ITC CMD Sanjiv Puri's pay increases 47% to Rs 11.95 crore in FY21

Full-year impact of his revised pay structure comes into effect

The annual remuneration of ITC Chairman and Managing Director, Sanjiv Puri, rose 47 per cent in FY21, as the full-year impact of his revised pay structure came into effect.

Puri’s gross remuneration for the year ending March 31, 2021, stood at Rs 11.95 crore, which includes basic consolidated salary of Rs 2.64 crore, performance bonus and long-term incentives/commission of Rs 6.98 crore and other perquisites. Much of the increase was on account of performance bonus and long term incentives. 

In FY20, his gross remuneration was at Rs 7.6 crore (the figure does not include contribution to approved pension funds). Puri’s remuneration was approved by shareholders in September 2019 and was effective October 2019. The FY20 remuneration had considered the increased pay only in part.

In 2019, ITC changed the remuneration structure of its key management personnel after its single largest shareholder, British American Tobacco (BAT), decided not to support the company’s proposal to continue with the equity-linked Employee Stock Option Scheme (ESOP) in 2018, on grounds of stake dilution.

Historically, ITC used a mix of remuneration and the equity-linked ESOP scheme for retaining and attracting talent. The company's Nomination and Compensation Committee then restructured the compensation of key managerial personnel, including the chairman and managing director and whole-time directors, which was approved by shareholders through postal ballot on September 23, 2019.

As per the terms of the resolution, the annual value of long term incentives for Puri was not to exceed 0.10 per cent of the net profits of the company for the immediately preceding financial year. While recommending the remuneration of Puri, the committee also took into consideration the enlarged role of chairman of the company with effect from May 13, 2019.

In FY20, the company’s profit after tax had grown by 21.4 per cent to Rs 15,136.05 crore on the back of a reduction in corporate income tax rates during the year.

In FY21, revenues and profits were impacted by the Covid-19 pandemic in the fourth quarter; gross revenue at Rs 48,151.24 crore increased by 3.9 per cent, while profit before tax (before exceptional items) at Rs 17,164.15 crore dropped by 11.1 per cent over the previous year while profit after tax stood at Rs 13,031.64 crore.