This action might not be possible to undo. Are you sure you want to continue?
MEANING OF EXECUTIVE COMPENSATION
Executive compensation is how top executives of
business corporations are paid. The purpose of compensation of an executive is for an individual who is in a management position at highest levels. This category includes presidents vice presidents managing directors and general managers.
FEATURES OF EXECUTIVE COMPENSATION
Managerial compensation cannot be compared to the
wage and salary schemes meant for in other employees in organizations. Executives are denied the privilege of having unionized strength. Secrecy is maintained in respect of executive compensation. Executive pay is not supposed to be based individual performance rather on organizational performance
MEANS OF COMPENSATION
There are four basic tools executive compensation
packages in organization. These are:
Base salary. Allowances. Incentives. Perquisites.
The US compensation institutes Phoenix plan uses compensable factors: Job related experience. Training time required. Frequency of review of work. Utilization of independent choice. Frequency of reference to guidelines. Frequency of work transferred through supervisor Analytical complexity. Time spent in processing information.
Executive compensation in India is built around
three important factors. Job complexity. Employers ability to pay. Executive human capital.
PRIVATE SECTOR vs. PUBLIC SECTOR
The salary of top executives of public sector are
miserable compared to private sector . EXAMPLES: S B I of India chief is paid 10%of HDFC Bank Managing Director BHEL’S chief is getting about 10 to 12 lakhs per annum as against ABB ‘S MD getting nearly 40 to 50 lakhs
Compensation System Components
EXECUTIVE COMPENSATION GIVEN IN DIFFERENT COMPANIES
BASE S ALAR Y CON VEYANCE SPE CIAL ALL OWAN CE S GRA TUITY HRA (H OUSE RE NT ALL OWAN CE S) TRA VE LLI NG ALL OWANCE S PROVIDENT F UND MEDICAL C LAIM BAN K F ACILI TY BON US PROVIDI NG C ARS ST OCK S AND SHAR E
EXECUTIVE COMPENSATION OF ORACLE
Basic salary Conveyance Special allowances Gratuity Provident fund H R A( House Rent Allowances) Traveling Allowances Medical claim Bank facility
IBM EXECUTIVE COMPENSATION PACKAGE
Two main components of executive compensation
Base salary and Cash Incentive/ Bonus Long-term Incentive Compensation Competitive marketplace Complexity of leading IBM Gerstner performance
Three main elements drive compensation package
Executive Compensation at Disney:
Base Salary Performance base annual bonus
Net Income, ROE, ROA, EPS Stock or cash awards
Initial employment, promotion, renewal or fully vested.
somashekar Smita kumari Smitirupa mishra Srinivas.D Subhash mishra