Salaries rise for promoters of auto firms even as business faces headwinds

Experts suggest that promoter executives should take compensation as dividend to share risk and reward of the business with other shareholders

Despite a forgettable year for the automobile industry, promoters, who act as top executives in their companies, gave themselves a healthy raise in FY21.

The promoter-executives took home a fatter paycheque despite their companies’ fortunes dwindling due to the impact of the Coronavirus (Covid-19) pandemic which also led to lower growth or stagnant salaries of other employees.

In FY21, the automobile industry saw significant disruptions triggered by Covid-19 which restricted production and customer movement. Despite resumption of business, vehicle sales are facing challenges due to rampant job losses and increase in raw material cost.

Last week, institutional shareholders of Eicher