That Debnarayan “Debu” Bhattacharya is passionate about metals is quite obvious. What else do you expect the managing director of Hindalco and vice-chairman of Novelis Inc, the world’s largest aluminium rolling company, to be? But only those who know him well are aware that he habitually spends the first half of Sunday at office before taking his family out for a lunch or movie.
His colleagues are aware of his meticulous focus on details that is almost professional. Across India Inc, Bhattacharya and his team are known for massive projects and the now legendary turnaround of Novelis.
For many, it’s hardly surprising that Bhattacharya is the highest paid professional CEO across corporate boardrooms in India, having an annual compensation of Rs 17.31 crore in 2011. (Going Through the Roof)
But let’s put that in context: The 12 names ahead of him are all promoters of companies and conglomerates from seven of the Indian blue chips.
Sun TV Network chairman and managing director Kalanithi Maran and joint managing director Kavery Kalanithi, also the promoters of the biggest entertainment channel in south India, failed to defend their title of highest paid promoter CEOs, despite receiving an annual compensation of Rs 64.40 crore each, a rise of 73 per cent over 2010.
The Marans were pipped by Naveen Jindal, chairman and managing director of Jindal Steel, who retained his top position for two years now, with a remuneration of Rs 67.21 crore, though the former received 14 per cent share of the net profit, or Rs 53.54 crore each, as ex-gratia or bonus.
But moving beyond the individual to the collective, the number of executive directors earning annual remuneration of more than Rs 1 crore swelled to 674 in 2011, from 583 in 2010. In the last five years, the number has gone up sharply from 393 in 2007. The sample is based on listed companies part of the Bombay Stock Exchange and National Stock Exchange 500 Index, but excludes public sector undertakings.
Together, these crorepati CEOs took home Rs 2,500 crore, accounting for 1.53 per cent of the net profit earned in 2011. These CEOs received 39 per cent of their annual compensation as salary, 41 per cent via commission or share in profit, nine per cent in the form of perquisite and 11 per cent performance bonus and others.
The 318 promoter-CEOs in the list shared Rs 1,510 crore, while the 364 best-paid executives collectively received Rs 1,000 crore. Interestingly, the number of CEOs or executive directors getting annual remuneration of more than Rs 10 crore each, swelled to 41, from 34 in 2010, and more than doubled, compared to 18 in 2007.
While the number of CEOs getting an annual compensation of over Rs 50 crore each increased to three from one, the number of executives or promoters getting pay packet between Rs 5 crore and Rs 9.99 crore went up to 79, from 68 in 2010 and 40 in 2007. Despite this, the aggregate remuneration increased by 10.41 per cent in 2011, a slower pace compared to a 19.4 per cent rise in net profit.
The group impact was beneficial too, as having many profit-making companies within a conglomerate proved to be a boon for many promoters. For example, Aditya Birla Group chairman Kumar Mangalam Birla received Rs 38.11 crore worth compensation as share in profit from four listed companies. Similarly, Ratan Tata was compensated Rs 6.95 crore for holding chairman’s position in three group companies — Tata Motors, Tata Steel and Tata Consultancy Services.
Reliance Industries chairman Mukesh Ambani, who ranked 15 in the list, has not increased his compensation in the last three years. He took home Rs 15 crore in each of the last three years. Similarly, his brother, Anil Ambani, took home Rs 11.11 crore in each of the last three years.
