Recently, the news of the collective salary cut of Country Garden's executives has attracted a lot of attention. Yang Huiyan, Mo Bin, Yang Ziying, Chen Chong and other executives took the initiative to request salary cuts, and their annual salaries dropped from millions of yuan before the adjustment to only 120,000 yuan. At the same time, they gave up a series of benefits, such as executive car allocation, executive physical examination reimbursement, executive free canteen, etc.
This move was interpreted by the outside world as a fulfillment of the Country Garden family's commitment, and it was also seen as a dance of the executives' shyness towards the company. While such a pay cut sounds moving, in reality, it is just a public relations ploy that is superficial and loud and low. Executives have amassed a significant amount of wealth before this, and their quality of life will not be affected too much. Importantly, the salary cuts for executives have not fundamentally changed for ordinary people who have difficulty buying a house. Therefore, although this collective executive salary cut has a certain demonstration effect, its actual impact may be limited.
It is worth mentioning that behind the decision of Country Garden's executives to cut salaries, there is actually a concern about the debt problem. According to Country Garden's semi-annual report, as of the first half of 2023, Country Garden's current liabilities have reached 12 trillion yuan. This means that the company is facing severe debt pressure, and the salary cuts of executives are also intended to reduce the financial burden on the company. However, the debt problem cannot be solved completely through executive pay cuts, and it requires broader reform and adjustment to achieve true sustainability.
Real estate giants have long been regarded as "vampires" by the outside world, using various means to obtain profits. Not only do they collect money from home buyers, but they also get money from banks through illegal lending, and they go crazy for the pursuit and expansion of wealth. However, this quick access to wealth is not sustainable, and it often leads to over-reliance on borrowing and borrowing and eventually high levels of debt.
Evergrande Group, similar to Country Garden, is a vivid example. Due to its over-expansion and borrowing, it has led to a large number of unfinished buildings, which has brought great disasters to countless families. Interestingly, however, we don't know much about the problem of unfinished buildings owed by Country Garden. According to the data, the number of unfinished buildings in Country Garden is more than three times that of Evergrande. This means that more families are affected and caught up in it.
Behind the collective salary cuts of the executives of the real estate giants, their debt problems and the difficulties of the entire industry are highlighted. While salary cuts, as an exemplary behavior, can demonstrate a sense of social responsibility among entrepreneurs and executives to a certain extent, they are not enough to solve the fundamental problem.
After much deliberation, I believe that companies need to shift their thinking from a single path of wealth and expansion to a path of sustainability. This means that companies need to pay more attention to risk control, avoid over-reliance on borrowing, and avoid high debt risks. At the same time, companies should focus more on providing high-quality real estate products and services to provide a better living environment for home buyers. Only in this way can enterprises truly achieve sustainable development and make greater contributions to society.
To sum up, although the collective salary reduction of Country Garden's senior executives has a certain exemplary effect to a certain extent, its actual impact is limited. In their pursuit of wealth and expansion, real estate giants often overlook the importance of risk control and sustainable development. Therefore, companies need to think about a more comprehensive and sustainable development path to achieve long-term success.