EVEN Singapore's highest-paid bosses felt the pinch last year with take-home pay among the million-dollar earners down sharply, a trend set to continue.

Only 15 per cent of 60 blue-chip firms surveyed by Ernst & Young paid their chief executives packages of over $5 million - down from 23 per cent in 2007.

'Companies appeared to be taking a more moderate view towards executive compensation,' said Ms Julia Smith, its performance and reward leader here.

Related link: » S'pore exec pay rose in year of squeeze

'There were no dramatic swings in the total compensation levels for senior executives.'

It is not hard to see what drove the pay squeeze - the economic downturn, especially within the financial sector.

Take OCBC chief executive David Conner. He was in the $5 million club in 2007 but his pay last year fell 40 per cent to between $3.75 million and $4 million.

United Overseas Bank chief executive Wee Ee Cheong saw his package trimmed by about 8 per cent from 2007 although he remained in the club, earning between $5.5 million and $5.75 million.

The tech sector's woes were reflected in the pay packet of Venture Corp chief executive Wong Ngit Liong.

In 2007, he earned as much as $6.5 million but this declined to about $4 million last year, in part because of the decline in the value of his options.

A Straits Times check found a number of bosses still in the over $5 million club, including outgoing Singapore Exchange chief executive Hsieh Fu Hua and City Developments' Kwek Leng Beng.

The E&Y survey checked last year's annual reports for the 60 largest firms listed here, excluding those where detailed information was not available and companies with a primary listing base overseas.

The survey showed the spread of CEO pay packages upwards of $250,000. The largest proportion - 27 per cent - fell in the $3 million to $4 million band, including developer Wing Tai's Cheng Wai Keung.

At the lower end of the spectrum, the proportion in the $500,000 to $1 million band shrank from 10 per cent to 7 per cent.

The proportion of CEOs receiving between $250,000 and $500,000 held steady at 5 per cent. One was Hyflux boss Olivia Lum, who described 2008 as a challenging year for the water treatment firm.

Some traditional top earners do not come from the largest companies.

Mr Jopie Ong from medium-sized Metro Holdings, for example, took home between $9 million and $9.25 million for the year ended March 31, 2008, after the sale of a property. In the 2009 financial year, the figure dived to $3.5 million.

Remuneration committees are responsible for reviewing CEO pay.

Mr Robson Lee, a partner in law firm Shook Lin & Bok, chairs several of these committees. He said: 'When we make adjustments to the base salary or variable bonus, we do look at data of comparable businesses, and also see what the CEO can contribute in the next few years.

'We also take into account his track record. During this downturn, we are conscious of the sentiment of minority investors towards overpaying CEOs.'

E&Y's Ms Smith expects the moderate approach to continue.

She said the challenge is to strike a balance between rewarding and retaining key executives needed to drive business through the downturn while explaining to shareholders how pay ties in with performance.

Managing director Jon Robinson of consultancy Freshwater Advisers expects packages for this year to be lower than last year, partly because base salaries are unlikely to rise much and bonus levels may not have recovered. Firms are still likely to be focused on controlling costs.

But as the business climate rallies, so will profits and this should mean higher bonuses next year, added Mr Robinson.

If the stock market keeps rising, the value of performance shares awarded to employees will rise, adding to the overall value of the package.

Top management pay in Singapore has not been as contentious as in the United States, where regulators are clamping down on excessive pay, especially in banks.

US Treasury Department paymaster Kenneth Feinberg has ordered pay cuts averaging more than 50 per cent for 136 executives at seven banks which have still not repaid the US government bail-out money. The affected banks include Citigroup and Bank of America.