2011/2012 Asia Executive Remuneration Snapshot Survey

The economic fortunes of the region are still linked to the West, and the government debt worries within the Eurozone have been a constant cloud on the horizon. They have dented the growth prospects of major economies including China, Japan and Singapore.While a healthy 60% of companies expect profits to rise in 2011, this figure stood at 72% when companies were last surveyed , highlighting the growing pessimism across the region.

Understandably, Japan is the most pessimistic. A total of 37% of companies expect a decrease in profits for 2011 compared to 22% in 2010. This is the highest figure within Asia Pacific, for a country which has stagnated for many years, seen pressure on its exports and suffered a catastrophic earthquake in 2011. But the tiger economies of Vietnam and the Philippines stand alone as the only two countries surveyed that have seen an increase in the number of companies expecting a rise in profits for 2011.

The note of caution across the region is evident in the results for companies discussing pay increases for their organization heads. All the 12 countries and markets surveyed expect to give lower pay increases for 2012 than they have given this year.

Asian companies are providing more aggressive incentive payments — both short-term incentives (STIs) and long-term incentives (LTIs) — than Western companies based in the region. For example, STIs make up 34% of the average Asian company head's remuneration package compared to 25% for a Western company.