Infosys CEO Vishal Sikka’s remuneration for FY17 dropped by 67% when compared to FY16, as far as the cash component of his package is concerned. His salary was largely impacted by a 70% drop in bonus payout. However, his total compensation, which includes stock grants and retiral benefits, dropped only by 7% during the same period, according to the company’s latest annual report. Sikka’s remuneration for FY17 stood at Rs16.01 crore as compared to Rs48.73 crore in FY16. This remuneration primarily includes the cash part of the compensation which is the base salary, bonus payment and other benefits accrued from the sale of shares.
However, the total compensation of Sikka which also includes grant of stock units and retiral benefits for FY17 stood at R45.11 crore as compared to Rs48.41 crore in FY16. The Infosys CEO received a base salary of $1 million while the variable payout was $0.82 million as against the target of $3 million. During FY17, Sikka received restricted stock units worth $2 million and performance based stock incentives of $2.88 million.The remuneration of Sikka for FY17 remains 283.07 times higher than the median remuneration of employees (MRE) of Infosys. The MRE of Infosys for FY17 stood at Rs5,65,585.
The compensation paid to the Infosys CEO had become a sore point for the company’s founder N R Narayana Murthy, who had questioned the principles on which the Board was paying a high salary to Sikka. In fact, Sikka’s total compensation has increased from $7 million to a maximum of $11 million to become one of the highest paid executives in the Indian IT industry. The drop in Sikka’s compensation is also a reflection on the growth rate exhibited by Infosys. The company closed FY17 with a dollar revenue growth of 7.4% while it has provided a guidance of 6.5-8.5% for FY18.
In line with the dip in Sikka’s remuneration, the other key executives of Infosys have also seen a similar fall. Chief operating officer UB Pravin Rao’s remuneration for FY17 stood at R7.80 crore as compared to R9.28 crore in FY16 showing a fall of 16%. The other key management personnel of Infosys like M D Ranganath, Ravi Kumar, Mohit Joshi, Sandeep Dadlani, Rajesh K Murthy have also witnessed a significant drop in remuneration largely due to the fall in the payment of bonuses.