Salaries of senior executives in India are projected to increase 8.9% in 2022 from 7.9% in 2021, according to Aon’s 11th annual Executive Rewards Survey, released on Wednesday. The salary hike is the highest in five years.
The median CEO compensation for 2022 has reached Rs 7.05 crore, revealed the survey that analysed data across 475 companies from more than 20 industries.
Among top five sectors, manufacturing leads in salary hikes for senior executives at 9.3% salary hike, followed by technology & ITES at 9.2%, life sciences at 8.4%, and consumer at 8%, said Pritish Gandhi, director and practice leader, India, for the executive compensation and governance practice at Aon.
Pay at risk, which is the sum of variable pay and long-term incentives (LTI) to total compensation, for CEOs stands near 60%, while c-level executives including the chief operating officer, chief financial officer, sales head and chief human resources officer follow closely at 50%, Aon data revealed.
Nitin Sethi, partner and CEO, India for human capital solutions at Aon, said, “Not only is the average executive compensation increase highest in five years, but variable pay, and equity grants have also risen as companies cannot risk losing key talent at senior levels as this has implications on delivering business performance.”
The annual long-term incentive for CEOs on average is 125% of fixed pay. Most companies use a mix of performance and retention-based grants, with at least 50% of the grant amount linked to performance measures such as shareholder return, profit, revenue and cashflows, according to the survey.