China bankers told to ditch displays of wealth
As the country recovers from the impact of multiple Covid lockdowns, financial companies in China have asked staff to refrain from sporting expensive clothes, bags and watches, and splashing out on luxury dining and entertainment.
Financial professionals in China have come under fire for showcasing their “flashy” lifestyles while much of the country grapples with austerity.
According to a report by Reuters, China’s top watchdog vowed earlier this year to eliminate any notion of a Western-style “financial elite” and to rectify the excessive pursuit of “high-end taste”, a stance that could have an impact on the sales of fine wine and rare spirits.
Unnamed staff at at both a large Chinese state-owned mutual fund and a mid-sized bank have been instructed not to show off high-end lifestyles, says Reuters. This includes posting pictures on social media of expensive meals, clothes or bags, revealed one employee.
Staff have allegedly also been told they can no longer stay at five-star hotels when travelling for work.
Reforms announced in March by China’s securities regulator called for banking staff’s pay to be put on a par with that of civil servants.
As a result, CITIC Securities is cutting pay for its employees by 15%, while China International Capital Corps have slashed bonuses for investment bankers by up to 50% this year as Beijing attempts to close a widening income disparity.
Behind the move to play down the wealth of financiers is both a desire to not be seen as violating the ideology of the Communist Party, as well as a drive to clamp down on corruption within China’s $57 trillion financial sector.
Cutting the benefits of financial elites is one way of maintaining social and political stability during a period of record unemployment and economic uncertainty for people and businesses rebuilding after the chaos of the last three years.