Tatas Loosen Purse-Strings For Top Brass

In an attempt to retain as well as attract talent at the highest level, the Rs 40,000-crore Tata group has hiked the salaries of the managing directors, chief executive officers and whole time directors of various group companies.

The group has received shareholders' approval for the move at a series of recently held annual general meetings of various Tata companies.

The salary scale of group chairman Ratan Tata, also the executive chairman of Telco, has been hiked from Rs 30,000-70,000 to Rs 35,000-1,75,000 per month. Similarly, the scales of Telco's three executive director_V M Raval, S J Ghandy and F K Kavarana have been increased from Rs 20,000-60,000 per month to Rs 20,000-Rs 1,60,000 per month.

 

Tisco managing director J J Irani will now get Rs 35,000-Rs 1,75,000 per month, compared with the previous scale of Rs 35,000-Rs 75,000 per month

Similarly, Ishat Hussain, senior vice-president and executive director (finance), Tisco, who was recently appointed executive director in the Tata corporate office, is now entitled to receive Rs 20,000-Rs 1,60,000 per month. Earlier, he was drawing a scale of Rs 20,000-60,000 per month.

At the earlier scales, Hussain's gross emoluments worked out to Rs 27.10 lakh per annum while J J Irani drew Rs 36.18 lakh per annum.

Similarly, the salary scales of Indian Hotels managing director R K Krishna Kumar and deputy managing director S Ramakrishnan too have been increased.

Krishna Kumar's scale has been hiked from Rs 50,000-Rs 75,000 per month to Rs 35,000-Rs 1,25,000 per month, the scale of Ramakrishnan was hiked from Rs 50,000-Rs 75,000 per month to Rs 25,000-Rs 1,00,000 per month.

The decision to hike salaries, aimed at bringing the scales at par or around those of other major corporates, was primarily because the group is keen to recruit people at the highest levels from other leading corporate houses. Unless it could match the prevailing rates it would have been difficult for the group to atract fresh outside talent on the basis of the Tata name alone.

In fact the group has recently recruited the vice chairman of Hindustan Levers R Gopalakrishnan, as executive director with the group's corporate office. Hindustan Lever it may be mentioned has a salary ceiling which stipulates that the company can pay a maximum of Rs 40 lakh per annum each for a whole time director who is the vice chairman of the company. Besides, perquisites like furnished accomodation, medical claims upto Rs 7.5 lakh per annum,provident fund and super annuation benefits too are a part of the package.

"The Tata group obviously had to better the HLL package for Gopalakrishnan to join them. The group is also planning to recruit various other people at the highest levels and hence a salary revision was necessitated,"sources close to the Tatas told Business Standard.