First Time In 152 Years: 20% Salary Cut For Tata Group Top Management Due To #Coronavirus
Coronavirus is triggering unprecedented changes in the corporate structures, across the world. And even Tata Group cannot stay aloof for long.
For the first time in their 152 years history, the top management at Tata Group will take 20% salary cut.
Tata Group Top Brass Will Take 20% Salary Cut
For the first time ever, Chairman of Tata Sons, and all CEOs of their holding companies will take a salary cut, and this is happening due to the economic impact of coronavirus.
Tata Sons is now looking at extreme measures to cut costs, and this decision to take 20% salary cut will be rolled out for CEOs and MDs at Tata Steel, Tata Motors, Tata Power, Trent, Tata International, Tata Capital and Voltas and other holding companies.
An unnamed CEO from a Tata Sons company said: “These are times never before experienced in the history of our group and it calls for some tough measures to protect businesses. We will do all that it takes to ensure right leadership with empathy. As a culture, the group has always ensured employees down the line are protected as much as can be.”
Salaries Of All CEOs, Chairman Of Tata Sons Will Be Deducted
If we talk about the top 15 CEOs within Tata Group, then their salaries increased by about 11% average in FY2019, compared to 2018.
This increase was 14% in 2018, compared to FY2017.
Of the 33 listed companies under Tata Group, the overall sales increased to Rs7.52 lakh crore in 2019, which is an increase of 10%.
Tata Steel, Tata Motors and TCS accounted for 82% of the total sales. However, the overall profit of the 33 listed companies under Tata Group fell by 20% in 2019, compared to 2018.
While TCS gave profits of Rs 32,340 crore in FY2019, Tata Steel contributed Rs 10,218 crore.
We have already reported that TCS top management is taking a pay cut to combat coronavirus impact: TCS chief executive Rajesh Gopinathan’s salary has anyways dropped to Rs 13.3 crore, which is a reduction of 16.5%, as on the year ending March 31, 2020.
This salary has been further reduced in 2020.
TCS in their annual report said, “The executive remuneration for FY20 is lower than FY19 in view of the economic conditions impacted by the Covid-19 pandemic”
Highest paid CEO in Tata Group is Tata Motors CEO Guenter Butschek, whose salary was Rs 26.29 crore, which is 351 times more of an average salary in Tata group companies.
Interestingly, Tata Sons chairman N Chandrasekaran received salary of Rs 65.52 crore for FY19, which also includes a Rs 54 crore commission on the profit of Tata Sons
We will keep you updated, as more details come in.