It's hard to keep your nerve when pictures of corporate executives being carted off to jail flash by on CNN. It's even harder when you see a high-level WorldCom executive moving forward with plans for a $15 million beachfront mansion in Florida. Only rarely have I seen that sort of public manifestation of wealth here in Taiwan. To be sure, greed exists here just like anywhere, but it has not reached such epic proportions.

Another noteworthy difference in corporate life here is that the well-being of CEOs is usually closely tied to that of the company. Instead of stock options, the chief executive officer-and indeed, all employees-generally get outright stock grants as a part of their salary packages. That encourages all involved to keep the company healthy.

The downside is that Taiwan's GAAP does not require that these grants be treated as expenses. So they are subtracted from earnings that would otherwise be paid out to investors. That sometimes peeves investors, especially foreign ones, and arguably provides an unfair advantage over some foreign companies, which would have to treat such disguised salary as an expense. No system is perfect.

TSMC has been a leader in many ways in Taiwan, but on the issue of changing the stock grant system, the company said don't expect much. The system has been around a long time and is a core incentive for most employees in many publicly traded companies. Chang believes he would lose too many good people if he tried to introduce a change.

Most Taiwanese investors don't seem to be too concerned about the system anyway. Instead, they are waiting for TSMC's semiconductor sage to return to his bullish ways. That may take a few months. Chang's uncertainty about growth this year has translated into a $500 million cut in capital expenditures, which may deepen, and a slowdown of the foundry's 300-mm wafer program.

Doubt is creeping into next year's outlook, too. TSMC president Rick Tsai said the Semiconductor Industry Association's forecast of 23 percent growth in 2003 is probably too optimistic. So prepare for the worst, hope for the best. Then maybe the news won't seem so bad.