Infosys CEO Shibulal takes 27% salary cut

Infosys CEO Shibulal takes 27% salary cut

IT giant Infosys' Chief Executive Officer S D Shibulal took a 26.51 per cent cut in salary for the fiscal ended March 31, 2013, according to a recent regulatory filing with the SEC.

Shibulal's annual compensation for fiscal 2013 stood at $119,774, a significant cut from $162,990 he received in fiscal 2012 primarily due to a cut in bonus/incentive pay.

Executive salary at Infosys broadly consists of four components, salary, bonus/incentive, other annual compensation and amount accrued for long term benefits.

Whereas Shibulal received $53,326 bonus in 2012, in 2013, the amount received in this category declined 70.14 per cent to $15,918.

“This is more of a salary rationalisation than a cut. With the number of deals and deal sizes decreasing, companies are looking at rationalising compensation of executives that had soared in the past few years,” Director at recruiting firm Global Hunt, Sunil Goel said.

Infosys, last month, reported net profit of Rs 2,394 crore for the quarter ended March 31, 2013, a meagre growth of 3.4 per cent from Rs 2,316 crore for the quarter ended March 31, 2012, owing to 0.7 per cent fall in pricing in the quarter.

Shibulal's compensation in the salary component fell 5.27 per cent to $66,311 in the fiscal ended March 31, 2013.

Infosys has a variable compensation structure for all of employees. Each employee’s compensation consists of performance incentives payable upon the achievement by the company of certain financial performance targets and is also based on individual performance.

“Our Board aligned the compensation structure of our employee directors in line with that applicable to all of our other employees. All of our executive directors are entitled to a bonus of up to 20 per cent of their fixed salary. All of our executive directors are entitled to receive company-linked performance incentives payable on our achievement of certain financial performance targets,” Infosys said in its filing.

The company added that all their executive directors are entitled to receive individual performance-linked incentives and the bonus and various incentives are payable quarterly or at other intervals as may be decided by the Board.

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