Close on the heels of Bharti Airtel chief Sunil Mittal foregoing any pay hike this fiscal, the company on Wednesday said all its corporate directors and CEOs have volunteered for no salary hike in 2011-12.
“This is in line with the company’s efforts to drive cost efficiencies,” the telecom giant said in a statement.
“... all Corporate Directors and Chief Executive Officers (Asia and Africa) of the company have volunteered for no increase in their remuneration for the above mentioned period (fiscal year ending March 31, 2012),” it said.
The company, however, did not identify the officials foregoing their salary hikes for this year.
Total remuneration for all directors of Bharti Airtel rose from Rs. 29.89 crore in 2009-10 to Rs. 35.98 crore in 2010-11. Mr. Mittal’s pay package accounted for nearly three-fourths of the company’s total director remuneration in 2010-11.
The decision of the group’s top management officials to forego salary hike this fiscal follows an August 1 statement regarding Chairman and MD Sunil Bharti Mittal “volunteering for no increase in his remuneration for the FY 2011-12,” Bharti Airtel said.
It also said its India and South Asia operations have transitioned to a new organisation structure effective from August 1, with an aim to drive “greater business and functional synergies, providing a common interface to customers, and creating a de-layered and more agile organization.”
Bharti Airtel announced capping Mr. Mittal’s salary for the current fiscal on August 1 soon after its annual report disclosed a Rs. 4 crore, or 17 per cent rise in his remuneration to Rs. 27.5 crore in the previous fiscal 2010-11.
In its notice, issued the same day, for the upcoming AGM on September 1, Bharti Airtel also sought shareholders’ approval for Mr. Mittal’s re-appointment as MD for next five years at an annual pay package of up to Rs. 70 crore plus other benefits.
However, the company later said that the proposal was an enabling provision for the next five years and Mr. Mittal would not get any pay hike this fiscal.
Way back in October 2009, when there was a raging debate on right-sizing of CEO salaries, another corporate giant Reliance Industries had announced that its Chairman and MD Mukesh Ambani was capping his annual salary at Rs. 15 crore.
Pursuant to this Mr. Ambani’s pay has remained unchanged at Rs. 15 crore for three consecutive years, including this fiscal year. Prior to that, he was India’s top-paid executive with remuneration of over Rs. 44 crore in 2007-08.
In May this year, RIL’s annual report showed that Mr. Ambani was eligible for a package of Rs. 38.75 crore for 2010-11, but his salary remained capped at Rs. 15 crore.
RIL said the decision was taken to reflect “his desire to continue to set a personal example for moderation in managerial compensation levels.”
