According to the 2022 Deloitte India Executive Remuneration Survey, the average pay package for chief executives (CEO) of large companies in India reached Rs 11.2 crore with median remuneration at Rs 7. 4 crores.
- In FY21, the average CEO compensation was Rs 9.4 crore (Rs 6.4 crore median).
- In FY20, the average pay package stood at Rs 9. 8 crores (Rs 6.9 crore median).
- For professional CEOs, the average pay package stood at Rs 10 crore, with a median of Rs 7. 4 crores.
On average, more than half of the total compensation for CEOs is variable. The survey shows that the salary is the highest in the past three years.
Anubhav Gupta, partner, Deloitte said, “Limited and highly sought-after talent pool, the talent that is highly fungible within and even across sectors, and continued gap to global pay levels contribute to the increase in executive pay. At the same time, boards, promoters, and shareholders are focusing on linking a larger part of the pay to performance.”
In FY22, the survey showed that the average pay package for the CEOs in terms of the total cost to the company including long-term incentives:
- 2.7 times that of chief financial officers
- 3.7 times that of business unit heads
- 4.1 times that of chief human resource officers and heads of sales
The remuneration survey demonstrates that chief operating officer (COO) positions seemed closest to the CEO position; the average pay package of the CEOs was 2.4 times that of COOs.
CXOs’ compensation has stayed largely stable through the last three years, with almost 40 percent of total pay being at risk. For CEOs, nearly 84 percent of short-term incentives (STIs) are linked with company performance. The corresponding number is about 50 percent at the CXO level. Almost 80 percent of organizations prefer a target-based approach for determining short-term sops.
Gupta said, “The most dominant LTI instrument is stock options as 54 percent of companies use it, the adoption of performance shares has been gaining traction over the last few years with 16 percent of the companies handing out these.”
The survey covered more than 470 entities from various sectors, including manufacturing, consumer products, IT, ITeS, and financial services sectors, took into account the pay package for both promoter CEOs as well as professional CEOs, and included long-term incentives (LTIs).
