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Mukesh Ambani caps own pay at Rs 15 crore; others gets hike
Reliance Industries chief Mukesh Ambani has capped his salary for the second straight year at Rs 15 crore (Rs 150 million), less than half of what he is eligible to draw, while rest of the RIL top brass got a pay hike in FY'10.
"The chairman and managing director's compensation has been set at Rs 15 crore as against Rs 39.36 crore (Rs 393.6 million) that he is eligible as per the shareholders' approval, reflecting his desire to set a personal example for moderation in managerial compensation levels," RIL has told its shareholders on Tuesday.
The remuneration for 2009-10 fiscal to Mukesh Ambani, the country's richest person with a net worth of $29 billion and fourth wealthiest in the world as per Forbes magazine, is still higher than any other director of Reliance Industries.
But, all the existing executive directors of the company saw their pay packages increase from the levels in 2008-09, as per the latest annual report to the shareholders.
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Mukesh Ambani caps own pay at Rs 15 crore; others gets hike
PMS Prasad, who played a crucial role in RIL's legal battle with Anil Ambani group and became executive director in August last year, saw his remuneration rise to Rs 1.53 crore (Rs 15.3 million).
The company's total managerial remuneration rose to Rs 40.90 crore (Rs 409 million) in 2009-10, from Rs 38.21 crore, while commission paid to non-executive directors fell from Rs 1.89 crore (Rs 18.9 million) to Rs 1.75 crore (Rs 17.5 million).
The payment to key management personnel included Rs 15 crore to Mukesh, unchanged from Rs 15 crore in previous year, Rs 11.14 crore (Rs 111.4 million) each to Nikhil Meswani and Hital R Meswani (up from Rs 10.93 crore (Rs 109.3 million) to each of them in 2008-09).
The remuneration paid to H S Kohli declined from Rs 1.35 crore (Rs 13.5 million) to Rs 1.32 crore (Rs 13.2 million), but he is no more associated with the company and resigned on May 16, 2010. The remuneration rose from nil to Rs 77 lakh (Rs 7.7 million) to another former director R Ravimohan, who passed away on December 28, 2009.
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Mukesh Ambani caps own pay at Rs 15 crore; others gets hike
The company has appointed Pawan Kumar Kapil as an additional director, following Kohli's resignation, with Rs 50 lakh (Rs 5 million) as salary and Rs 75 lakh (Rs 7.5 million) towards perquisites and allowances per annum.
At a time when there was a raging debate on right-sizing of CEO salaries, RIL announced in October last year that Mukesh Ambani would take a pay cut as a result of which his pay package dropped to Rs 15 crore for 2008-09 fiscal from over Rs 44 crore in 2007-08. Mukesh Ambani was the top-paid executive in India during 2007-08.
Days before Ambani's decision, Corporate Affairs Minister Salman Khurshid had advised the industry to shun 'vulgar' salaries and Planning Commission Deputy Chairman Montek Singh Ahluwalia had also agreed that there should be no 'indecent' compensation.
At that time, the company had also decided to adopt the capped structure method of deciding executive compensation in RIL, instead of pegging it as a percentage of net profit.
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Mukesh Ambani caps own pay at Rs 15 crore; others gets hike
As per RIL's latest annual report, the company paid higher amounts to its key managerial personnel in terms of salaries, perquisites and allowances, provident and superannuation fund contributions and gratuity provisions, but cut down heavily on commission payments.
The company paid total managerial salaries of Rs 7.42 crore (Rs 74.2 million) in 2009-10, up from Rs 1.34 crore (Rs 13.4 million0 in previous year, perquisites and allowances of Rs 5.57 crore (Rs 55.7 million0 -- up from Rs 1.66 crore (Rs 16.6 million), commissions of Rs 19.94 crore (Rs 199.4 million) -- down from Rs 34.23 crore (Rs 342.3 million).
Towards leave salary/encashments, RIL paid Rs 55 lakh (Rs 5.5 million) -- unchanged, contribution to provident fund and superannuation fund of Rs 1.06 crore (Rs 10.6 million) -- up from Rs 36 lakh (Rs 3.6 million) and gratuity provision of Rs 6.36 crore (Rs 63.6 million -- up from Rs 7 lakh (Rs 700,000).
Mukesh's pay included Rs 4.16 crore (Rs 41.6 million) as salary, Rs 60 lakh (Rs 6 million) as perquisites and allowances, Rs 5.60 crore (Rs 56 million) of retrial benefits and Rs 4.64 crore (Rs 46.4 million) as commission.