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Should there be a CAP on CEO's salary in India...?

Created by : Japan Shah, H.O.D, Oxford School of Management  | 10 05 2009 17:56:30 +0000
Industry : Public Sector/GovernmentFunctional Area : India(Markets)
Keywords : government law equity
Activity:  3024 views;  last activity : 07 06 2010 20:18:09 +0000

We all know our Minister of Corporate Affairs , Mr. Salman Kursheed warned firms against paying huge salaries to top company brass and said the government would keep a watch on executive compensation.He also said that the CEO's are paid vulgar salaries.

Also in 2007, Prime Minister Manmohan Singh told a business lobby to avoid "excessive remuneration" and to "discourage conspicuous consumption," warning widening inequalities could lead to social unrest.

Do you think that there should be CAP on the CEO's Salary...?

  
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Top Argument
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Yes CEO salary increase have to in same proportion as the salaries increase for employees.
By Ramakrishna Perumal, Electrical Specialist Engineer,  10 08 2009 09:16:30 +0000
 
Top Argument
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Frankly speaking i do not accept the idea of keeping a CAP on the CEO salary. We have alraedy seen a lot of cut in few CEO in the recent slowdown.

I believe that the CEO must be the best guy in the market to run your company in the best possible manner, to get the best talent and to sustain that one needs to pay him well. Also another aspect nowadays we are having a reverse brain drain in our country, if you want the best professionals you need to compensate them well. 

If the government comes with a CAP on salaries then the companies will find other ways to pay them, which would result into more on black money and will result into corruption...

I believe we must not follow the US in this as we are a developing nation and the CEO are paid rationally in our country.
By Japan Shah, H.O.D, Oxford School of Management  10 05 2009 17:56:30 +0000
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The reasons adduced in favor of 'no limit' sie, are: (1) The CEOs are those who lead the organization to profitability and success. (2) The bubus in the country's bureaucracy amass wealth. (3) The human desire is insatiable.

1. The CEO's duty is to provide proper leadership and lead the organization on profitable lines. For doing his duty let him be paid reasonably high salary and benefits. But to argue that there should not be any limit for it is not acceptable. For anything under the Sun there is a limit and there has to be a limit.

2. If the politicians and the babus in bureaucracy amass disproportionate wealth, we should find out ways for punishing them. We should not have it as a model for CEOs.

3. It is true human desire is insatiable. But it should not be so. If the individual concerned is not cultured enough to control his desire, then the law of the land should do it for him.
By Kumbakonam S Venkataraman, Associate Editor, Dynamic Youth online magazine  | 10 19 2009 16:01:15 +0000
1
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Yes, definetly there should be cap on CEO salary. why can't the part of the CEO salary spent on Donations / Drought Relief. it may be not bad idea.
By MAJETY CHANDRA SHEKHAR, Construction-Residential, SINDHU INFRATECH  | 10 08 2009 02:40:15 +0000
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yea its i am in your favour. your views are correct
By GHULAM JEELANI, Network administration & Computer Engineering, Hardware self Employed Business  | 10 06 2009 09:11:52 +0000
0
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NO WAYS....
By dilip gour, NA, ABCABC  | 10 23 2009 13:15:36 +0000
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One common observation in the yes's and no's. Middle Managers and lower has voted more for the capping of the CXO Salary and vice versa.

They are the ones who turn around the organization. They either create a fortune or ruin the fortune that is left.  Most of them have proven their caliber while some have not. We point out fingers only when they are not doing well. there is absolute silence when it comes to all the contribution he has made for that organization to be.

Wishing all the CEO's and the future CEO's/CXO's to reach beyond their expectations.

 

Best,

 

Vinod Kurian

http://www.linkedin.com/in/vinodkurian
By Vinod , Training Consultant, DOOR Training & Consulting  | 10 20 2009 11:47:56 +0000
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0
no
By MOHANRAO HINDURAO PATIL, ASSOCIATE VICE PRESIDENT, Uttam Galva Steel  | 10 20 2009 08:03:17 +0000
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GENRALLY CEO ARE THOSE WHO HAS STARTED THE ORGANISATION .THEY HAVE TAKEN THE RISK OF BUISNESS AND SOME ONE HAS COME FROM ANY EMPLOYMENT.

THEY ARE THE ONE WHO IS PROVDING JOBS  TO SO MANY PERSON .I SUPPORT THERE SHOULD NOT BE CAP ON CEO
By HARISH , Production Manager BLUE STAR  | 10 12 2009 13:42:53 +0000
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I have got one simple argument that in todays prevailing world order no amount earned is great enough to satiate the dezires of human being and empirical evidence suggest that monetary benefits are the major source of motivation towards targets of course not the accomplishment of mission and objectives but then targets lead you toward the fulfillment of the mission in the long run and hence the salary of CEO should not be capped.

Secondly he being in the most authoritative position to manipulate the things in his interests if he so desires so let him accept what he values himself of to enable him to maintain his moral standards. Our bureucracy is full of glaring instances where those elite class babus amass wealth disproportionate to their income and yet no concrete action holding accountability is effectively implemented. Hence there is a need for corrective action in Govt Sector and not In the Private Sector .
By Satish Chandra Tripathi, Admin/Facilities Manager, Indian Air Force  | 10 09 2009 14:56:41 +0000
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The CEO is the important person in the company if we keep his desire of salary not to his mark then his decision may bring the company to the end.
By Mohammadarif.A.Shaikh , Consultant, My Learning Centre (CALORX)  | 10 09 2009 06:37:23 +0000
1
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i agree with the points given by Japan Shah.CEO who lead and guide the organization ,question of  salary CAP doesn't arise.
By KRISHNA KUMAR CHANDRAKAR, Professor in the Department of Electronics and communication Engineering, MAT'S UNIVERSITY GULLU ROAD ARANG RAIPUR(C.G)  | 10 08 2009 08:35:21 +0000
1
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CEO means "Chief Enlightened Officer".If an Enlightened officer is not eligible for

high salary then who is eligible....a layman??? Social unrest is directly

proportional to feelings....Selection of CEO is based on principles of Meritocracy

not Democracy..
By Ranjeet Kumar, Strategic HR Professional  | 10 07 2009 16:00:20 +0000
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CEO runs the organisation ,It is a professional fees paid for his Value addition for the overall growth of the organisation.

It cannot be equated to a cost based material. Its id for his brains that is worth not the chair he sits!
By Charles davison, Project Manager, Douglas OHI LLC  | 10 07 2009 03:41:00 +0000
2
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There is just no justification for such a cap.

However, there could be regulatory controls so as to ensure that salary does not exceed profits and the company goes into a loss like our Air India.

best regards
By Ajay Chaudhari, Chief Executive Officer, Adroit Consultants  | 10 06 2009 17:17:34 +0000
2
0

I don't think there should be a CAP on the salaries of CEO's. A CEO is the most important person in a company & he needs to be compensated well. Also i consider the argument of the government to be absolutely vague that it creates social inequality & unrest. I would like to ask that how many CEO's are there in the country, a handful i guess. Remuneration should be according to the work a person does. So paying a handful of CEO's is surely not going to create a social inequality. 

I don't know what is the problem with the government. Is earning more bad ?? Is being materialistic bad ?? I don't think so. They don't understand that this is in turn going to help our country progress. So what's the problem with that ?? I think such comments by our ministers are politically inspired, they just want the junta to believe that a huge social divide is being created by paying a handful of CEO's more ....... that's ridiculous. The ministers must understand that there are greater problems in front of the government and should instead concentrate upon them.


By Suvrajit Gangopadhyay, B.E. (Elex. & Comm.)  | 10 06 2009 09:51:58 +0000
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CEO is one of he main reasons of running the organisations. They have suffered a lot in this recent slowdown so I don't think they should be given CAP rather, its better if they apply HAT on them. Because, as Japan said, if CAP is applied on them, companies will pay them in other ways resulting in black money.
By Gargi Sinha, Senior Consultant, Hewitt Associates  | 10 06 2009 08:16:17 +0000
3
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there should be a HAT and not a cap on the CEO's salary
By Ajay Ziz, Dy. Registrar,, University of Jammu  | 10 06 2009 06:46:17 +0000
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