'High corporate salaries lead to sense of alienation'
There is no move by the government to cap salaries of executives of India Inc, but fat remuneration to CEOs could lead to a sense of alienation among the underprivileged, Planning Commission Deputy Chairman Montek Singh Ahluwalia has said.
By PTI |
NEW DELHI: There is no move by the government to cap salaries of executives of India Inc, but fat remuneration to CEOs could lead to a sense of alienation among the underprivileged, Planning Commission Deputy Chairman Montek Singh Ahluwalia has said.
"An exaggerated image of success in some parts of the country - if it is combined with what the PM said was ostentation or conspicuous consumption - it can lead to a sense of alienation", Ahluwalia said in an interview to private news channel NDTV.
He further said if the corporate sector wants to create a perception that it is a socially responsible stakeholder, it should look at the issue of excessive CEO compensation.
However, Ahluwalia said that he doesn't think Prime Minister Manmohan Singh wants to "cap salaries. I don't think he said that salaries need to be cut down."
Stating that in the US salary of the CEOs was a major issue, he said the Prime Minister's concern was being echoed by some industrialised countries too.
"This issue of CEO compensation is a very difficult problem to handle in corporate governance", he said, adding that in India, a different environment existed as most of the businesses are controlled by families.
He further said what the Prime Minister meant was that the perception of corporate governance required the corporate sector to address the fact especially when they were the controlling stakeholders.
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