We were also interested to read this new study on corporate pay, from Ossiam and Proxinvest. It found that the more executives and directors are paid, the worse a company’s share price performs.
Moral Money, an FT newsletter
Relevant extracts
Board Remuneration (-2.6%): our results suggest that high board remuneration consistently
https://api.ossiam.net/front.file/Governance%20Data%20Where%20is%20the%20Alpha%20-%20EN%20-%20Final/EN
penalises equity performance. In fact, if the fee paid by the company to the member as
compensation for being on the board is significant in relation to the member’s net worth, it can
become a subconscious factor affecting their judgment.
And
CEO Total Compensation (-3.1%): companies with low CEO total compensation significantly
https://api.ossiam.net/front.file/Governance%20Data%20Where%20is%20the%20Alpha%20-%20EN%20-%20Final/EN
outperformed companies that award their CEO with large total compensation packages. This
finding could suggest that excessive compensation signals an agency problem in a weak
governance structure that could negatively affect the company’s performance.
• Senior Management Bonus Cap (-4.7%): the result suggests that a lower bonus cap
arrangement can be a highly effective tool and hence contributes significantly to equity
performance. Setting and maintaining an appropriate bonus cap for senior managers can play an
important role in controlling management’s attempts to misappropriate company resources by
paying excessive bonuses.
• Compensation Package (Base Salary (-1.6%), Annual Bonus (-2.0%), Long-Term (-2.1%) and Other
Compensation (-2.3%)): our results show that whether we consider the base salary, the bonus,
long-term or other types of compensation, companies that have a more parsimonious
compensation policy and award relatively less to their senior managers tend to perform better.
Interestingly, the biggest gap is observed for the Other Compensation pillar, which tends to be
company-specific and may eventually hide sub-standard practices in CEO compensation policies.
• Compensation relative to Total (Base Salary (+2.8%), Annual Bonus (-1.0%), Long-Term (-0.9%)
and Other Compensation (+0.6%)): a clear pattern emerges from our results: companies that pay a
more significant part of CEO total package in the form of base salary show better performance.
Meanwhile, when an annual bonus or other form of compensation represents a significant
proportion of total compensation, equity performance tends to lag. This confirms the intuition that a
high base salary proportion of the total package can serve as well-deserved compensation to
effectively motivate the CEO, while avoiding managerial short-termism linked to inherently shortterm incentives (such as a bonus), which possibly has harmful effects on the company’s long-term
growth.
Actually no need for study. Juz look at the performance of PM, Tharman, Lawrence Wong, Kee Chiu, Queen Jos and the other millionaire ministers: die die must raise GST.
Thoughts of a Cynical Investor 
They need the money as GIC’s and Temasek’s returns projected to slow down.
Anyway they’ve done the calculations and net-net the country will do better with GST increase.
Salaries of working sinkies have gone up a lot in recent years and the trajectory is intact as long they maintain control of white collar foreign workers. Witness the ongoing property boom in the face of highest inflation in 10 yrs & talk of global recession.
Trend (and national policy) of more sinkies working longer & retiring later. This will help overcome inflation & GST increases, as well as the doomsday scenario of insufficient workers supporting too many retirees.
Only a small minority of sinkies affected. Those long retired with no more human capital. And this group will get smaller as members die off.
And euthanasia will be discussed by 2030.
As addendum to my above comment, witness ordinary sinkies’ $2.4B over subscription to Aug’s Singapore Savings Bond.
And 2021’s record voluntary CPF top ups hitting $4B for the first time.
98% of an Ang Mo Kio condo launch sold out at an incredulous average $2,100 psf for that estate.
Sinkies are cash rich and getting richer.
These are real-time empirical signals to PAPies that vast majority of sinkies are able to bear any GST increases.
As their godfather, LKY, had said, sinkies are champion complainers.