Pay for Toyota's top execs averages $320,000 each

[MikeNearMcChord]

TOKYO - Toyota Motor Corp. paid its 26 top executives, including President Katsuaki Watanabe, a combined $8.27 million - an average of about $320,000 each - last fiscal year, little changed from a year earlier.

Toyota posted a fourth consecutive year of record earnings in 2005 as U.S. demand boosted sales. The carmaker's market value has surged 45 percent to $188 billion since Watanabe took charge in June 2005.
advertisement


"Toyota management has made the automaker a very open company," said Norihito Kanai, an analyst at Meiji Dresdner Asset Management Co., which manages $2.5 billion in equities. "It seems like they deserve a lot more for what they have achieved under global standards."

GM, the world's largest automaker, cut Chief Executive Rick Wagoner's pay for 2005 by 46 percent to $5.48 million. Wagoner didn't get a bonus because the Detroit-based company lost $10.6 billion for the year.

Toyota's board adopted a resolution in April to stop paying bonuses to retiring executives as of the shareholders meeting scheduled on June 23.
http://www.azcentral.com/arizonarepublic/business/articles/0609toyotapay0609.html

[Kutjara]

1. Japan has long had the narrowest wage gap

of any developed nation. The chief executives of major Japanese companies make an average of about 10x the salary of the lowest paid workers, compared to more than 100x in the US.

[theoldman]

4. So if you get paid 10X for being 100X's as good then something

is wrong in how we pay our CEO's. Actually I know the answer to our problem. All executives in a company belong to a click and they support each other. The little people have no power because most stock holders do not hold enough shares to have a strong vote. Thats the way it was 100 years ago.

[Kutjara]

6. In most large Western companies

The majority of stock is held by large pension funds and investment companies. They call the shots and appoint senior board members from within a relatively small business and social elite. Individual shareholders have precisely no power since, in most cases, they hold a minority of shares.

In Japan, corporate ownership is much more difficult to pin down, due to the interrelated webs of cross-ownership known as Zaibatsus. Manufacturers, financiers, services companies, energy companies all hold seats on eachothers boards and vote for the collective good of the conglomerate. Private shareholders don't even have the illusion of control.

Nevertheless, the Japanese tradition of conformity creates a natural bar to excessive salaries. The old Japanese proverb 'the nail that sticks up gets hammered down' applies as much in the boardroom as on the factory floor. This isn't to say that senior Japanese executives don't benefit from many other 'fringe benefits' that never show up on their tax returns. Its just another manifestation of the public vs private face of Japanese life. In Japan, the surface is never the whole story.

Also, I'm not sure that any senior executive is necessarily 100x as good as any given factory worker. Merely because someone works on a higher rung of a heirarchy, its not really an indication of ability (as many of us know only too well). A 10x pay differential for the CEO of a successful company seems to me far more reasonable than a 100x or 1000x differential for the CEO of a company that's losing billions.

[Kolesar]

7. Top execs are paid to manage large-scale risks

in addition to handling large amounts of responsibility.

Good points, Kutjara :thumbsup:

[Karmakaze]

8. I believe the poster meant...

That the japanese execs are 100x better than the US execs, not the Japanese workers. Perhaps badly worded though.

[Kutjara]

9. Ah, thanks, I misunderstood that bit. n/t

[robinlynne]

2. right on.

[flyingfysh]

3. In spite of that (or because of it?), they make the best cars

I got a new Prius yesterday, and I'm still amazed by all the stuff I am finding out about it. I was getting better than 50mpg just driving home. It makes every other car on the street look old-fashioned. I'm still finding major gadgets in the engine compartment I never heard of before.

I got mine while the $3150 tax credit still applies; the credit gets reduced later this year.

[tanyev]

5. Now that's responsible leadership.

If American companies had done that all along, maybe they wouldn't be in the mess that they're in.

[madrchsod]

10. i assemble parts for toyota

they are dam tough..they have standards far better than any other car company we assemble parts for. that`s why they are really-really good cars