Corporate salaries – part 1

Two readers – Samdrups and Sharu – asked me for my views on our government’s recent announcement on corporate salaries. My views are simple. And they are straightforward. Government should not be involved in doing business. Yes, government should regulate businesses. But no, government should not interfere in how businesses are run. So our government’s decision to define the salaries of corporations – business entities, all of them – is wrong.

First, consider the Druk Holdings and Investment Limited. DHI was established by His Majesty the King as an autonomous organization in order to promote “…the competitiveness of Bhutan’s economy by transforming companies with government shareholding into highly efficient and productive companies that strive for excellence.” If DHI is to strive for efficiency, productivity and excellence, it goes without saying that they should have full authority over their HR policies. And that includes the salaries of their employees. The government cannot dictate salaries to DHI and expect them to become highly efficient or productive enterprises.

That’s why the Royal Charter of DHI (which outlines how DHI will function and which, incidentally, was revised to incorporate the submissions made by the government to His Majesty the King) clearly states that “the remuneration of the CEO and the employees of DHI shall be determined by the Board of Directors of DHI.” The DHI’s Board of Directors must do their job. Two of the seven-member Board of Directors are civil servants, purposely, to ensure that the government’s views are adequately represented in the organization. Any attempt by the government to encroach on the Board’s authority is illegal. And must be challenged.


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  1. I googled DHI and it is indeed a very interesting concept by HM-the King. We are all actually very fortunate that this was initiated so that the wealth of the citizens of Bhutan is secured and protected. How wonderful. This will ensure sontinuous free health care and free education to our children beside many other bebefits we avail as citizens of Bhutan. That way, we are all truly & totally blessed with such visionary King that will always guide & shelter us from the whims of ugly politics.

    To comment a bit in the corporate salary structure – YES, business should be left in the hands of the Business people but govt. should certainly time to time regulate in the positive manner. The salary structure should be completely left in the hands of the corporate companies themselves as they will be the best to judge the remuneration of their employees according to the needs of performance in specific jobs. After all the businesses will not be too exhorbitant also since they have to make a profit too and mind you the business owners will not be generous at all as bussinesses are profit oriented. So, I don’t see any reason whay the government should interfere. BUT on the flip side I read in teh papers that the goverment has only laid the guidelines which is a good thing since Businesses can base thier judgment on these guidelines and fix pay structures. A guideline is a guideline and it is usually not a hard & fast rule to follow that unless the word “guideline” bears a different meaning. The finance owned corporate offices pay structure guideline should be that of the DHI corporate pay structure and not something that the government issues.

  2. MoF and the government in madness did the job of corporate salary revision. One by proposing and other by approving leaving more than 10,000 unhappy. DPT forgot its slogan vividly printed on the DTP Cap during the election about Gross national Happiness. This is dodgy!

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