CHEAP CHINESE LABOR

Another billionaire tech CEO—this time from China—has opted to make less than $1 per year

Obsession
China's Transition
Obsession
China's Transition

Business executives who earn $1 salaries can now welcome a new member to their club: Liu Qiangdong, CEO of JD.com, China’s second-largest e-commerce site.

In its earnings release on Friday, the company announced that Liu would begin receiving an annual salary of one Chinese yuan (about $0.16) over a 10-year period. In lieu of regular yearly payments, the CEO will receive an option to acquire 26 million class A shares of JD (0.9% of outstanding shares) at the option exercise price of $33.40 per ADS over a decade-long schedule. Shares of JD are currently trading at $32.07.

Liu’s salary cut comes as the company embarks on a new phase in its growth. The company brought in second-quarter revenue of 45.9 billion yuan ($7.4 billion), beating estimates and showing annual growth of 61 percent. But that growth is expected to slow, and the company continues to operate at a loss. It’s been investing aggressively in same-day delivery for groceries and other services, chasing a trend that’s forming across both China and the United States.

The global $1 salary club consists primarily of American CEOs. Notable members include Mark Zuckerberg, Steve Jobs, Google’s top three executives, and Elon Musk—though he recently joined the $0 salary club.

But Liu is not the first CEO from China to forgo a normal salary. In 2009 Liang Wengen, founder of heavy machine manufacturer Sany Group, reduced his salary (link in Chinese) for that year to one Chinese yuan in the wake of the global financial crisis. His net worth is currently valued at $5.2 billion, according to Forbes.

Lenovo’s Yang Yuanqing is the highest-paid CEO of any Chinese company listed in the mainland or in Hong Kong, according to Forbes. The hardware maker collects an annual salary of $1.9 million.

Liu’s net worth sits at $8.7 billion, according to Forbes. That places him slightly behind Xiaomi’s Lei Jun ($9.1 billion), Baidu’s Robin Li ($14.7 billion), and Alibaba’s Jack Ma ($22 billion). None of these men are likely to go hungry anytime soon.

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