The directors and shareholders of publicly held SGX are kept informed about every detail of Hsieh’s and other senior staffers’ pay and perks -- and the figures are open to review on the company’s Web site (www.sgx.com).
Hsieh has a very respectable total compensation package (including salary, bonuses, benefits and other perks) of just under $1 million a year. If SGX shares outperform, the board can grant him options to add to his take. But unlike ousted Big Board chairman Dick Grasso, Hsieh has neither an eye-popping deferred compensation deal nor a seat on the board of any company listed on his exchange.
Still, in fairness to Grasso, SGX has a near monopoly on local listings, so Hsieh needn’t worry much about gaining market share at home. And although the SGX has a regulatory function, its domain encompasses the trading activities of just 540 listed companies -- hardly the NYSE’s 2,800.
As an SGX-listed company itself, the Singapore Exchange has a reputation for ruthlessly squeezing captive local brokerages for revenues to operate the exchange and generate profits for its shareholders. Companies complain that fees for clearing, trading terminals, listings and deposits all keep rising. Hsieh is trying to deal with their gripes. “We are not going to make a lot of money if our customers aren’t happy,” he says.
Nevertheless, Hsieh isn’t forsaking his real bosses -- the SGX’s shareholders. He has cut costs by trimming staff and closing a U.S. office. Last quarter the SGX delivered a $174 million special dividend. And Hsieh is eager to form alliances so that Singaporeans can buy the top stocks of other exchanges at the SGX.
Hsieh, who was once CEO of Morgan Grenfell’s Singapore operations and later founded a private equity firm, sees his job as a form of “national service.” But after his three-year term expires in March 2006, he intends to go back to his private equity partnership -- where the pay may be better but he won’t enjoy a monopoly.
