N Chandrasekaran defends top pay at TCS, allays shareholder fears

MUMBAI: Tata Consultancy Services (TCS) chairman N Chandrasekaran defended the compensation structure of its top managers after shareholders raised concerns that too many senior employees were being paid high salaries at its annual general meeting on Thursday. “It isn’t correct to say that the company is paying a lot of money to some of the management...They are not overpaid, actually; if at all, we can say that we can pay more…but the company likes to be conservative,” Chandrasekaran said at the AGM. On Thursday, ET had reported that over 100 TCS executives were receiving salaries of more than Rs 1 crore a year. “The board and the nomination committee debates from time to time on how to reward these people who have stayed with the company and performed exceptionally well,” Chandrasekaran said, disagreeing with shareholders who had termed TCS’ employee costs — which are about 52% of revenue — as too high.He also clarified why some employees who had crossed the retirement age were still being retained. “There are niche skills. You have to respect experience,” he said.Separately, TCS said it had won contracts worth more than its total annual revenue in FY19. Speaking to shareholders, CEO Rajesh Gopinathan said the company had secured $21.9 billion worth contracts in the year. The company had earlier reported revenue of $20.91 billion for FY19. The company had “invested significantly” in retraining employees and making them ready for new technology, he added. More than 3,00,000 people had been trained in Agile, logging in 52 million training hours collectively, he said.At the meeting, shareholders also wanted Chandrasekaran to get TCS to boost the fortunes of other Tata Group companies. One stockholder wanted TCS to buy cars from Tata Motors and lease them out to its IT employees, in order to help both companies. “TCS does have a lot of Tata Motors cars,” Chandrasekaran said. The shareholders also urged Chandrasekaran to represent the views of small shareholders when he talked to government leaders, especially about taxes on longterm capital gains and dividends.One shareholder asked if it was possible for TCS to create a software that would allow small shareholders to list themselves as farmers to evade taxes. Chandrasekaran, predictably, did not respond to the question.

from Economic Times http://bit.ly/2WILuDc