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Business News/ Companies / News/  Premji, Kurien compensation up even as growth slows at Wipro

Premji, Kurien compensation up even as growth slows at Wipro

For fiscal year 2013, executive chairman Premji’s total compensation nearly doubled to $733,827

Azim Premji. Photo: Aniruddha Chowdhury/Mint (Aniruddha Chowdhury/Mint)Premium
Azim Premji. Photo: Aniruddha Chowdhury/Mint
(Aniruddha Chowdhury/Mint)

Bangalore: Wipro Ltd’s billionaire founder Azim Premji and chief executive officer (CEO) T.K. Kurien both got a raise in annual compensation in a year during which the company posted sluggish growth and fell further behind rivals Tata Consultancy Services Ltd (TCS) and Cognizant Technology Solutions Corp.

On Thursday, India’s third largest software services exporter also warned that the proposed immigration Bill in the US, its largest market, could “have a material and adverse effect" on its revenue and operating results.

For the 2012-13 fiscal year, executive chairman Premji’s total compensation—including allowances, commissions from variable pay and other long-term benefits—nearly doubled to $733,827 (around 4.29 crore) from $388,702 in the previous year, according to regulatory filings to the US Securities and Exchange Commission (SEC).

Premji’s compensation, which does not include earnings from his stock holdings in the company, was boosted by a more than doubling of variable pay benefits to $518,660.

As of 31 March, Premji and his family held about 78.3% of the company. According to Bloomberg data, Premji earned about $231 million from dividend payouts in the 2012-13 fiscal. The stake is now at about 75% after the Azim Premji Trust recently transferred 61 million equity shares in the company to a trust controlled by a public financial institution. The move enabled Wipro to meet the regulatory norm requirement of a minimum public shareholding of 25%.

Premji’s earnings from his stock options place him much higher in the ranks of other co-founders and CEOs of technology firms in Silicon Valley and elsewhere, such as Oracle Corp. co-founder Larry Ellison, International Business Machines Corp. (IBM) CEO Virginia Rometty, Yahoo Inc. CEO Marissa Mayer and Hewlett-Packard Co. (HP) chief Meg Whitman.

While Ellison, who is the highest paid CEO in Silicon Valley, took home $96 million this year largely due to his stock holdings in Oracle, Mayer of Yahoo earned $36.6 million in 2012. Rometty of IBM received about $16 million, while HP’s Whitman got $15.4 million in total compensation for 2012.

Kurien’s total annual salary, including all benefits and allowances, increased to $888,228 from $860,389 last year. His total compensation, too, does not include earnings from stock options.

In comparison, Natarajan Chandrasekaran, CEO of India’s top software services firm Tata Consultancy Services Ltd (TCS), received a total annual package of about 11.7 crore (around $2 million), including all allowances and commissions, against 8.01 crore in the preceding year.

US-based Cognizant Technology Solutions Corp.’s CEO Francisco D’Souza made $10.6 million in 2012, including bonuses and dividends, according to a PTI report in May. His 2011 compensation figure wasn’t available as Cognizant doesn’t disclose individual salaries.

At India’s second largest software exporter Infosys Ltd, CEO and co-founder S.D. Shibulal earned about $120,000 in 2012-13, inclusive of bonus and benefits, down from $162,990 in the previous year.

Shibulal and his family, however, made about $9.7 million in dividend payouts in 2012-13, according to Bloomberg data.

In 2012-13, Wipro continued to disappoint investors who were expecting a turnaround under CEO Kurien, who took over the role in 2011. The company forecast weak revenue growth for the first quarter of this fiscal year, raising concerns over its long-term ability to catch up with TCS and Cognizant.

Like other IT firms, Wipro has raised concerns over the proposed immigration Bill that is being pushed by senators in the US, saying it could hamper the company’s growth in North America. Wipro earns a little over 50% of its annual revenue from the US.

“Restrictions on immigration in the US may affect our ability to compete for and provide services to clients in the US, which could hamper our growth and cause our revenue to decline," the company said in a filing to the SEC on Thursday.

“If those proposed provisions are signed into law, they could have a substantial impact on our hiring practices or capacity to complete client projects, and our cost of doing business in the United States could increase and that may discourage customers from seeking our services," the company said.

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Published: 14 Jun 2013, 01:13 AM IST
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