Median compensation for professional chief executives in India increased by 5% year-on-year to about Rs 10.5 crore in FY26, as per a report by Deloitte India. This growth rate represents the slowest pace since the COVID-19 pandemic period. The rise was subdued due to the underperformance of the equity market, impacting the value of stock-linked compensation, a significant part of executive pay.
The report highlighted that approximately one-third of CEO pay is tied to stock awards, leading to a notable decline in total compensation because of the poor equity market returns over the last 12 to 18 months. Chief Financial Officers (CFOs) witnessed pay hikes ranging from 4% to 10%, with CFOs experiencing the highest gains. This was attributed to factors such as high attrition rates, a focus on capital efficiency, and expanded board-level responsibilities with direct shareholder accountability. The median compensation for Indian CFOs was reported to be around Rs 4.5 crore.
Deloitte India also noted the increasing prominence of the chief digital officer role as a CXO position, with robust performance evaluations for CXOs in India. Anandorup Ghose, Partner at Deloitte India, emphasized the maturity in CXO compensation decisions in the country. Despite rising market volatility and geopolitical risks, boards and remuneration committees are expected to maintain a steady approach, adjusting strategies based on evolving domestic and global events.
The evaluation of CXO performance in India involves financial and non-financial strategic metrics, with data-driven assessments and discretionary rewards determination. This approach aids organizations in aligning long-term business plans with compensation strategies while upholding accountability. Rather than employing a uniform stock awards plan, remuneration committees and Chief Human Resources Officers (CHROs) are increasingly opting for multiple long-term incentive schemes for various employee groups, signaling a significant shift in India Inc’s remuneration tactics.
