Telecom, Fisher and Paykel Appliances and Air New Zealand have all recently announced pay freezes or pay reductions as the global financial meltdown continues.
Ongoing publicity about bonuses being paid to executives of bailed out United States companies continues to raise resentment there, particularly when it was revealed insurance company AIG paid executives $US165 million ($NZ308 million) in bonuses.
Mortgage company Fannie Mae announced it was planning to pay retention bonuses of as much as $US611,000 each to key executives this year as part of a plan to keep hundreds of employees from leaving the government-controlled company.
Fannie Mae recently requested $US15 billion in federal aid while rival mortgage finance company, Freddie Mac, which is also planning similar awards, sought a total of almost $US45 billion in aid.
ABN Amro Craigs broker Peter McIntyre said shareholder action groups in New Zealand had started taking a closer interest in remuneration packages being sought and paid by New Zealand companies.
The Contact Energy board pushed through its own increased remuneration but the NZX option scheme for chief executive Mark Weldon was eventually voted down by shareholders.
The NZX had a best corporate governance code which stipulated that the principles of remuneration had to be transparent, fair and rea-sonable.
"The situation in the US with CEO bonuses has put all re-muneration packages under scrutiny.
"The pay cut of Fisher and Paykel Appliances chief executive John Bongard is a good example of that."
In New Zealand, salaries did not include as many "at risk" components as Australia.
It was always a difficult line to define when some chief executives were adding value for shareholders and some obviously were not, Mr McIntyre said.
One side of the argument was that adding shareholder value should be one component of the package but others believe it should be the only component.
Asked if he thought the moderation in packages was likely to continue into the future, Mr McIntyre said history had a way of repeating itself, but pay structures would not be the same again after the current crisis had been resolved.
Companies which had received a bail-out in the US were unlikely to be able to negotiate such golden packages and those in New Zealand which had received the Crown guarantee would come under scrutiny from the Government.
"Our Ggovernment won't be keen to see chief executives of Crown guaranteed entities ratchet up their salary package. The Government is already doing that by running a ruler over all SOEs," he said.
Polson Higgs senior human resources consultant Ross Hanson said expectations about salaries and bonuses for New Zealand chief executives had been lowered substantially since November last year, especially if they were tied to sales or production.
"None of this will be a surprise but if sales are down and manufacturing is pessimistic, and your bonus is attached to either of those, then expectations for payment are down through this quarter and the next.
"Even though the financial year doesn't end until March 31, the signs are there for reduced profits.
"Trading in the south has not been as badly dented as in Auckland in Wellington, but all of that news from the north drives confidence in the south."
Bonuses in New Zealand were far less sophisticated than what was being seen in the US, he said.
In the US, chief executives and company presidents had all sorts of options tied to their remuneration.
The reason the bonuses were still being paid out was because of the "massive contractual obligations" put in place before the economic crisis.
In New Zealand, up to 20% of the total remuneration was "at risk", meaning it was only paid if performance targets were met.
Usually, it was a straightforward agreement to meet sales or production targets, Mr Hanson said.
"The risk component is typical of New Zealand agreements - straightforward and keep it simple.
"People know what they are getting rather than scrapping with the board over entitlements from `better customer care'. What does that mean?"
However, it had to be remembered that the bonuses in New Zealand were "peanuts" compared with those being talked about in the US, Mr Hanson said.
