SINGAPORE (May 4): ISR Capital saw its share price collapse 96% y-o-y last year while reporting an 82.8% y-o-y decline in losses to $1.4 million.
However, executive chairman Chen Tong was paid between $250,000 and $500,000.
The previous year, ISR’s highest-paid official was its executive director Quah Su Yin, who also earned between $250,000 and $500,000.
Although Chen only became involved with ISR in September 2016, should he have been paid less after such a poor year?
Chen was among four investors who put $12 million in ISR via a placement of new shares at 8.5 cents each.
Following a series of announcements that it would invest in a rare earth mining concession in Madagascar, shares in ISR were soaring at the time.
In Nov 2016, the stock hit a peak of 31 cents, putting the whole company’s value at $661 million.
However, the stock collapsed when Malaysian businessman John Soh Chee Wen was arrested in November 2016.
Soh was charged with the manipulation of shares in Blumont Group, LionGold Corp and Asiasons Capital (now called Attilan Group), the trio of stocks that soared and then collapsed spectacularly in 2013.
Prosecutors later said in open court that Soh was also involved in the manipulation of shares in ISR.
ISR's example shows that when it comes to the very best and worst performing stocks in the Singapore Exchange, the story of top executive remuneration is varied and complicated.
Performance matters but companies often have extraordinarily good years or bad years for reasons that have nothing to do with the decisions of their top executives.
And, as much as it may irk investors, companies sometimes have little choice but to pay their executives top dollar even when things are not going well.
FInd out more about the relationship between performance and pay in this week’s issue of The Edge Singapore (Issue 829, Week of May 7), available at newsstands today.
Subscribers can log in and read the story "Paying for performance"
