The chief executive officer of India’s largest IT company Tata Consultancy Services Ltd, K Krithivasan, is the least paid among the top six Indian tech services companies.
For the financial year ended March, Krithivasan received a compensation package of $3.1 million or ₹25.4 crore.
Unlike other IT services companies, TCS does not offer employee stock ownership plans (ESOPs). Salaries of peers’ CEO are high on account of the ESOPs paid to them.
Krithivasan’s first-year remuneration is $0.4 million less than his predecessor Rajesh Gopinathan, who stepped down as CEO of the IT services firm in March 2023.
Much of the remuneration–$2.5 million–came from commissions, according to the IT bluechip’s annual report for the financial year ended March 2023, released on 9 May 2024.
As much of the CEO compensation comes from commissions due to the shares they are awarded, their remuneration increases compared to their employees’ median salary.
In TCS’ case, Krithivasan’s salary is 314.5 times that of the median salary of TCS employees.
TCS did not respond to Mint’s queries confirming the number till press time.
As part of revenue, Krithivasan’s salary is 0.01% of the company’s $29.1 billion revenue for the financial year ended March. In comparison, S Ravi Kumar of Cognizant Technology Solutions Corp receives 0.11% of his company’s revenue.
The Mumbai-based IT company, much like its Indian IT peers, pays remuneration to its managing director and executive directors by way of salary, benefits, allowances, and commissions. While allowances are the fixed component, commissions form the variable component of the remuneration.
The TCS chief executive, who took office on 1 June 2023, earned $0.15 million as his actual salary and $0.37 million as part of allowances, benefits, and perks, as per the FY24 annual report.
TCS has never appointed an external person for the top job. This makes many believe that people appointed internally go on to earn less than external candidates.
For instance, former Wipro CEO Thierry Delaporte who was an external hire, got $10.1 million in remuneration in his last year in office, while his successor Srinivas Pallia, a Wipro veteran for three decades, is expected to receive around $7 million in his first year as CEO, as per a company filing.
Cognizant’s CEO Ravi Kumar earned $22.6 million or ₹186.2 crore in FY23 due to a one-time stock reward, making him the richest chief executive of all Indian IT companies.
To be sure, Cognizant, an Indian heritage IT company listed on Nasdaq, follows a January-December financial calendar, while Indian IT companies follow an April-March financial year.
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Published: 10 May 2024, 10:25 AM IST