With an annual remuneration limit of Rs 10 crore, T K Kurien, the recently-appointed Chief Executive Officer of Wipro’s information technology business, has become the highest paid executive (excluding stock options) in the Indian IT services segment.
With a target to get the IT business back on growth, Kurien will get a salary in the range of Rs 3 crore to Rs 10 crore per annum. According to the statement by the company on the Bombay Stock Exchange (BSE), Kurien has been appointed the CEO for five years. His salary will include periodic increments as may be approved by the board within the above limits and will also include variable pay (based on performance criterion) among other benefits.
In addition to the remuneration, the statement said, the CEO will be entitled to perquisites and other allowances, including employee stock options, grant of restricted stock units and other stock-based compensation.
Kurien’s salary is even higher than Cognizant’s CEO Francisco D’Souza. For 2010, D’Souza received a salary of $539,100 (around Rs 2.4 crore) and bonus of $816,968 (around Rs 3.67 crore). For 2011, D’Souza will draw a salary of $566,500 (around Rs 2.54 crore).
Suresh Vaswani and Girish Paranjpe, the erstwhile CEO’s of Wipro, drew Rs 3.1 crore and Rs 2 crore in the 20-010, respectively.
Human resource consultants were of the view that Indian IT services top management compensation was much lower than the global standards. “There are a few reasons, like many get stock options. So, in the case of Infosys, the current CEO might not get an equivalent salary as his peers, but his stock option will be much more than others. The variable component of the salary at these levels is much higher,” said a senior HR consultant on condition of anonymity.
Take the case of Tata Consultancy Services, CEO and MD N Chandrasekaran received a total compensation of Rs 3 crore for the financial year 2009-2010. This included salary of Rs 46.7 lakh, perks allowance of Rs 51.12 lakh and commission of Rs 2 crore.
Similarly, S Gopalakrishnan, co-founder, CEO and MD of Infosys Technologies drew salary of Rs 1.01 crore per annum for 2010. However, as a co-founder, Gopalakrishnan holds 1.16 per cent stake in the company. With around 66 million shares, the total value of his stake at today’s stock price of Rs 2,922 per share comes to Rs 19.3 crore.
The only other CEO that comes near to what Kurien or D’Souza earns is HCL Technologies CEO Vineet Nayar. For the year ended June 2010, Nayar’s compensation amount was Rs 4.54 crore. Besides 1,000,000 equity shares.