Industrialist Anil Ambani has taken a huge cut in his total remuneration from four main companies of Reliance Group in 2011-12 as it was about Rs 5.5 crore, lower by nearly two-third from the previous year.
New Delhi: Industrialist Anil Ambani has taken a huge cut in his total remuneration from four main companies of Reliance Group in 2011-12 as it was about Rs 5.5 crore, lower by nearly two-third from the previous year.
Ambani's cumulative remuneration as Chairman of these four companies -- Reliance Communications (RCOM), Reliance Power (R-Power), Reliance Infrastructure (R-Infra) and Reliance Capital (R-Cap) -- stood at over Rs 17 crore in 2010-11.
Ambani does not take salary from any of these companies, but gets sitting fees for attending meetings of the boards and other committees. Besides, he is entitled to commission payable to directors, as per the rules of the respective companies.
As per the latest annual reports of these companies, Ambani did not even take any commission from three companies -- R-Power, R-Cap and RCOM -- during the last fiscal.
At RCOM, Ambani had waived his commission for 2009-10 and this was the third consecutive year in 2011-12, when he did not take any commission from this company.
Industry experts say many top executives of Indian companies have volunteered for pay cuts, and even no salaries, in the past few years as talks of austerity measures have gained momentum amid adverse economic conditions.
Among other leading industrialists, Sunil Bharti Mittal as Chairman and MD of Bharti Airtel took a 22 percent pay cut with a total remuneration of Rs 21.3 crore in the last fiscal. IT giant Wipro's chief Azim Premji's remuneration also nearly halved to Rs 1.9 crore in 2011-12.
Anil's elder brother Mukesh Ambani had capped his annual pay package as Reliance Industries Ltd Chairman at Rs 15 crore a year for four years now.
An analysis of remuneration details in the annual reports of Reliance Group companies shows that Anil Ambani was paid sitting fees of Rs 80,000 at R-Power, Rs one lakh each at R-Infra and R-Cap and Rs 2.6 lakh at RCOM during 2011-12, resulting into a total of about Rs 5.4 lakh.
At R-Infra also, Ambani's remuneration for 2011-12 included only sitting fees of Rs one lakh, while he did not get any payment towards salary and perquisites or commission for the year.
However, the company has disclosed a payment of Rs 5.5 crore to Ambani in its 2011-12 financial accounts, as "salaries, commission and other benefits paid/payable" for prior year period. This was nearly half of Rs 11.01 crore such payments recorded in the financial statements of 2010-11.
In the fiscal year 2010-11, Ambani was paid commission of Rs 6 crore at R-Cap also, but did not take any commission payment at this company during 2011-12.
Taking into account sitting fees worth about Rs 4.8 lakh at the four companies, his total payments stood little over Rs 17 crore in 2010-11.
Commissions are generally paid to the directors of the companies as a percentage of the previous fiscal and any such payments are subject to the shareholders' approval.
RCOM can pay commission of up to three percent to its non Whole Time Directors, but it has not provided for any such payments for the financial year 2011-12 as well.
R-Power, on the other hand, said that it did not pay any amount to its directors by way of salary and perquisites or commission in 2011-12. The company paid all its non-executive directors, including Chairman Anil Ambani, sitting fees of Rs 20,000 for attending each meeting of the Board and its committees.
R-Cap also said that it did not pay any remuneration by way of commission to its non-executive directors, although it can pay up to 3 percent of net profit as commission to non whole time directors.