The Hush Post: A PR stunt gone wrong. As Reliance Industries’ (RIL) released its annual report, among other things which was highlighted, was the fact that the Chairman and Managing Director Mukesh Ambani hasn’t had a salary hike for the last 10 years.
But how much does he get annually was a bigger question everybody wanted to know? “(Annual) Compensation of Mukesh Ambani has been set at Rs 150 million. It reflects his desire to continue to set a personal example for moderation in managerial compensation levels,” the company said in its latest annual report, for 2017-2018.
Ambani’s pay comprises Rs 44.9 million as salary and allowances, Rs 2.7 million as perquisites, Rs 7.1 million as retiral benefits and another Rs 95.3 million as commission payable, as per the details in the annual report. There are no stock options.
Even Nita Ambani, the chairman’s wife, who is a non-executive and non-independent director on the board, also saw her compensation go up. For 2016-17, she got a compensation of Rs 13.9 million, inclusive of sitting fee and commission, which went up to Rs 15.6 million in 2017-18.
RIL’s other executives, however, saw their salary rise compared to the financial year 2016-17.
Salaries and perquisites for P M S Prasad rose to Rs 89.9 million from the earlier Rs 78.7 million. The total payable to executive directors Nikhil Meswani and Hital Meswani also saw a significant jump to Rs 199.9 million, from the earlier Rs 165.8 million, each.
Four of the company’s whole time directors last year received stock options. However, for 2017-18, none of the whole time directors was given any, says the annual report.
In his letter to shareholders, Ambani said, “FY2017-18 turned out to be a watershed year in the history of Reliance.”
On his consumer goods business: “Our aim is to have the consumer businesses contribute on par with the energy and materials business over the next decade when we celebrate our Golden Jubilee.”
The company also looks to raise up to Rs 200 billion through non-convertible debentures (NCD)s in the current financial year and will seek shareholders approval for the same at its upcoming annual general meeting (AGM).
Earning or a white collar loot?
Former Prime Minister Manmohan Singh had appealed to private companies and their owners and CEO to be less ruthless with pay hike to those running the show mainly businessman. Reason, it wasn’t commensurate with their work but with profit, which mostly is earned by using dirty business tricks.
Most of the Reliance Directors like Nikhil Meswani or Mukesh Ambani himself earn more than what 50 Chief Justices of India or 50 Army Chiefs have earned separately per year.