Credit Suisse execs take bonus cuts of 40% after outcry

Updated 14 April 2017
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Credit Suisse execs take bonus cuts of 40% after outcry

GENEVA: Credit Suisse’s chief and other top executives offered Friday to have their bonuses slashed by 40 percent, following investors’ concern over the size of their proposed compensation packages.
Credit Suisse chief Tidjane Thiam and the bank’s executive board proposed that the “long-term incentive awards for 2017 and short-term incentive awards for 2016 ... be reduced by 40 percent each,” according to a statement.
The board of directors would also leave its compensation unchanged at the same level as 2015 and 2016, and would not accept a proposed incremental increase, it added.
“My highest priority is to see through the turnaround of Credit Suisse which is under way,” Thiam said in a letter to shareholders published Friday.
“I hope this decision will alleviate some of the concerns expressed by some shareholders and will allow the executive team to continue to focus on the task at hand,” he added.
The move came after Credit Suisse’s compensation committee last month proposed handing Thiam and the bank’s 12 other executive directors 26 million Swiss francs ($26 million) in short-term bonuses for 2016 and up to 52 million francs in long-term bonuses.
Ahead of its annual meeting on April 28, Switzerland’s second-largest bank has also asked investors to give Thiam nearly 12 million francs in total for his first full year on the job in 2016, after short- and long-term bonuses were added to his 3.7-million-franc salary.
The compensation committee had also proposed boosting compensation to the board of directors to 12.5 million francs this year.
Several investor advisory groups have voiced outrage over the proposed bonuses, pointing to the bank’s $2.7-billion net loss in 2016 following a massive $5.28-billion settlement with US authorities over its role in the sub-prime crisis.
Ethos, which advises major Swiss pension funds and other tax-exempt institutions, described the proposed bonuses as “excessive,” insisting that Credit Suisse’s “executive management should not have received a bonus in 2016 given the disappointing results of the bank.”
Amid market turbulence and legal woes, the bank’s stock price plunged more than 30 percent last year.
And as it dramatically reorganized its operations, it slashed 7,250 jobs over the course of 2016, with nearly the same number of jobs expected to go this year.
In a separate letter to shareholders Friday, Urs Rohner, chairman of the Credit Suisse board, stressed the board’s “high degree of satisfaction with the performance of the CEO and the Executive Board in 2016.”
But he added: “In light of the current environment and sentiment toward compensation, the board of directors understands the decision made by the CEO and the executive team ... (and) accepts these voluntary and personal decisions with great respect.”


‘Don’t be too optimistic’: Huawei employees fret at US ban

Updated 26 May 2019
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‘Don’t be too optimistic’: Huawei employees fret at US ban

  • This week Google, whose Android operating system powers most of the world’s smartphones, said it would cut ties with Huawei
  • Another critical partner, ARM Holdings, said it was complying with the US restrictions

BEIJING: While Huawei’s founder brushes aside a US ban against his company, the telecom giant’s employees have been less sanguine, confessing fears for their future in online chat rooms.
Huawei CEO Ren Zhengfei declared this week the company has a hoard of microchips and the ability to make its own in order to withstand a potentially crippling US ban on using American components and software in its products.
“If you really want to know what’s going on with us, you can visit our Xinsheng Community,” Ren told Chinese media, alluding to Huawei’s internal forum partially open to viewers outside the company.
But a peek into Xinsheng shows his words have not reassured everyone within the Shenzhen-based company.
“During difficult times, what should we do as individuals?” posted an employee under the handle Xiao Feng on Thursday.
“At home reduce your debts and maintain enough cash,” Xiao Feng wrote.
“Make a plan for your financial assets and don’t be overly optimistic about your remuneration and income.”
This week Google, whose Android operating system powers most of the world’s smartphones, said it would cut ties with Huawei as a result of the ban.
Another critical partner, ARM Holdings — a British designer of semiconductors owned by Japanese group Softbank — said it was complying with the US restrictions.
“On its own Huawei can’t resolve this problem, we need to seek support from government policy,” one unnamed employee wrote last week, in a post that received dozens of likes and replies.
The employee outlined a plan for China to block off its smartphone market from all American components much in the same way Beijing fostered its Internet tech giants behind a “Great Firewall” that keeps out Google, Facebook, Twitter and dozens of other foreign companies.
“Our domestic market is big enough, we can use this opportunity to build up domestic suppliers and our ecosystem,” the employee wrote.
For his part, Ren advocated the opposite response in his interview with Chinese media.
“We should not promote populism; populism is detrimental to the country,” he said, noting that his family uses Apple products.
Other employees strategized ways to circumvent the US ban.
One advocated turning to Alibaba’s e-commerce platform Taobao to buy the needed components. Another dangled the prospect of setting up dozens of new companies to make purchases from US suppliers.
Many denounced the US and proposed China ban McDonald’s, Coca-Cola and all-American movies and TV shows.
“First time posting under my real name: we must do our jobs well, advance and retreat with our company,” said an employee named Xu Jin.
The tech ban caps months of US effort to isolate Huawei, whose equipment Washington fears could be used as a Trojan horse by Chinese intelligence services.
Still, last week Trump indicated he was willing to include a fix for Huawei in a trade deal that the two economic giants have struggled to seal and US officials issued a 90-day reprieve on the ban.
In Xinsheng, an employee with the handle Youxin lamented: “I want to advance and retreat alongside the company, but then my boss told me to pack up and go,” followed by two sad-face emoticons.