Beike CEO Peng Yongdong's annual salary of hundreds of millions of yuan: It may be due to compliance requirements and originated from the WVR structure.

On April 17th, Beike issued an announcement stating that Peng Yongdong, the Chairman of the Board, Chief Executive Officer, and controlling shareholder of Beike, intends to donate 9 million Class A Beike common shares. After fulfilling the corresponding tax obligations, 50% of the after - tax funds from this stock donation will be used for the medical and health benefits of service providers in the housing industry and their family members, and the other 50% will be used for rental assistance for tenant groups such as fresh graduates. A special institution will be established for the long - term operation of this donation.

This move is regarded by the industry as a response to recent public discussions about Peng Yongdong's high annual salary.

Financial data released by Beike's official shows that since 2022, Peng Yongdong's "annual salary" has skyrocketed. In that year, it reached 475 million yuan, approximately 5.6 times that of the previous year. In 2023, it further rose to 713 million yuan.

The data for 2024 has not been released yet, but external attention has been increasing.

Some analysts believe that the fundamental purpose of Beike's move is not to provide high returns to the management, but rather related to its equity structure after listing.

When Beike listed in Hong Kong in May 2022, according to the listing rules of the Hong Kong Stock Exchange, for companies with a weighted voting rights (WVR) structure, the economic interest corresponding to the shares held by WVR holders (i.e., holders of super voting rights) must account for no less than 10%.

Beike also has a WVR structure, and before listing, Peng Yongdong, the Chairman of the Board, Chief Executive Officer, and controlling shareholder of Beike, who is one of the super voting rights holders, held relatively low equity. Therefore, to meet the listing requirements for super voting rights holders, with the approval of the Hong Kong Stock Exchange, Beike granted restricted stocks to Peng Yongdong. According to accounting rules, these restricted stocks are accounted for using the "straight - line amortization method", resulting in a large amount in the "equity compensation" item each year, which is not the annual salary in the general sense.

Simply put, Beike's move is to meet the listing requirements and provide voting rights protection for the founders' families and management as concerted action parties, thereby preventing potential risks such as "hostile takeovers" and providing a firewall for the stability of the equity structure.

The Hong Kong Stock Exchange revised its listing rules in 2018 to allow companies with a weighted voting rights structure to list, aiming to encourage more Internet and technology companies to list in Hong Kong. However, the exchange has strict regulations and restrictions on aspects such as the industry type, market capitalization, voting rights setup, and minimum shareholding ratio of WVR holders of relevant companies, with the goal of balancing the founders' control rights and the protection of investors' rights and interests.

On August 13, 2020, Beike was officially listed on the New York Stock Exchange, and then on May 11, 2022, it was listed on the Hong Kong Stock Exchange. Therefore, it must comply with the listing rules of both places.

As the successor to Zuo Hui, the founder of Beike, Peng Yongdong's "annual salary" started to rise significantly after Zuo's passing.

The weighted voting rights (WVR) structure is commonly seen in companies led by founders, especially innovative enterprises in the technology and Internet sectors. Founders often hope to maintain control over the company during its development to ensure that the company develops in line with their vision and strategic direction. The WVR structure allows founders to retain decision - making power even when their equity is diluted, preventing them from losing control of the company due to the influx of external investors. Internationally, Internet and technology companies such as Google and Facebook, as well as domestic companies like Alibaba and JD.com, all adopt such a structure.