Who is the most valuable CEO?

The Refrigeration Electrical Engineering Corporation (REE) created a ‘revolution’ of salary for its CEO Nguyen Thi Mai Thanh. All shareholders attending the REE shareholders’ meeting held in late March 2007 voted to increase Ms Thanh’s wage from VND48 million (US$3,000) per month in 2006 to VND100 million ($6,200) per month this year.

REE shareholders call this a ‘revolution’ because Ms Thanh’s wage had not changed in the previous three years (under a labour contract signed on January 1, 2004, Ms Thanh’s salary is VND48 million per month) and now it has increased by more than two times.

An official of REE commented: “It is understandable to see Ms Mai Thanh’s wage rising like this because this number must be equivalent to the annual growth of REE.”

A human resources expert said that the wages of CEOs of firms listed in the Vietnamese stock market meets the current situation on the market for senior human resources of Vietnam. However, wages are only the easy-to-see part of income of CEOs because the thing that keeps them close to listed firms is that the volume of shares they and their family members own increases each time their companies issue bonus shares and new shares to increase capital.

High bonuses calculated based on the percentage of after-tax profit of the corporations are also a way to retain senior personnel.

Ms Thanh is one of the CEOs of listed companies who began as a state employee. Other CEOs of the same kind include Ms Mai Kieu Lien, Chairman and CEO of the Vietnam Dairy Product Company (Vinamilk), Mr Le Quang Doanh, Chairman and CEO of Binh Minh Plastic Company (BMP), and Ms Pham Thi Viet Nga, Chairman and CEO of the Hau Giang Pharmaceutical Company.

The common thing of those CEOs is that after equitisation they were trusted and appointed to be the representative of the State in the equitised firms. Their fast adaptation to their new working environments has also been highly praised by investors.

The CEO of a fund management company said: “I like Ms Mai Thanh’s to-the-fullest working style. Once my fund was about to issue more fund certificates, she called me at night to ask about the upcoming form of issuance so that REE could buy. I don’t know how she could work that hard, but such is the way of a businessperson who always considers the interest of his company.”

However, many shareholders are beginning to ask if it is in fact good for listed firms to have CEOs who were previously state employees and have stayed in their positions for so long. Because, according to human resources experts, one who sits in a position for a long time will become idle and lack new ideas.
Stock investors admire the group of CEOs who they call ‘two in one’ the most. These are real owners and businessmen, who are considered the richest on the Vietnamese bourse based on the volume and the value of shares they own.

Some big names are Tran Kim Thanh and Tran Le Nguyen of the Kinh Do Group, Truong Gia Binh of the Corporation for Financing and Promoting Technology (FPT), Dang Thanh Tam of the Tan Tao Industrial Zone JS Company (ITACO), Le Van Quang of Company, and Nguyen Duy Hung of the Saigon Securities Trading JS Company (SSI). Wages are no longer important to those CEOs because they are the biggest shareholders of the companies they lead.

Dang Thanh Tam, who has just left the CEO position of ITACO to assume a new post at the HCM City Hi-tech Park, is an example of this kind of CEO. But only several people know that the biggest ability of Mr Tam is designing projects. Projects of thousands of pages are always attractive to this CEO since this man wrote the first lines for the project to establish the Tan Tao Industrial Zone in HCM City.

Mr Tam is also very good at speaking English. He can directly negotiate with foreign partners without translators. He is also an ‘anonymous lawyer’ because he widely understands both Vietnamese and international laws on economics. During his foreign business trips, Ms Tam plays the role of a CEO, a translator, and a lawyer. Thus, he can make decisions very quickly and doesn’t need time to seek outside consultancy.

However, stock investors are still waiting for a new generation of young businessmen who will blow new and strong winds into listed firms. They are professional CEOs who are trained methodically and systematically and have tempered themselves in the international environment.

Phan Bich Van, CEO of Saigon Thuong Tin Bank (Sacombank), is an example. Ms Van worked for the International Finance Company (IFC) under the World Bank and won a Fulbright scholarship to study for a Master’s of Business Administration in the US before working for Sacombank.

As the representative for Sacombank at international workshops, Ms Van has won the hearts of participants with her charm, self-confidence, which have contributed to creating the image of young, talented and professional CEOs of Vietnam in the eyes of international investors.

According to investors, two CEOs considered the most ‘expensive’ in the Vietnamese stock market based on their annual income and success in business affairs are Don Lam, CEO of VinaCapital, and Dominic Scriven, CEO of Dragon Capital.

Don Lam graduated from Toronto University in Canada, majoring in trade and politics, in 1990. He was previously Deputy General Director of PricewaterhouseCoopers Vietnam, in charge of corporate finance consulting and management consulting and Manager in charge of corporate of the Deustche Bank Vietnam.

Dominic Scriven graduated with honours in law and social studies from Exeter University, the UK. He has 15 years of experience in the field of investment, including 13 years in Asia, particularly in Hong Kong and Vietnam. He worked for M&G Investment Management, Sun Hung Kai & Co and Citicorp Investment Bank.