Mukesh Ambani to forgo salary, hydrocarbons staff face 10% cut

Mumbai: Reliance Industries’ chairman and managing director Mukesh Ambani will forgo his entire compensation from April 2020 as India’s biggest private sector major announced salary cuts and bonus deferments for directors on the board and for select employees in the hydrocarbons business.The board of directors of RIL, including executive directors, executive committee members and senior leaders, will forgo 30-50 per cent of their compensation, the company said in a letter to employees dated April 29.“The hydrocarbons business has been adversely impacted due to reduction in demand for refined products and petrochemicals,” executive director Hital R Meswani said in the letter. “This has of course put pressure on the hydrocarbons business, necessitating optimisation and cost reduction across all fronts. The situation demands that we maintain a razorsharp focus on operating cost and fixed costs and all of us need to contribute to make this happen.”Salaries of those earning less than Rs 15 lakh a year in the hydrocarbons business have been left unchanged. But people earning more than Rs 15 lakh a year will take a 10 per cent cut in fixed pay. No announcements have been made regarding compensation for employees in other businesses. Hydrocarbons, which includes petrochemicals, oil and gas upstream and refining contributes nearly 75 per cent to total turnover.RIL has also deferred annual cash bonus and performance-linked incentives, which are normally paid in the first quarter of a fiscal year.“We will closely monitor the economic and business environment, re-evaluate a response to the situation on a continuous basis and strive to improve the earning capacity of our business,” Meswani said. “The lockdown period has also provided us with several opportunities to reorganise ourselves and digitalise our business process to generate significant improvements in our productivity, efficiency and costs.”Mukesh Ambani to Forgo SalaryChairman Mukesh Ambani’s salary and compensation of Rs 15 crore remained unchanged for 11 consecutive years. Even as he forgoes his compensation, he would still be eligible for a hefty dividend payment for his shareholding in the energy conglomerate.“He is forgoing his salary until the company and all its businesses are fully back to their earnings potential. The company is taking all necessary measures to optimise costs and mount an effective operational response to Covidled exigencies,” RIL said while announcing the results for FY20.

from Economic Times https://ift.tt/2YtCsJA