Top Indian executives are expected to see their salaries increase by a 'modest' 9.4 per cent this fiscal as corporates continue to grapple with economic slowdown, says global consultancy Hay Group.
The projected average hike in compensation is much lower than the double-digit increase—around 11 per cent—seen in the previous year.
"The compensation of CEO's and their (companies) is said to increase by a modest 9 per cent and 9.4 per cent, respectively, in the current financial year," Hay Group India rewards practice leader Shridhar Ganesan said.
In the next fiscal (2013-14), the compensation of Indian CEO's and top executives is projected to be around 8.9 per cent and 9 per cent, respectively, he said.
"The economic turbulence is having a cascading effect on executive compensation," Ganesan said.
The findings are part of the 'Top Executive Compensation Report', released today, that covered 158 organisations operating in India. The salary trend are for Indian and non-promoter CEO's.
Incentives—both short-term and long-term—make up for 30-44 per cent of the overall executive compensation mix. According to Hay Group, there is a trend of increase in external recruitment of CEO's in evolving sectors such as retail and basic resources.
"Impatience for business results has led to recruitment of ready-made CEO's and is one of the reasons for variance in the compensation multiplier across sectors," Ganesan said.
"Market, strategy, culture and ambition are the four real drivers of modern days’ executive compensation," he added.