Incomes of SOE managers increase on reform

Wang Zuji, president of China Construction Bank, attends the interim results press conference in Hong Kong, China,?Aug 31. 2015. [Photo/IC]

Average salaries for the managers of State-owned enterprises increased in more than a year since reform of the salary system, although their numbers have fallen.

Announced in November 2014, the plan, which took effect on Jan 1 last year, covering 72 key SOEs, would result in an overall decline in the number of bosses at State firms, said Qiu Xiaoping, vice-minister of human resources and social security shortly after the plan's implementation.

However, according to the annual fiscal reports of 48 listed SOEs which are included in the plan, their average annual income in 2015 rose to 1.07 million yuan ($165,200) from the 970,000 yuan a year ago.

Four companies saw their managers' salaries more than double last year. Shanghai Zhenhua Heavy Industry Co Ltd provided the highest increase. Its current president, Huang Qingfeng, received a total income of 894,000 yuan last year, while his predecessor Lu Jianzhong only made 205,300 yuan in 2014. Zhenhua's net profit increased 5.04 percent year-on-year to reach 212 million yuan in 2015.

Mai Boliang, president of China International Marine Containers (Group) Ltd, received the highest annual income of over 6.37 million yuan last year among all the 48 managers. But this number dropped significantly compared to his 2012 annual income of 9.98 million yuan.

The central government's intention to bring down the salaries of SOE managers is not only verified by Mai's declining salary but also in another 18 public companies. The most significant decrease was noticed at Guodian Nanjing Automation Co Ltd. Its general manager Ying Guangwei's annual income last year was only 164,000 yuan, slumped 68.34 percent compared to his predecessor's income one year earlier.

Even though the five State-owned commercial banks grew steadily and made a total net profit of over 920 billion yuan altogether in 2015, their presidents' income was all nearly cut in half. Wang Zuji, president of China Construction Bank, saw the biggest decline of 67.79 percent among all five bank presidents.

The recent continuous fall in crude oil prices has resulted in contracting incomes at the two giants－Sinopec Group and China National Petroleum Corporation last year, with their net profit declining 11.4 percent and 70 percent respectively. As a result the presidents of these two companies saw their annual income drop around 40 percent in 2015.

Of all the 48 managers, Gao Guichao, general manager of Yunnan Copper Co Ltd, only received 60,000 yuan last year, which is even less than the annual income of a courier. But the company later clarified that it was only the basic income of Gao while his bonus has not been included.