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TEJ [Directors & Supervisor’s Remunerations database] provides various information related to the remuneration of directors and supervisors, ranging from total remuneration and salary, numbers, remuneration to income ratio to the information of directors, supervisors, and managers’ remuneration and salaries. Up to 55 sub-blocks, users can experience the most complete and accurate Taiwan’s remuneration of directors, supervisors, and managers. This article will introduce the importance of directors’ and supervisors’ remunerations information, applications, and how to find these data.
Highlights of this article
1. The application of Directors & Supervisor’s Remunerations database
2. Directors & Supervisor’s Remunerations database user guide!
On Jan. 27, TWSE had reported information on listed companies that reported after-tax losses for 2020 but paid more in total director and supervisor remuneration or average remuneration per director or supervisor. The following is the press release:
To improve disclosure of director and supervisor remuneration for listed companies, TWSE will also publish information on listed companies that reported after-tax losses for 2020 but paid more in total director and supervisor remuneration or average remuneration per director or supervisor under the Corporate Governance section of MOPS. Intended to encourage companies to set reasonable director and supervisor remuneration through the market mechanism, the information will include company code, company name, after-tax loss for 2020, total director and supervisor remuneration, and average remuneration per director or supervisor.
The list is typically called the “Fat Cat list”. What can we gain from this list?
Fat cat refers to those executives like directors, supervisors, and managers, who have high remuneration or salary but run a company badly. That’s why it is called a “Fat Cat” list. If a corporation is on the list, there may be a problem in corporate governance.
An agency problem is a crucial issue in corporate governance. Agency problem refers to the agent and principal having different goals and interests, which lead to interest conflicts between principal and agent. In corporate governance field, it is the conflicts between managers and shareholders. Due to the separation of ownership and control, the shareholders possess little control over the management decisions. It seems that the managers and shareholders should have the same goal. However, due to the difference in their interests, the agency problem will occur.
For example, if a company had been run badly, and the stock price dropped dramatically, it would be a disaster for stockholders, but managers probably won’t suffer from the price drop. As long as the company doesn’t go bankrupt and the managers don’t get fired, managers can still get paid. From here, we can see the different interests between shareholders and managers. Furthermore, crucial decisions like the recruitment of managers are made by big shareholders since they have enough votes. The decisions may not be in the best interest of small shareholders.
We can know the relation between the directors, supervisor, manager’s remunerations and the performance of company’s operation by Directors & Supervisor’s Remunerations database. The contract of executives’ remunerations is one of the solutions to the agency problem. We can see if the remunerations correspond to the operation performance. Sometimes, the salaries don’t reflect the remunerations. Besides salaries, bonuses and allowances will be provided to managers. So, to know the exact remunerations, salaries, bonuses, and allowances should be considered to determine if the remuneration truly reflects the performance of executives.
Through the Directors & Supervisor’s Remunerations database, users can gain all the remunerations-related information. The following are the steps.
Directors & Supervisor’s Remunerations database steps
👉Click Taiwan Market DB(TEJ TAIWAN DB)➡️ TEJ Company DB➡️Directors & Supervisor’s Remunerations
Classifications of executives➡️Directors, supervisors, CEO, major managers, etc.
Classification of remunerations➡️ Compensation, severance pay, bonus, allowances, etc.
There are more than 50 sub-items for users to refer to. In addition, you can also select a stock and select a specific range through the 🗓 calendar icon in the upper right corner to complete Data creation and query.
👉Click Advance Date option➡️ Choose the range➡️Put them to the right column
If users want some specific column to make it simple, we can use the field group setting.
👉Click Field➡️ Choose the column➡️ Click Confirm
Following the steps, users can also choose the companies they want.
👉Click ID➡️ Choose the companies➡️ Click Confirm
We have introduced the importance of directors’ & supervisors’ remunerations in corporate governance and agency problems. The existence of fat cats could mean there is a serious agency problem. We can determine if there are fat cats analysis the data from Directors & Supervisor’s Remunerations database. It is a very useful tool for friends that want to research corporate governance. If you have any further queries or suggestions regarding the TEJ database, please do not hesitate to send your inquiries or ideas by phone or by email to us.
— What is a Corporate Governance Assessment? What is the impact on the company ?
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