Sony Corp. Chairman Howard Stringer was paid 410 million yen ($4.5 million) in salary last year as the maker of Bravia televisions and PlayStation 3 consoles posted the first back-to-back annual loss since its listing.
Stringer received base pay of 310 million yen and a 100 million yen bonus for the year ended March 31, board director Sakie Fukushima told the annual shareholders’ meeting in Tokyo today. He also received stock options that may be worth about 400 million yen, the company said.
Chief executive officers at Japanese companies from Sony to Nissan Motor Co. are facing public scrutiny over salaries for the first time as regulators force their employers to disclose compensation packages starting this year. While Stringer’s pay falls short of Volkswagen AG’s Martin Winterkorn, it exceeds the income earned by the heads of Japanese companies such as Hoya Corp. and Western companies such Microsoft Corp.
“If he were Japanese, he wouldn’t be making this much,” said Mitsushige Akino, who oversees the equivalent of $450 million at Tokyo-based Ichiyoshi Investment Co. “We should probably look at this as an example of what the future holds but the Japanese perspective is to say, ‘it doesn’t make sense to get paid this much while your company is losing money.”
Since Stringer became chief executive officer, the stock has fallen 34 percent, lagging behind the Nikkei 225 Stock Average’s 13 percent drop. Sony shares rose 79 percent in the year ended March 31, double the benchmark index’s gain.
Shinsei Bank Ltd. Chief Financial Officer Rahul Gupta may resign after former Financial Services Minister Shizuka Kamei said some non-Japanese executives at Shinsei were paid “exorbitant” salaries of more than 100 million yen, a person with direct knowledge of the matter said this week.
Stringer has the highest compensation among executives at Japanese companies, based on public disclosures compiled so far by Bloomberg. In addition to the salary, he’ll be entitled to purchase as many as 500,000 shares at 2,595 yen apiece until Dec. 8, 2019, the Tokyo-based company said in a statement today.
Excluding stock options, Stringer’s compensation is lower than News Corp. Chief Executive Officer Rupert Murdoch’s $8.1 million and in line with that of Exxon Mobil Corp. CEO Rex Tillerson’s, according to data compiled by Bloomberg. It’s higher than the $1.28 million Microsoft CEO Steve Ballmer received, according to data compiled by Bloomberg.
Sony Vice Chairman Ryoji Chubachi and outgoing Chief Financial Officer Nobuyuki Oneda were paid 150 million yen and 140 million yen respectively, excluding stock options, Fukushima said.
Return to Profit
The electronics maker, which has eliminated about 20,000 jobs and shut 11 factories, is forecasting to post profit of 50 billion yen in the year ending March 2011 after posting its first consecutive annual loss since listing its stock more than half a century ago.
Sony’s restructuring efforts “have yielded tangible results,” Stringer 68, said at the company’s annual shareholders’ meeting today in Tokyo, where the company is based. The Welsh-born executive is shifting his attention to new products and services after reducing costs.
“If a Japanese executive were at the helm I doubt the company would be reforming as fast as it has,” said Ichiyoshi’s Akino. “There are signs of change and I think Stringer deserves the credit.”
Sony will focus on 3-D products and on services that link devices including televisions to the Internet and other media this business year, Stringer said.
Sony “is competitive in TV and will be more so” with 3-D Bravia and Internet-connected models, he said.