Salman Khurshid and Montek Singh Aluwahlia's apprehension about CEO salaries Salman khurshid brought
out the issue of CEO salaries in the private sectors as vulgar, which really does not have any merit. Then, the deputy chairperson of the Planning Commission, Montek Singh Aluwahlia too joined Khurshid, why he knows better. If I were asked to make any comment on this, I would say, both Khurshid and Montek are jealous about the corporate chief executives.
The ministers and member of the parliaments spend quite more than the CEOs and that too the taxpayer’s money. Salary should not be taken in isolation, when the point of expenses on one person is discussed. Moreover, the CEOs of India are not earning any amount as salary outside the guidelines of the government that are de facto restrictions linked with the net profits of the company. The highest paid CEO in India is Mukesh Ambani, the Chairman of the Reliance Industries. What he gets as salary is just 0.29% of the net profit of the company, which could have been 5% as per the guidelines. Similar restraints are maintained by Sunil Mittal of Airtel, Kumar Mangalam Birla of Grashim, and others. In cases of Kumar Mangalam and Sunil, they have taken salary 0.56% and 0.32% of their company’s profit respectively. There is one or two stray cases where the CEOs have exceeded the gentle norm of 5%, but that cannot be questioned as the company, not taxpayer’s money, earns this money.
If really something is vulgar, it is the political leaders’ expenses in terms of perquisites. They are wasting exchequers’ money without any
accountability; CEOs take the responsibility to take the company in new heights, failing which they are to give the accountability to the appropriate place and many a times lose their position in the company. Does that happen to the ministers? The elected members and after becoming ministers they indulge all sorts of unnecessary spending on them, go through corrupt practices, accumulate huge sums of money in just one term, and then talk saintly. Had there been honest people in the parliament, India would have seen poverty and illiteracy even after 62 years of independence.
Recent news of how the ministers in their official visits to US stayed in five star hotels that costs the government more than Rs. 30,000 per night room tariff. Salman and Montek should raise these issues rather than CEO’s salaries, which the companies are capable of taken care of.