No salary hikes for Hindustan Unilever’s CEO and CFO in 2016-17
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Mumbai: Average salary raises for managers at Hindustan Unilever Ltd, India’s largest packaged consumer goods company, moderated in 2016-17, according to the company’s annual report.
Salaries of chief executive officer and managing director Sanjiv Mehta and chief finance officer P.B. Balaji remained the same as in 2015-16.
Mehta took home Rs14.20 crore and Balaji, Rs8.33 crore in financial year 2017, according to a PTI report.
Management board members Pradeep Banerjee, executive director, supply chain, and Dev Bajpai, company secretary and executive director, legal and corporate affairs received hikes of 8% each, taking home Rs4.75 crore and Rs4.69 crore respectively. This was higher than the average percentage increase in the median remuneration of the company’s employees for the financial year, 3.42%, according to the same PTI report.
“The remuneration paid during the year is as per the remuneration policy of the company,” said HUL, adding the average increase is also an outcome of the company’s market position.
HUL had 5,976 permanent employees on its rolls as on 31 March 2017.
“Earlier this year, the parent has declared that it will improve its operating profit margins by 300 bps (basis points). India contributes 8-9% to Unilever’s revenues and hence, we can expect moderation and rationalization in salaries and advertising to take place here,” said Abneesh Roy, senior vice-president, institutional equities at Edelweiss Securities Ltd.
In the March quarter, staff costs were down by 12.4% and advertising and promotion expenses were down by 1.4% over the year-ago period.
To be sure, salaries of executives at HUL were raised a couple of years ago.
In fiscal 2015, Mehta’s salary rose by over 15%, according to a Business Standard report (bit.ly/1J49jru).
“In the last three to four years, salaries across industry have been on the rise. We can now expect some rationalizing to take place,” said K. Sudarshan, managing partner (Asia) at EMA Partners International, an executive search firm. According to Sudarshan, the threat of losing people is also not that high given the state of the job market.