Tata Consultancy Services reported a drop in its CEO salary after company executives took a pay cut due to the covid-19 pandemic
MUMBAI: Among chief executives of India's top information technology (IT) companies, Salil Parekh of Infosys drew a pay package of around ₹40 crore ($6.15 million) in the last fiscal, up 27% year-on-year.
Infosys chairman Nandan Nilekani voluntarily chose not to receive any remuneration for his services. COO UB Pravin Rao’s compensation rose 29% to $2.2 million, while the two presidents, Ravi Kumar and Mohit Joshi, saw their remuneration rise to $3 million and $3.2 million, jumps of 25% and 24.6% respectively.
In comparison, Wipro’s chief executive officer Abidali Z Neemuchwala’s pay package rose 12% to almost ₹31 crore ($4.42 million) in FY20, according to a recent regulatory filing. June 1st was also Neemuchwala’s last day in the office as he made way for former Capgemini COO Thierry Delaporte.
Wipro’s chairman Rishad Premji and promoter (founder chairman) Azim Premji received a compensation of $0.68 million and $0.13 million in FY20, as both decided not to take profit-linked commissions in the fiscal.
"In view of the current situation caused by covid-19, uncertainty in business is likely to last for the next few months. To show solidarity with the team in facing the challenge Azim H Premji, founder chairman, has foregone the profit linked commission payable to him for the relevant period for financial year 2019-2020," Wipro said in the filing.
However, the largest company by revenue, Tata Consultancy Services (TCS), reported a drop in its CEO salary after the company executives took a pay cut due to the pandemic. Annual remuneration of TCS CEO and MD Rajesh Gopinathan shrunk 16.5% to ₹13.3 crore in 2019-20, according to the company's annual report. COO and executive director N Ganapathy Subramaniam took 13% lower remuneration and CFO V Ramakrishnan took 3.5% lower remuneration respectively.
“The managerial remuneration for the year decreased by 15%. The executive remuneration for FY 2020 is lower than FY 2019 in view of the economic conditions impacted by the COVID-19 pandemic. The directors have decided to moderate the executive remuneration for this year to express solidarity and conserve resources," said the TCS annual report.
IT companies have noted some structural concerns in supply and demand that hit revenues slightly in Q4 FY20 but are certainly likely to cause serious damage in Q1 and Q2 FY21.
Worldwide IT spending is projected to total $3.4 trillion in 2020, a decline of 8% from 2019, according to a forecast by Gartner, Inc. The coronavirus pandemic and effects of the global economic recession are causing leaders to prioritie spending on technology and services that are deemed “mission-critical" over initiatives aimed at growth or transformation.
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