Mitsubishi Motors Corporation (MMC) announced to its shareholders that they will not give out any dividends after the fiscal year 2019-2020. MMC CEO Takao Kato also announced that executives are taking pay cuts to share responsibility for huge financial losses incurred by the company.
The company reported a net loss of JPY 25.8 billion for the fiscal year ending in March 2020. The huge losses were compounded effects of lackluster sales and -like other global automakers- a huge sales drop caused by the global coronavirus pandemic.
Following a prior announcement that executives will be taking pay cuts in April, the official confirmation will reduce their overall pay by up to 45% through salary reduction and momentarily foregoing their performance bonus for the new fiscal year 2020-2021.
The MMC shareholder meeting was streamed live for 30 minutes in lieu of a usual one where shareholders could personally ask questions. This was due to the ongoing pandemic. There were only 30 participants, consisting of company directors and executives; all wearing masks and practicing proper social distancing. Stockholders were asked not to come, though a few did attend.
Interestingly one attending shareholder actually objected at the pay cut for the corporate officers or Mitsubishi Motors. It shows a stark contrast to the Nissan shareholder meeting in February where angry shareholders blasted at executives for the company's low performance and Renault-appointed Nissan Vice-Chairman Jean-Dominique Senard being spotted riding a Toyota Alphard.
And interestingly, one attending shareholder actually objected to the pay cut for the corporate officers and encouraged them to use their pay to help stimulate the domestic economy. Kato countered that it would not be right for them to be receiving the same remuneration since shareholders are not receiving dividends with the company declaring a huge loss.