TCS to Cognizant: Who is the highest paid CEO in Indian IT sector?

Cognizant's chief executive officer (CEO) Ravi Kumar Singisetti received $22.56 million (approximately Rs 186 crore) in compensation last year, primarily due to a one-time stock reward, making him the highest-paid Indian executive in the Indian information technology (IT) sector, Mint reported.

Singisetti, 52, who became the leader of the Nasdaq-listed firm in January 2023, received shares valued at $20.25 million (nearly Rs 169.1 crore) last year, according to a filing by the company dated April 12.

Cognizant's filing with Nasdaq mentioned the CEO’s performance stock units (PSUs) and restricted stock units (RSUs). "The PSUs have a target value of $3,000,000, with a payout range from 0 per cent to 250 per cent of the target over a four-year performance cycle based on the absolute total shareholder return of the company's common stock," said the company.

"Additionally, an equity award comprising RSUs with a grant date value of $5,000,000, which was a buyout award to replace forfeited equity awards from his previous employer. Since the PSUs are subject to the performance condition described above, the actual payout may significantly differ from the target value attributed to them, potentially resulting in no payout at all."

In terms of CEO compensation as a percentage of company revenue, Singisetti leads the Indian IT services sector. His remuneration accounts for 0.11 per cent of Cognizant's $19.35 billion revenue last year.

How much did other IT CEOs earn

Wipro Ltd's former CEO Thierry Delaporte received $10.1 million (Rs 83 crore), which was 0.089 per cent of the company's $11.16 billion revenue. C Vijayakumar's promised remuneration of $10.65 million (Rs 88 crore) represents 0.085 per cent of HCL Technologies Ltd's $12.58 billion revenue, according Mint.

Accenture Plc paid $31.55 million as remuneration to CEO Julie Sweet, or 0.049 per cent of the company's $64.1 billion revenue.

Separately, Infosys CEO and managing director Salil Parekh's remuneration of $6.8 million (Rs 56.4 crore) represents 0.037 per cent of the company’s $18.1 billion revenue.

Tata Consultancy Services compensated its former CEO Rajesh Gopinathan with $3.5 million (Rs 29.16 crore), which accounts for 0.012 per cent of the company's $27.9 billion revenue, before K. Krithivasan assumed the role in June last year.

CEO salaries compared to employees

Reportedly, Singisetti's compensation stands at 556 times the median salary of Cognizant employees, said Mint. Delaporte's salary was 916 times the median remuneration of a Wipro employee. Sweet's compensation was 633 times at Accenture.

Infosys’ Parekh's pay was 627 times the median remuneration, while Rajesh Gopinathan and Vijayakumar's pay was 427 times and 253 times the median remuneration at TCS and HCL Technologies, respectively.

Cognizant’s struggle with revenues

Singisetti's substantial compensation, given that he joined from Infosys Ltd, coincides with Cognizant's struggle to match its peers such as TCS, Infosys, and HCL Technologies. Cognizant's revenue declined by 0.38 per cent from $19.43 billion in 2022 to $19.35 billion last year, while the operating margin decreased from 15.3 per cent in 2022 to 13.9 per cent.

Last year, Cognizant reduced its workforce by 3,500 employees, equivalent to a 1 per cent reduction, in order to improve profitability. As a result, the total headcount declined by 2.1 per cent, from 355,300 at the end of December 2022 to 347,700 by the end of the year.