Why has Wipro's Rishad Premji taken a 50 per cent pay cut

In the wake of poor net performance for FY23, Wipro’s executive chairman has opted to cut his handsome salary in half. According to a recent filing with the Securities and Exchange Commission in the US, Rishad Premji has voluntarily reduced his salary by 50 per cent for the fiscal year 2023. Along with this, he didn’t take any commission, nor did he avail himself of any stock grants this year. So how much he will be paid now? Let’s take a closer look. Also read: From Microsoft, Amazon, Google to Wipro, a look at major job cuts in January The pay cut This year, Rishad Premji earned Rs 7.87 crore in total annual income, about 50 per cent ($867,669 or Rs 7.18 crore) less than he did the year before. This package consists of $74,343 (Rs 61.53 lakh) in long-term compensation benefits, $15,390 (Rs 12.73 lakh) in other sources, and $861,620 (~Rs 7.13 crore) in salary and allowances, according to Wipro Limited’s Form 20-F, which was submitted to the US Securities and Exchange Commission. Usually, he would also be compensated with a commission at a rate of 0.35 per cent on Wipro Limited’s increased consolidated net profits over the prior fiscal year. This meant, as Executive Chairman of the Board, Premji received $1,819,022 (Rs 15.05 crore) in 2022. With profits dipping, the chairman let go of half his remuneration. He didn’t take any commission, nor did he avail himself of any stock grants this year. Earlier in the pandemic (FY20), Premji took a 31 per cent pay cut. The current five-year tenure of Rishad Premji as the organisation’s executive chairman will end on 30 July 2024. Prior to being elected to the board in May 2015, he had been with the business since 2007, serving in a number of capacities. These specifics were provided in Form 20-F submitted to the United States Securities and Exchange Commission by this IT company having its headquarters in Bangladesh. Also read: Infosys bans moonlighting, Wipro head calls it ‘cheating’: What’s this practice on the rise in the tech industry? Wipro’s salaries for executives The Nomination and Remuneration Committee approves the executive directors of Wipro’s yearly compensation. Executive officers and executive directors of the corporation receive fixed compensation as well as variable performance-linked incentives. Financial indicators like revenue, profit, operating margin, and other strategic goals are among the grounds for variable pay, according to Fortune. According to the outlet, the compensation of executive officers at Wipro is calculated on an accrual basis and includes the depreciation of restricted stock units (RSUs) that have been granted to them and that vest over time, as well as performance-based stock units (PSUs), which vest in accordance with the company’s performance metrics. The IT firm says its cost of revenues increased by 16.11 per cent, primarily because of an increase in employee compensation as a result of salary increases, including promotions, and an increase in headcount, including through acquisitions, as well as additional subcontracting costs incurred to fill open positions, an increase in travel expenses as a result of the relaxation of COVID-19-related travel restrictions, and an increase in software licence costs. “As a result of the foregoing factors, our gross profit as a percentage of our total revenue decreased by 100 basis points,” the company says. According to PTI, the corporation also disclosed last week the average variable compensation for its employees for the fourth quarter of FY23, which was 80.2 per cent. In the fourth quarter of FY23, the IT giant reported a consolidated net profit of Rs 3,074.5 crore, a modest decline from the profit of Rs 3,087.3 crore recorded in the same quarter last year. Wipro’s Q4 FY 23 sales totalled Rs 23,190.3 crore, which was a little less than the quarter ending in December 2023’s Rs 23,229 crore. Also read: How encroachments by Wipro, society housing super-rich are responsible for Bengaluru floods Other big names who took salary cuts Along with Rishad Premji, Wipro’s Chief Financial Officer Jatin Pravinchandra Dalal’s remuneration was also slashed, both in terms of dollars and rupees, reported CNBC-TV18. He received Rs 8.9 crore for the fiscal year 2022–2023 as opposed to Rs 12.1 crore the year before, a decrease of nearly 32 per cent. Despite a little decrease in salary in monetary terms, the CEO of this IT major continues to be the most-paid CEO. In comparison to Rishad Premji and Jatin Dalal, Thierry Delaporte’s compensation has only slightly increased when expressed in rupees. His overall compensation for the year ending in March 2023 will be Rs 82.41 crore, up from Rs 79.81 crore in the previous year. While the compensation has increased by more than three per cent in rupee terms, the value in dollars has decreased by about five per cent. With inputs from agencies Read all the  Latest News ,  Trending News ,  Cricket News ,  Bollywood News , India News  and  Entertainment News  here. Follow us on  Facebook,  Twitter and  Instagram.