There has been a lot of talk recently of bringing salaries of employees and CEOs more in balance . But not much has changed in major listed companies even as firms have started publishing the "remuneration ratio" - the salary of directors compared to the median employee in their company.
SUN TV has got a fair amount of press for the salary it pays its Managing Director Kalanithi Maran, which is a staggering Rs. 87 crore per year. Perhaps for understandable reasons, they did not publish the remuneration ratio of this salary compared to SUN TV's median employee in company reports.
Pawan Munjal, MD of Hero Motocorp and Sajjan Jindal, the MD of JSW Steel, get paid less than Maran at Rs. 75 crore and Rs. 48 crore annually. Munjal gets 838X the salary of the company's median employee (which is Rs. 9 lakh according to the firm), while Sajjan Jindal gets 793X.
In the FMCG sector, competition for senior personnel is reportedly fierce, but the ratios here are smaller. The remuneration for ITC's MD was 398X the median employee, and at HUL it was 194X. At Asian Paints, KBS Anand's is 181 times the median Asian Paints employee.
Software used to be a place where fairness and flat organizations used to be touted, but salaries for senior management have blown up in the past decade. Infosys, whose founder Narayana Murthy often said that salaries for CEOs should be maintained at 25:1 ratios, now has a remuneration 396X the median employee for Salil Parekh, the current CEO, higher than most of its peers. At Wipro, CEO Abidali Neemuchwala has a remuneration of 337X the median, while Rajesh Gopinath's is 262X.
The financial sector saw a wide range, from 248X for HDFC Bank to 48X for Kotak Mahindra Bank. Was there anyone who met NRN's standard? There was one CEO of the shortlist surveyed, Umesh Ravenkar of Shriram Transport Finance, whose remuneration was 22X the median employee, below the 25x cutoff.
