Nintendo President Takes 67 Percent Pay Cut After Company's First Loss
His salary was reduced by more than $1 million in a sign of atonement for the video gaming company's loss after sales of consoles fell last year.
TOKYO – Nintendo president Satoru Iwata took a 67 percent pay cut in fiscal 2011 as his salary was reduced to 45 million yen ($566,000). It was a signal that he took responsibility for the company’s first-ever full-year loss since it went public.
Nintendo lost 43.2 billion yen ($533 million) in the year that ended March 31 on weaker sales of its Wii and portable 3DS consoles.
Iwata revealed the drop in his remuneration at the annual shareholders’ meeting in Kyoto, where the game maker is headquartered. His pay in 2010 totaled 137 million yen ($1.7 million). CEO salaries in Japan are almost universally lower than those for the bosses of comparable corporations in the U.S. and Europe.
Pay cuts and foregoing bonuses are a traditional way of atoning for poor performance or corporate misdemeanors in Japan. For example, the CEO of Nomura Holdings, Japan’s largest brokerage, announced at the end of the week that he would take a six-months 50 percent pay reduction to take responsibility for a recent insider trading scandal.
Sir Howard Stringer and six other Sony executives also recently gave up their bonuses for last year in the light of record losses at the conglomerate.
Nintendo’s new larger-screen 3DS console will bow in Japan and Europe on July 28 and in August launch in the U.S. The 3D portable has sold about 17 million units globally since its launch in February of last year, well below expectations.