The Deloitte report reveals that the average CEO compensation in India has surged by 40% compared to pre-COVID-19 levels, reaching Rs 13.8 crore. Promoter CEOs or those affiliated with promoter families receive even higher compensation, averaging at Rs 16.7 crore. Anandorup Ghose, Partner at Deloitte India, attributes this trend to the longer tenure of promoter CEOs and the wide range of compensation within this group.
Over half of the CEO compensation is tied to short-term and long-term incentives, with a significant portion considered ‘pay-at-risk’. Professional CEOs face higher risk, with 57% of their compensation being ‘pay-at-risk’, compared to 47% for promoter CEOs. Additionally, long-term incentives for CEOs mainly consist of share-linked incentives, with a growing shift towards Performance Shares over stock options.
The study also highlights changes in CEO dynamics, with 45% of BSE 200 companies witnessing CEO changes in the past five years. Notably, 60% of new CEOs are internally appointed, while the rest are external hires. The survey, conducted among over 400 organizations, reflects a shift towards globally aligned compensation practices, emphasizing the need for effective incentive structures aligned with stakeholder returns.
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