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Govt frowns upon fancy CEO salaries, preaches austerity

India Inc should refrain from granting itself exorbitant pay packages, said Salman Khurshid, the Union Minister for Corporate Affairs. The minister added that while the government would not dictate salaries, it would, however, issue guidelines in this regard.
“We are accountable to the people and therefore we are doing this beyond the rules,” Khurshid said.
“It would be paternalistic [for the government] to tell the shareholder what’s good for the company. However, the shareholder must have information, we will educate the shareholders whether there should be some upper limit [to the executives’ salaries] etc. It’s something that the standing committee is examining,” he said.
Two third of the 100 Chief Executive Officers (CEOs) polled in an associated chamber of commerce and industry of India (ASSOCHAM) survey, turned down Corporate Affairs Minister Salman Khurshid's suggestion that corporate salaries need to be capped. They said that
Salman Khurshid' suggestion on corporate austerity has been turned down by corporate
Ashok Soota, CEO of Mind Tree Technologies said that he doesn’t know about other companies but the compensation is governed by the corporate law.
Management salaries are already governed by corporate law. A company's top management cannot earn more than 10% of total profits. An amendment to the company's act will also give shareholders a say in deciding executive salaries. The amended act, tabled in August this year, is currently before a standing committee of Parliament. The Minister for Corporate Affairs has already indicated that he would like CEO salary thresholds to be at lower levels.
Anand Sharma, Commerce Minister is of the view that the reference was to indecent salaries. He said that these are austere times and corporate


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