China tech giant JD.com is to slash the salaries of thousands of its top executives as it attempts to fall into line with Beijing’s ‘common prosperity’ drive.
The firm said the move would affect more than 2,000 senior managers who would see their salaries reduce by 10% to 20% next year to help pay for improved benefits for other staff, amid the Chinese government’s push to reduce income inequality.
JD.com CEO Liu Qiangdong also plans to personally donate 100 million yuan to a fund that help children of JD employees should anything happen to their parents, said the letter, which was circulated online and later confirmed by JD.com as authentic.
“The employee benefits plan is currently being improved, with a focus on front-line staff,” a JD representative said. The company has 540,000 employees.
Alibaba Group and Tencent Holdings last year pledged to spend billions to support the effort, while state-owned investment banks have implemented pay cuts and delayed bonus payments this year.
JD has been hit by a slowing economy and flagging consumer spending this year, though it last week posted an 11.4% rise in third-quarter revenue and said it was seeing signs of a demand recovery as China adjusted it zero-Covid policy.
- Reuters with additional editing by Sean O’Meara