Monex Group has rewritten its executive pay rules, shifting a bigger share of compensation into performance-linked awards and publishing a target mix that would leave its chief executive on 40% base pay, 25% short-term incentive and 35% long-term incentive. For executive officers, the standard mix is 50% base pay, 25% short-term incentive and 25% long-term incentive. The company said the overhaul was approved by its compensation committee on June 27 and is meant to strengthen pay-for-performance and value sharing with shareholders and investors.
| Feature | Applies to | Disclosed design |
|---|---|---|
| Short-term incentive | Directors who also serve as executive officers, and executive officers | Cash award linked 60% to company-performance indicators such as net operating revenue and profit for the year, and 40% to mission evaluation; payout range 0% to 200% |
| Long-term incentive | Same executive roles | Stock award split 50% KPI-linked and 50% non-KPI-linked; the 0% to 200% evaluation coefficient applies to the KPI-linked half, using indicators such as ROE and relative TSR |
| Standard CEO mix | Chief executive | 40% base pay, 25% short-term incentive, 35% long-term incentive |
| Standard executive mix | Executive officers | 50% base pay, 25% short-term incentive, 25% long-term incentive |
| Non-executive director pay | Directors who do not also serve as executive officers | Base pay plus stock compensation only, with the stock element non-KPI-linked |
The short-term incentive will be a cash award, with 60% of the score based on company-performance indicators such as net operating revenue and profit for the year, and 40% based on a mission evaluation tied to important annual objectives. That award can vary from 0% to 200% depending on achievement against those measures.
Long-term incentive pay for directors who also serve as executive officers, and for executive officers, will be stock-based. Half is KPI-linked stock compensation, using indicators such as return on equity and relative TSR, and half is non-KPI-linked stock compensation tied to tenure. The 0% to 200% evaluation coefficient disclosed in the policy applies to the KPI-linked half, not to the whole long-term award. Directors who do not also hold executive roles will receive base pay and stock compensation only, with the stock element limited to the non-KPI-linked type.
Monex said the rewrite answers stronger demands from domestic and overseas investors for transparency, objectivity and tighter performance linkage in executive pay. It also said it has newly engaged HR Governance Leaders as an outside consultant to bring specialist input to the process, alongside a compensation committee whose majority is made up of independent outside directors and whose chair is also independent.
The practical point is that Monex has now disclosed the architecture more clearly: which metrics can shape annual pay, which ones can shape long-term stock awards, and how the standard pay mix differs between the chief executive and other executives. The annual indicators themselves are to be set each year by the compensation committee, so this is a framework for future awards rather than a statement of any one year's actual payout.