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| Anti-vulgar salary slogan finds support outside industry |
| Press Trust of India / New Delhi Oct 05, 2009, 19:28 IST |
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Corporate Affairs Minister Salman Khurshid's idea of trimming 'vulgar' salaries of CEOs received support from within the government, but the industry warned that any regulation would lead to flight of talent.
"Globally it is the concern. There is no regulation on CEOs' salary. It is the responsibility of corporate boards to fix salaries judiciously... (the concern) is right also," Planning Commission Deputy Chairman Montek Singh Ahluwalia said today.
Even though the government would not prescribe the ideal pay, "they (corporate) must reflect", said Commerce Minister Anand Sharma, reacting to a suggestion to companies by Khurshid against paying CEOs "vulgar" salaries.
Khurshid had more tips for industry heads today. "We follow the footsteps of Mahatma Gandhi and (must) try to lead our life with much simplicity."
"Display of affluence is unacceptable... It is simply impossible to say that we will shut our eyes and let anybody do what they please but at the same time I cannot say we will bring a regime of control," Khurshid added.
The industry was not the one to take this lying down and said any regulation of CEOs' pay may lead to flight of talent and that salaries are best decided by the industry.
"Any new norms on compensation to India CEOs may set in motion a flight of talent and capital away from the country," industry chamber Ficci's President Harsh Pati Singhania said.
CEOs' salary, Sharma said, had been a hot topic of discussion even at various international fora like the G-20, the European Union and in America.
Heads of apex industry chambers said that they would like the issue to be settled by and within India Inc.
A CII task force, under the chairmanship of former Cabinet Secretary Naresh Chandra, is studying the key issues of corporate governance, including the compensation packages of senior management.
"CII has always believed that corporates have a social responsibility and always supported self regulation..," its President Venu Srinivasan said.
Khurshid separately clarified that the government does not intend to control remuneration in India Inc.
"The idea of control has become old, but no control does not mean there is no regulation... I am not for control, I am for regulation," he said.
Khurshid buttressed his argument, saying even Americans are trying to resolve the issue of CEOs' high salary. "The President of America has used the word greed. It is not an easy word. It is a tough word because what happened in US led to worldwide recession.
"They are trying to find their solution. We are trying to find our solution. Our solution is that we can solve the issue by example, we can solve the issue by dialogue," he said.
Assocham said while it favoured the austerity measures, the market forces and the issue of attracting talent cannot be brushed aside.
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