousines, banquets and other trappings of office.
The wealth and privileges of state companies in industries including oil, banking and telecommunications that benefit from monopolies, low-cost credit and other support have fueled public frustration.
Pay for executives, who are appointed by the ruling party, can be hundreds of times that of the average Chinese. Chief executives of banks and other companies are paid about 2 million yuan ($300,000) per year.
Xi’s announcement gave no details of changes but said companies must make sure their pay scales are “proper.”
“Unreasonably high and excessive incomes must be regulated,” the president said at a Cabinet meeting on Monday, according to Xinhua.
After the global financial crisis hit in 2008, executives of banks and other state-owned financial companies were ordered the following year to cut their pay to 90 percent of 2007 levels to promote “income fairness.”