Infosys’ independent board member Kiran Mazumdar Shaw on Wednesday said that company’s newly-appointed CEO and MD Salil Parekh would receive a package of Rs 16 crore. “Infosys CEO Salil Parekh will be paid a fixed salary of Rs 6.5 crores. He would be eligible for variable pay of Rs 9.75 crores at the end of the fiscal year,” Shaw told PTI. According to her, Parekh would also receive Rs 3.25 crores in restricted stock units and Rs 13 crores in annual performance equity grants.
Infosys appointed Parekh last year in December. He replaced Vishal Sikka, a high-profile techie who put down his papers following the differences between the Infosys Board and the founders. One of the reasons Sikka left Infosys was constant attack from the company founder NR Narayana Murthy over top executives’ hefty pay.
Parekh’s annual package is one-third of what his predecessor Vishak Sikka got during his tenure at Infosys. Sikka drew an annual package during 2015-16 of a whopping Rs 49 crore which was much higher than his counterparts in other Indian IT companies. During the same fiscal, the then TCS chief N Chandrasekaran was paid a package of Rs 25.6 crore and Wipro CEO Abidali Neemuchwala’s annual pay was Rs 12 crore.
Sikka’s salary was revised from $7.08 million to $11 million with effect from April 2016, a move that did not go down well with NR Narayana Murthy and Mohandas Pai. Infosys founder Murthy wrote to the board expressing his concerns about Sikka’s pay rise. He has been at the forefront in criticising the board over unusual rise in top executives’ salaries.
In a letter to the Infosys board, Murthy said that giving nearly 60 per cent to 70 per cent increase in compensation for a top-level person when the compensation for most of the employees in the company was increased by just 6 per cent to 8 per cent was not proper.
“This is grossly unfair to the majority of the Infosys employees including project managers, delivery managers, analysts, programmers, salespeople in the field, entry level engineers, clerks and office boys who are toiling hard to make the company better. The impact of such a decision will likely erode the trust and faith of the employees in the management and the board,” he had said. This letter came against the backdrop of proposed 35 per cent hike in COO Pravin Rao’s annual pay.
Murthy wasn’t alone in raising salary hike issue. Earlier, former board member V Balakrishnan had also asked the board that why pay obnoxious salaries to top management. In an interview to Economic Times, Balakrishnan said that it wasn’t appropriate for the top executives to ask their subordinates to compromise and take 40-50 per cent salary hike for themselves.