Nissan Proposes Higher Executive Compensation Amid Board Expansion
Nissan Motor Co. is set to raise its combined executive compensation ceiling from 2 billion yen to 2.6 billion yen at its upcoming shareholders meeting, a move aimed at accommodating the planned expansion of its board. This increase would lift the current compensation limit, already one of the highest in Japan, and follows President Carlos Ghosn's belief in a globally competitive pay system to retain talented executives. In contrast, Honda Motor Co. intends to lower its executive compensation cap due to its planned decrease in board members and changes to its bonus structure.
Key Takeaways:
- Nissan's proposed increase in executive compensation ceiling to 2.6 billion yen is intended to accommodate the expansion of its board from seven to nine members.
- The company's current compensation limit of 2 billion yen is already one of the highest in Japan, paying nearly 300 million yen in compensation to each director.
- Nissan provides generous bonuses and stock options, with President Carlos Ghosn believing a globally competitive pay system is essential for retaining talented executives.
- Honda Motor Co. intends to lower its executive compensation cap from 77 million yen to 60 million yen due to the planned decrease in board members and changes to its bonus structure.
- Honda director bonuses will total 668 million yen this fiscal year, roughly matching the company's combined executive compensation.
- The ratio of bonuses to compensation at Honda was 40-60 last fiscal year.
Statistics:
- Nissan's proposed executive compensation ceiling increase: 2 billion yen to 2.6 billion yen
- Current executive compensation ceiling at Honda Motor Co.: 77 million yen
- Proposed executive compensation cap reduction at Honda Motor Co.: 77 million yen to 60 million yen
- Director bonuses at Honda Motor Co. this fiscal year: 668 million yen
- Ratio of bonuses to compensation at Honda Motor Co. last fiscal year: 40-60
Sources:
- [Nikkei, June 8, 2023]