“The wide gap between median and average CEO compensation (Rs 9.3 crore versus Rs 13.8 crore) indicates the wide range of compensation numbers and some outliers on the higher end,” it added.
While assessing CEO and CXO performance, most companies use a holistic scorecard that includes a mix of financial and non-financial metrics and targets.
However, incentives for CEOs and CXOs are still tilted towards financial company-level goals within those scorecards.
On long-term incentives, Deloitte said the percentage of companies using share-based incentives continued to increase (75 per cent in 2024 vs 63 per cent in 2020) and the the prevalence of stock options, or ESOPs, continued to decrease (49 per cent of companies in 2024 vs 68 per cent of companies in 2020).
“Large Indian companies with more mature and globally aligned compensation practices are pivoting towards Performance Shares and use of multiple incentive plans for different employee cohorts. Conversations in the boardroom have also shifted from the need for share-based payment to the return from these incentive structures to stakeholders,” Anandorup Ghose added.
