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HYBE Chairman Bang Si-hyuk declared he would collect a symbolic remuneration of 1 won ($0.00076) each year starting in 2024. On March 8, 2024 (KST), HYBE announced the news via their "2024 Internal Director Compensation Plan." As part of the "Pay for Performance" remuneration concept, this plan sets the chairman's base salary at KRW 1. The goal of this strategy is to make management's accountability stronger.
The decision aims to stress HYBE's 'Pay for Performance' compensation concept and to further Bang Si-hyuk's management as chairman, the firm said in its 2024 in-house director remuneration plan on Friday.
HYBE's Bang Si-hyuk earns a whopping $743,000 along with his salary of KRW 1 ($0.00076) for 2024
Based on management performance and assessment metrics, the company's remuneration committee determined this figure in 2023. However, Bang Si-hyuk aka Bang PD's overall earnings from HYBE Corporation surpass the KRW 1 wage, as the company's short-term incentive plan entitles him to a bonus of 980 million won ($743,000).
This is a big change from the previous year when he was paid KRW 300 million ($227,825 approximately) in bonuses in addition to KRW 50 million ($11,391.25 approximately) in salary. His overall pay was KRW 357 million ($271,111.76 approximately), with an extra KRW 7 million (about $5,315.92) coming from various sources of income.
Experts in the field believe that Bang Si-hyuk's unusual choice is a calculated tactic by his company to stimulate creativity in the K-pop sector. By opting for a low wage, he could have aimed to promote a culture in which individual contributions are highly valued and the yearly profit would be increased given that BTS's military enlistment has left a huge dent in its turnover.
After BTS's military enlistment in 2023, HYBE shares have seen a dip in stocks. Even in the Q4 report of the fiscal year 2023, despite a fourth-quarter net loss of KRW 53 billion, or $39.8 million, which was less than in 2022, the earnings increased year over year.
In 2023, an increase in album sales for HYBE artists was witnessed with a total of 43.6 million units sold. Members of BTS had great success with their solo albums, selling 8.7 million copies worldwide, while Seventeen's album sales totaled 16 million. NewJeans, Tomorrow X Together, and Enhypen are other K-pop bands that have sold 4.4 million, 6.4 million, and 4.26 million units, respectively.
What is the concept of a $1 salary and why do top CEOs opt for it?
For the uninitiated, many powerful figures in government and big business have accepted salaries of under $1 per hour. One-dollar wages are applied when a CEO or founder aims to work without receiving any money directly from the company, but legally they have to be paid something over zero to avoid being considered volunteers.
These wealthy CEOs and co-founders take home more than just their $1 salary from their businesses. Although their capital profits tax is typically lower than the income tax on high-salary paychecks, they use the modest wage as remuneration in the form of business shares or shares and performance-linked incentives.
Notable members of the "$1 salary" club include former CEO of Twitter Jack Dorsey, Mark Zuckerberg of Facebook, and Elon Musk of Tesla; co-founders of Google, Larry Page and Sergey Brin; Apple co-founder Steve Jobs; N. R. Narayana Murthy of Infosys; and co-founder of Oracle, Larry Ellison, among others.
Earnings are linked to the success of the business when remuneration takes the shape of stock, equity, or bonuses. As a result, even the company's investors gain more confidence as it is more likely that people will work hard when their pay is dependent on the success of the business.
Meanwhile, the remuneration package of HYBE Corporation CEO Park Ji-won has also increased. In 2024, his salary total will be KRW 1 billion ($7,59,169 approximately), and an additional $7,59,169 in bonus. This records an increase in the previous year's salary and bonus totaling KRW 916 million (about $695,399) and KRW 600 million (about $455,501.58), respectively.
Park Ji-won succeeded Bang Si-hyuk as the CEO of HYBE Corporation in 2021, after the latter resigned from his position and took the reigns as the company's chairman.
HYBE joined the K-pop label market in 2019 after being founded in 2005 as BigHit Entertainment. The firm saw a major metamorphosis along the way, leading to its renaming as HYBE Labels in 2021, with important buy-outs such as Source Music, ADOR, KOZ Entertainment, and Pledis Entertainment, among others.
