Singapore’s DBS group has slashed fiscal 2022 compensation for CEO Piyush Gupta by nearly 30% to the tune of $3 million (Rs 256 crore) citing responsibility for multiple digital banking outages last year despite the lender registering record profits. The rare top-level accountability stance for customer inconvenience drew market plaudits.
DBS bank stated other group management executives also took pay cuts up to 21% aimed upholding reliability standards after incidents like a 10-hour online banking failure that drew central bank censure regarding lax governance.
Boosts Leadership Responsibility Perceptions
According to analysts, the board’s tough stance strips typical corporate insulation shielding highly-paid CEOs from financial implications of business errors. By overriding great financial results with higher customer centric accountability, DBS has set wider industry precedents uplifting leadership responsibility perceptions.
This contrasts most sectors including tech and banking who continue handsome executive rewards amidst large-scale staff layoffs triggered by funding woes or macro uncertainty – rarely self-imposed. But DBS intends leading by example on equitable accountability.
Criticism Mounts Globally on Sky-high CEO Salaries
Experts note that with median employee salaries often stagnating around inflation, disproportionate top-tier pay hike continue drawing scrutiny especially when coupled with broad-based job cuts revealing the income inequality chasm at workplace.
Recent research also discovered that workers put in extra efforts when leadership visibly sacrifices personal payouts demonstrating concern for staff welfare beyond profit motives. However structural skews around stock grants mean CEO salary cuts rarely impact cumulative compensation but offer moral symbolism.
As economic conditions remain challenging, a culture of shared struggle requires emanating from the top.
