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Shinsegae Group Chairman Chung Yong-jin. (Photo=Shinsegae Group) |
[Alpha Biz= Reporter Kim Jisun] Shinsegae Group is restructuring its executive compensation system by reducing the base salary portion and increasing the performance-based pay.
Shinsegae Chairman Jung Yong-jin emphasized last November that all personnel decisions and compensation should be strictly based on performance, advocating for the establishment of objective and clear KPIs (Key Performance Indicators).
According to industry sources on the 9th, Shinsegae Group has recently revamped its executive compensation system.
There are plans to increase the proportion of performance-based pay in executive salaries from the current 20% to nearly half. The rationale behind this decision is that a lower proportion of performance-based pay can hinder executives from taking risks and driving new initiatives.
Shinsegae Group's internal survey revealed that while major domestic corporations allocate 50-60% of executive compensation to performance-based pay, Shinsegae Group currently allocates around 20%.
The new compensation system will be applied to newly appointed e-commerce executives, including those at Gmarket and SSG.com, starting from last month.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
