My take on this is something different. Once a guy reaches the position of CEO, he always run the risk of getting fired, if the business goes downhill, even if he is not solely responsible; factors could be market driven or economic downturn and so on. Hence the risk element being very high, he has to be compensated during the time he is at the helm of affairs and running the show successfully. Whereas with ordinary mortals or employees the matter is different. Whether the business goes uphill or downhill, so long as you perform your stability is assured except in rarest of rare cases like that of Mr. Phanish Murthy ! It is like Bollywood actors getting Rs.5 crore and Rs.10 crore for a movie lasting two hours and their appearance may be restricted to just 1 hour and 30 minutes or so. Over a period of time, they run the risk of not getting any roles and all those old actors may not be getting even Daddy roles or minor roles, unlike Big B ! They fade slowly and surely and unless they have money in hand, what they earned during their prime, it will be difficult for them to maintain a lifestyle befitting an actor of the past. Hence, wherever the risk factors are very high, the compensation will also be comparatively high ! This is similar to sports personalities. Beyond 40 years they are into oblivion and what they earn honestly ofcourse has to be kept away for a rainy day ! I know many professionals may not agree with my opinion, but this is MY opinion !
From India
581From India
Dear NK Sundaram
When the business goes DOWNHILL..... the first affected are the ORDINARY EMPLOYEES !!!!
They are AXED first in the name of Downsizing and attempts to make the company lean and competitive. Before that they have to go through bad patches of non-payment of over-due salaries and salary-reductions.
I have read reports of Kingfisher Airlines employees not getting salaries for months together; but yet to read any reports about the CEO's and senior executive facing hardships.
Your ARGUMENT is EXACTLY what paves the way for giving Obscene Salary Hikes to CEOs !!!
What is so special if the Industry as a whole performs at 11% and a company performs at 14% - just 3 percentage points higher. The average of 11 itself signifies that many more companies must have performed on a higher side too, to average out several low performing companies.
Warm regards.
From India, Delhi
When the business goes DOWNHILL..... the first affected are the ORDINARY EMPLOYEES !!!!
They are AXED first in the name of Downsizing and attempts to make the company lean and competitive. Before that they have to go through bad patches of non-payment of over-due salaries and salary-reductions.
I have read reports of Kingfisher Airlines employees not getting salaries for months together; but yet to read any reports about the CEO's and senior executive facing hardships.
Your ARGUMENT is EXACTLY what paves the way for giving Obscene Salary Hikes to CEOs !!!
What is so special if the Industry as a whole performs at 11% and a company performs at 14% - just 3 percentage points higher. The average of 11 itself signifies that many more companies must have performed on a higher side too, to average out several low performing companies.
Warm regards.
From India, Delhi
In my opinion all such stuffs are related to the marketing strategy of the company.
I would think "zillions" time before thinking of hiking the salary by 50%.Well, It's tough but not impossible. And when we come to the CEO of such top companies, I guess they deserve it. :)
From India, Noida
I would think "zillions" time before thinking of hiking the salary by 50%.Well, It's tough but not impossible. And when we come to the CEO of such top companies, I guess they deserve it. :)
From India, Noida
Hello PremOutshine,
I think you missed the WHOLE point.
The issue is NOT whether the CEO deserved the 50% hike or not--it's whether the same/similar treatment was given to the rest of the employees.
Rgds,
TS
From India, Hyderabad
I think you missed the WHOLE point.
The issue is NOT whether the CEO deserved the 50% hike or not--it's whether the same/similar treatment was given to the rest of the employees.
Rgds,
TS
From India, Hyderabad
I second Sateesh, I raised this question to our Think Tanks, because I found it very strange.
A simple google search will show similar announcements for the CEO's salary, across the world and there by the news about the share price catapult and business growth.
What does such an action stand for beyond the hogwash and PR effort?
I am grateful to the in-depth understanding shared and insights on the Indian Business scenario.
From India, Mumbai
A simple google search will show similar announcements for the CEO's salary, across the world and there by the news about the share price catapult and business growth.
What does such an action stand for beyond the hogwash and PR effort?
I am grateful to the in-depth understanding shared and insights on the Indian Business scenario.
From India, Mumbai
Dear friends,
This is for those interested to know little more about the progress of emerging countries.
Chart of the day (Pl.see the attachment)
"There is no doubt that GDP growth both in India and China has considerably slowed down. In India, growth in FY13 was the lowest in a decade. But when compared to their peers in both the developed and the emerging world, they have still done better. Indeed, as today's chart shows, China and India lead the pack with respect to growth in the March 2013 quarter. Having said that, overall this still does not bode well for the global economy. Growth in the developed world still remains weak and it will be a while before there is a recovery. It was hoped that healthy growth in the emerging economies would rebalance overall global growth. But judging by the performance in these countries, that alas does not seem to be the case. "
Data Source: The Economist
From India, Bangalore
This is for those interested to know little more about the progress of emerging countries.
Chart of the day (Pl.see the attachment)
"There is no doubt that GDP growth both in India and China has considerably slowed down. In India, growth in FY13 was the lowest in a decade. But when compared to their peers in both the developed and the emerging world, they have still done better. Indeed, as today's chart shows, China and India lead the pack with respect to growth in the March 2013 quarter. Having said that, overall this still does not bode well for the global economy. Growth in the developed world still remains weak and it will be a while before there is a recovery. It was hoped that healthy growth in the emerging economies would rebalance overall global growth. But judging by the performance in these countries, that alas does not seem to be the case. "
Data Source: The Economist
From India, Bangalore
Thanks for the article. Please see below an extract from your article, which clearly states that India needs to address its policies.
In a landmark decision, the Indian government had approved FDI in retail. But foreign investors do not appear to be too keen to speed up their investments in the country. Crisil has stated in a report that it does not expect foreign retailers to make any big ticket investments for at least 2 to 3 years. The reason for this is the rules laid down for FDI. Retailers have to make greenfield investments of at least US$ 100 m as a condition for entry into India. Given the depressed macroeconomic scenario, most companies are curbing or cutting back on their investment plans. Therefore making such an investment right away may not be too feasible. Moreover India itself is battling its own issues like political uncertainty, slowing economic growth, etc. In such circumstances, investors are expected to be skeptical about parking their funds in the country. This is something we have been writing about since the FDI policy was approved. India has to effectively deal with its policies and reform them to make the investment environment conducive. Otherwise simply approving FDI would not really help.
From Indonesia, Jakarta
In a landmark decision, the Indian government had approved FDI in retail. But foreign investors do not appear to be too keen to speed up their investments in the country. Crisil has stated in a report that it does not expect foreign retailers to make any big ticket investments for at least 2 to 3 years. The reason for this is the rules laid down for FDI. Retailers have to make greenfield investments of at least US$ 100 m as a condition for entry into India. Given the depressed macroeconomic scenario, most companies are curbing or cutting back on their investment plans. Therefore making such an investment right away may not be too feasible. Moreover India itself is battling its own issues like political uncertainty, slowing economic growth, etc. In such circumstances, investors are expected to be skeptical about parking their funds in the country. This is something we have been writing about since the FDI policy was approved. India has to effectively deal with its policies and reform them to make the investment environment conducive. Otherwise simply approving FDI would not really help.
From Indonesia, Jakarta
And my question is that, is it fair to compare the CEO with the rest of the employees in an organization?
From India, Noida
From India, Noida
Hello PremOutshine,
I am not sure of your 'definition' of comparision.
I don't think this an issue of comparision--it's one of EQUAL treatment within the Organization.
Would the CEO [or for that matter any higher official] be able to do anything on his/her own without the support/effort of those down-the-line?
Equally well, those down-the-line would ALSO NOT be able to do much without the guidance/support of the higher-ups.
Like the American slang Saying goes: 'It takes two to tango'. So it INVARIABLY IS & WILL ALWAYS BE a Collective effort for ANY Organization. Each will have to give his/her Best, relative to his/her role & responsibilities--that's when the Organization, as a whole, thrives & grows.
Rgds,
TS
From India, Hyderabad
I am not sure of your 'definition' of comparision.
I don't think this an issue of comparision--it's one of EQUAL treatment within the Organization.
Would the CEO [or for that matter any higher official] be able to do anything on his/her own without the support/effort of those down-the-line?
Equally well, those down-the-line would ALSO NOT be able to do much without the guidance/support of the higher-ups.
Like the American slang Saying goes: 'It takes two to tango'. So it INVARIABLY IS & WILL ALWAYS BE a Collective effort for ANY Organization. Each will have to give his/her Best, relative to his/her role & responsibilities--that's when the Organization, as a whole, thrives & grows.
Rgds,
TS
From India, Hyderabad
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Salary-Note.doc
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