PCCW board gets massive 2000 payday


Led by Richard Li, PCCW's 2000 board package was an increase of more than 5,000% from the previous year.

HONG KONG, China (CNN) -- Loss-making telecom PCCW showered its board with a bonanza payday of HK$768 million ($98 million) in 2000.

The pay, in the form of stock options, salaries and other benefits, represented 38.5 percent of the total payments by all 33 companies listed on the Hong Kong's Hang Seng stock index, according to a report in the South China Morning Post on Friday.

The former Internet high-flyer reported a HK$6.9 billion ($885 million) net loss for the year ending December 2000, and reported the worst returns for shareholders of any Hang Seng listed firm.

Big bucks board bonanza

PCCW -- full name Pacific Century CyberWorks -- was also the only company on the Hang Seng index to post a loss for the year 2000.

Despite that, the Internet and telecom firm paid its directors more than three times the next highest-paying company.

Headed by 35-year-old tycoon Richard Li, PCCW's 2000 board package represented an increase of more than 5,000 percent from that of the previous year.

The telecom firm was followed by Hutchison Whampoa, which paid its directors $253 million ($32 million). The conglomerate is controlled by Li's father, Li Ka-shing.

Highest paid director in Hong Kong history

In 1999, Hutchison group managing director Canning Fok received more than HK$206 million ($26.4 million), earning the title of highest-paid director in Hong Kong corporate history.

But that merit was short-lived when one PCCW director received HK$283 million ($36.3 million) in 2000.

That was "almost certainly" PCCW's deputy chairman Francis Yuen Tin-fan, the SCMP states.

Another director was rewarded that year with more than HK$261 million, with a third bagging more than HK$140 million.

PCCW doesn't match names to paychecks, though it is forced to reveal the amounts by stock-exchange rules.

In all, HK$597 million of PCCW's HK$768 million payout was deemed profit from the exercise of share options.

PCCW paid its directors 8-1/2 times the amount received by the board of bank HSBC, the biggest company listed in Hong Kong.

Their pay was 68 times the amount that the board of China Mobile got. China Mobile, the biggest mainland China cell phone company, had 2000 sales of HK$43 billion, compared with HK$7.3 billion for PCCW.

Rewards amidst layoffs

The firm's stock price reached a high of HK$26.35 in February 2000 before its takeover of Hong Kong Telecom.

PCCW ended 2000 with its share price having slipped more than 70 percent.

The company has been criticized for rewarding its directors while laying off its staff.

PCCW last month slashed 506 jobs, affecting staff across the company.

It said the cuts were part of a vast cost-cutting effort that will freeze wages and new hiring for 2002.

In July, PCCW cut 340 jobs in its Internet operations as part of a general revamp of its Internet services strategy.

Shares in PCCW gained 4.6 percent on Thursday to HK$2.275 after announcing plans to dramatically recast its struggling "NOW" Internet and TV service.