Hundreds of listed companies regulated by SEBI may be paying crores of rupee in a year as salary to their CEOs, but the next chief of the market watchdog is going to get only Rs 3 lakh a month. The government has proposed a consolidated monthly salary of Rs 3 lakh for the market regulator SEBI's new Chairman.
This translates into an annual package of Rs 36 lakh for the Securities and Exchange Board of India (SEBI) chief. The salary package of current SEBI Chairman C B Bhave, whose term ends in February 2011, could not be ascertained.
SEBI regulates all the listed companies in the country and it is quite common for most of them to pay salaries running into crores of rupees for their CEOs and other top management personnels. As per the latest available data, at least 265 companies have disclosed having paid annual remuneration of a minimum of Rs one crore to their chiefs and other top management people during the last fiscal 2009-10.
Many of them are paid more than Rs 10 crore a year as remuneration. While the salary data is not available from most of the about 5,000 listed companies for 2009-10, close to 500 companies had paid salary running into crores to their chiefs in the previous fiscal.
Same is the case for the banking regulator RBI, whose Governor gets a salary far less than most of the banks operating in the country. Ironically, banks need RBI's approval for the salary paid to their chiefs, although the listed companies do not need any clearance from SEBI for salaries paid to their CEOs.
The salaries of both RBI and SEBI chiefs are decided by the Central Government. Inviting applications for the next SEBI Chief, the Finance Ministry has said in a notification that "The (SEBI) chairman shall have an option to receive pay-as admissible to a Secretary to the Government of India or a consolidated salary of Rs 3 lakh per month."
The finance ministry has further said that the person preferably should have more than 25 years of professional experience and in the age group of 50 to 60 years.
"The Chairman shall hold office for such period not exceeding 5 years and shall not hold office beyond 65 years of age, whichever is earlier. He is eligible for re-appointment," it added. The government has constituted a high level search panel, headed by Cabinet Secretary KM Chandrasekhar, for selecting the next SEBI chairman. Finance Secretary Ashok Chawla is also part of the panel.