New Delhi: 'Achche Din' seem to have come already for top executives at Indian companies, who have got an average pay hike of 10-12 per cent in 2014, while those in the fast-growing e-commerce business top the charts with up to 20 per cent pay increments.
The passing-by year also witnessed an improved gender and age diversity in board rooms, partly due to new regulations, and nearly 500 publicly listed companies have recruited at least one woman director for the first time.
Besides, the average age of top executives, occupying corner offices, has also come down, while the number of people switching jobs at top positions too declined in 2014. The impact of an improvement in business sentiments since a new government came to power towards middle of the year with a promise of better days appears visible, experts said, as an uptick was noticed in remuneration trends in the second half.
There has been a sense of optimism among executives on hopes for faster economic reforms, while new regulations have also stressed on a need for better corporate governance practices. Going by various surveys, the average increment for executives ranged from 10-12 per cent in 2014 with pharmaceutical and healthcare sectors doling out 14-16 per cent pay hikes and banking and financial sector at 10-13 percent. However, the e-commerce sector gave a much higher average hike of 16-20 per cent to its executives.
"Executives in retail space have been the busiest as the segment has flourished," MeritTrac General Manager (Innovations and New Products Development) Rajeev Menon said. However, the pay increase for executives in IT and ITES sector was lower-than-expected at 9-12 per cent.
"As expected, a positive growth outlook among companies coupled with their efforts to retain key talent led to the rise in increments as compared to last year," Randstad India CEO Moorthy K Uppaluri said.
Noting that pay-packages for executives have grown at a steady pace, CareerBuilder India MD Premlesh Machama said, "This is expected to get better or move faster considering the fact that the quarterly results of most of the countries have started getting better and moving to green zones thus leading to growing remunerations for executives."
According to executive search firm MANCER Consulting's CEO Satya D Sinha, "A new government coupled with rising economic conditions, 2014 has been way better for corporates in India ranging from better pay package to new opportunities,the driving force for senior level corporates has been tremendous." "The year 2014 has witnessed new innovations in terms of new ventures and Indian firms have also started to increase their growth trajectory across globes. All in all this year has been remarkably good for executives," he added.
As per the latest data, at least 450 women have also been hired to 514 directorship positions in 493 NSE-listed companies. Of these 493 companies, 460 had hired a woman director on their respective boards for the first time.
These 460 firms have hired 420 women directors, of which 374 are first time appointees to the board of a listed firm. Interestingly, 67 women out of the total 374 are from the promoter group and 99 are holding non-independent positions, thus leaving only 208 independent women directors. "Companies across the spectrum have been more alive towards ensuring diversity and women participation during the year 2014 as companies have realised that a diverse work force can contribute to increased staff retention and productivity," Unison International MD Udit Mittal said.
According to HR Consultants, while women were found to be entering in and taking up higher responsibilities in sectors like banking, financing, retail and IT, industries like manufacturing have seen a crunch on this parameter. Need for innovation and creativity in a competitive business environment also pushed companies to promote young blood at the top management level.
"A number of youngsters have started occupying corner offices in large corporations. To add to this, there has been a proliferation of start ups in India," Menon said. Sinha noted that "with the need of innovative and creative idea even youngsters have been encouraged for corner rooms. Today, the need for innovation and excellence has been multi-folded due to which the requirement for a talented skill set is on the rise."
In another interesting trend, the lateral movements of top executives was less in 2014. Atiitya Training & HR Consultants' MD Suman Nair said, "There was a certain kind of lull in executive movements. One reason could have been the economic conditions of past couple of years and the uncertainty on expectations from the businesses which were struggling."
On attrition, Randstad India CEO Moorthy K Uppaluri said, "Attrition rates had declined in 2013, however, the improvement in economic scenario over last few months led to more job opportunities resulting in higher attrition rates."
Deloitte India Senior Director P Thiruvengadam said: "More Indian executives are definitely going global and many of them are joining start ups, taking greater risks. The other trend which is noticeable is executives becoming entrepreneurs in their own small way." While executives wait for the Narendra Modi-ledgovernment's promises to yield results, Nair said, "More number of executives are discussing the country politics after a long time, around the coffee machine, companies are taking on the mission of the leader around cleanliness and other interventions."
"There is still some scepticism but the willingness to serve the country seems to be coming back," she added.