By Steve Kelman

Blog archive

The Lectern: Shared sacrifice in Asia

I noticed a headline in one of the English-language newspapers here in Taiwan, where I am staying for a week to work on a case for use in teaching at Harvard.  It read, "Taipei Mayor Will Donate 10% of Salary to Help Needy People."

The article reported that the Taipei mayor planned to donate 10 percent of his salary each month to local food banks.

This follows on the heels of an announcement in January by the government of Singapore that senior government officials would take 10-20 percent salary cuts in light of the nation's economic crisis. The Singapore situation was, perhaps, special because senior Singapore government officials are by far the best-paid in the world, sometimes taking in salaries of over a million dollars, and they also have a pay-for-performance component that is partly tied to the country's overall economic growth rate.

However, this move was followed last week by a similar announcement in South Korea that senior officials, military officers, and university presidents would return 10 percent of their salaries back to the national Treasury.  Furthermore, the president of South Korea announced that he will be donating his entire salary for the next five years to help the poor. (The South Korean president is independently wealthy.)  The president has also personally apologized to the nation for failing to achieve his campaign pledge, before the crisis, of increased economic growth.

It is interesting that these kinds of symbolic steps are seeming to get more resonance in Asia than elsewhere. As social scientists of course know, correlation doesn't prove causation, but it is interesting that these cultures with a sense of shared responsibility -- the stark opposite of the reaction of the Wall Street traders who believed they should get bonuses because their little unit made money, even as their firms went down in flames -- are doing so well growing economically in a world where cooperation within firms and other organizations is increasingly necessary for organizational success.

Any readers, particularly Asian readers, have a thought about this?

Posted by Steve Kelman on Feb 26, 2009 at 12:08 PM


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