Davos: IT czar Azim Premji has said his son Rishad will never be the Chief Executive of his company Wipro, but will represent promoter ownership on the company's board.
Rishad, 35, joined Wipro in 2007 as Business Head for Special Projects in the banking and financial services vertical and rose to become Chief Strategy Officer three years later. Premji, who founded Wipro, said becoming CEO was not the career path for the eldest of his two sons.
"He (Rishad) is not going to be the chief executive officer, that's not the career plan for him but, he would be representing ownership obviously," Premji, Chairman of Wipro, said in television interviews on sidelines of World Economic Forum here.
Azim Premji directly owns 3.7 percent in the company, while entities related to him own over another 74 percent. Rishad has a direct ownership of 0.03 percent shares in Wipro. Rishad has for long been speculated to be a natural choice for taking over the company's operations.
Prior to joining Wipro, Rishad, a management graduate from Harvard Business School, worked with Bain & Co, working across segments like consumer products, automobiles, telecom and insurance. There have been speculations of him being appointed as the CEO of the now demerged entity of Wipro, which will include the non-IT business.
The non-IT businesses of Wipro, which includes lighting, furniture, consumer care products and infrastructure engineering services, was hived off last year to focus on the core information technology business. It contributes about 10 per cent of the company's revenues.
There have also been discussions around succession plans at Wipro after the retirement of Azim Premji, who is 67 now.
On taxing the rich
Amidst the debate on taxing the super rich, Azim Premji said it is a "politically" correct thing to do, but expressed doubts whether the government will actually implement the proposal.
"It sounds like a right thing to do politically, but I do not actually know if it will come up (in the next Budget)," he said.
Asked if he is in favour of rejigging tax slabs, he said: "It depends on what rate do they start, but in terms of the super-rich, I think there is a legitimacy in a country as poor as ours". Several experts including chairman of Prime Minister's Economic Advisory Council (PMEAC) C Rangarajan have underlined the need for imposing higher rates of taxes on super rich.
India taxes income at three rates - 10 percent, 20 percent and 30 percent. These rates were fixed in 1997. Finance Minister P Chidambaram will have to take a call on the issue of levying higher tax rate on super rich in his budget proposals to be presented in the Lok Sabha on February 28.
The Minister, however, in his recent meetings with investors in Hong Kong and Singapore had indicated that he might not increase the tax rates but would focus on compliance to increase revenue. Chidambaram had last year called for a debate on the need to impose inheritance tax in India saying that enough attention had not been paid on accumulation of wealth in the hands of a few.
Earlier in the month, Rangarajan pitched for higher taxes on super rich, saying that the forthcoming budget could look at imposing surcharge on income above a threshold. Talks of taxing the super rich has been gaining grounds after the US Congress this month voted for raising taxes on rich Americans, as part of resolutions of crisis over the so-called fiscal cliff.
The US legislation proposes to hike tax rates on individual earning more than $400,000 per year, and on
couple earning more than $450,000. Speaking to another television channel, Premji said it should be left to the Reserve Bank to decide on who should enter the banking space.
"There can be a non-corporate who can get into banking. But it is not clear who will be issued the new bank licenses," he said when asked whether the corporates should be allowed to set up banks. RBI is in the process of finalising the guidelines for issuing new bank licences.
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