A data comparison of remuneration paid to key managerial personnel (KMP) and the median remuneration for 42 private companies in Nifty50 companies for 2019-20 has revealed a stark disparity in corporate salaries.

A Sebi rule requires publicly traded companies to disclose their top management’s remuneration with respect to other employees since 2015, a press note by economists Reetika Khera and Meghna Yadav points out. These disclosures are mandated under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

The numbers for 2019-20 showed that at a time when company after company executed pay cuts and fired employees during the Covid-ravaged months, there seemed to be little financial hardship for corporate India‘s top rungs.

The highest pay ratio is seen in Hero Motocorp at 1:752, where Pawan Munjal is the highest paid executive with an annual remuneration of Rs 84.6 crore. Maruti Suzuki has the lowest pay ratio at 1:39, with the highest paid executive Kenichi Ayukawa receiving annual remuneration of Rs 4.67 crore.

The economists added that there has been little change in the pay ratios over time: “If one compares the percentage increase in the remuneration of the top paid executive with the percentage increase in median remuneration, we find that out of 37 companies where data was available, the increase in median remuneration was lower for 15 companies and higher for 21 companies.”
There also exists a disparity in diversity among top corporate KMP. There is only one woman that features in this list – Vibha Padalkar in HDFC Life Insurance. “There do not appear to be any Dalits or STs, and there is (at least) one Muslim,” said Khera and Yadav.

As mentioned earlier, companies are now rule-bound to annually disclose this data which has over the years come to generate a lot of interest in media circles. As of now, Reliance is the only private Nifty50 company that does not report the pay ratio and has been dodging compliance with Rule5(1) since 2016-17, according to the economists.

Reliance’s annual report states: “The said information is available for inspection on all working days, during business hours, at the Registered Office of the Company. Any member interested in obtaining such information may write to the Company Secretary and the same will be furnished on request.”

*This story has been updated. In the original copy, JSW Steel had been erroneously stated to have the highest pay ratio.