Wipro's Chairman Rishad Premji has undergone a significant reduction in his compensation for the financial year that concluded in March 2023. According to CNBC, his remuneration experienced a cut of approximately 50 per cent, resulting in a total compensation of $951,353. This figure represents nearly half of what he received in the previous fiscal year, as stated by the cited source.
Based on the Form 20-F submitted to the US Securities and Exchange Commission, Rishad Premji's remuneration in the previous fiscal year amounted to $1,819,022. This indicates a reduction of approximately $867,669 in his compensation, reported India Today (IT).
It is worth noting that this is the largest cut he has received thus far, as he had not experienced any reductions during the pandemic. It is reported that his compensation was reduced by 31 per cent during the pandemic period, revealed the same report by IT.
According to the submitted Form 20-F by Wipro, Premji's overall earnings comprise $861,620 in salary and allowances, $74,343 in long-term compensation benefits, and $15,390 in miscellaneous categories. Although he receives a cash bonus as part of his salary, it appears that he did not receive any stock options during the fiscal year 2023.
Similarly, Wipro's Chief Financial Officer, Jatin Pravinchandra Dalal, experienced a decrease in his compensation. In the fiscal year 2022 to 2023, he received a total compensation of $1.1 million, compared to $1.6 million (approximately Rs 12.1 crore) in the preceding year, indicating a reduction of approximately 32 per cent. The specific reasons for the decrease in remuneration have not been disclosed.
The possible reason behind these changes could be a cost-saving measure due to slower revenue growth. Reports suggest that the company has implemented a few layoffs and reduced the pay of entry-level employees. This year, it was reportedly communicated to Wipro employees that only 80.25 percent of the variable pay would be disbursed.
“Given our overall performance across Wipro, and with the company multiplier at 1, the variable pay for Q4 FY 2023 is 80.25 per cent for employees whose payout is linked to Wipro’s overall financial performance,” the company said, according to India Today.
The exact reason for the partial payment of variable pay is undisclosed, but it is likely linked to the decline in revenue growth. According to reports, Wipro experienced a 0.6 per cent decrease in revenue during the fourth quarter of FY23. It has been mentioned that the company's analysis indicated a potential decline of up to 3 per cent for the April-June quarter.