It pays to be the CEO of a professionally-run company
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Top 25 executives and chairmen of six professionally-run companies that are a part of the benchmark Sensex at the Bombay Stock Exchange hold shares worth more than Rs 2,100 crore in the companies they work with. In contrast, the shareholding value of top 25 executives of 10 promoter-run companies adds up to just Rs 240 crore.
According to an analysis by The Sunday Express, the current shareholding value of top executives of six professionally-run companies — HDFC Bank, HDFC, ICICI Bank, ITC, Infosys and Larsen and Toubro — adds up to Rs 2,130 crore (as of closing price on October 5, 2012).
While the shares have been earned under the employee stock ownership schemes (ESOP) of these companies as rewards, bonuses etc, the holding does not include the shares that they received and sold in the market, which in some cases is quite significant.
The list includes A M Naik of L&T, who owns over 17 lakh shares of the company currently valued at around Rs 280 crore, and Aditya Puri of HDFC Bank whose holding in the bank is currently valued at about Rs 121 crore.
Also in the list is Y C Deveshwar of ITC who currently holds over 22 lakh shares in the company valued at about Rs 61 crore. His holding stood at over 50 lakh shares as on August 18, 2011, but he has sold a significant chunk, bringing it down to over 22 lakh shares as on August 24, 2012.
The wealth generation is not limited to CEOs or chairmen. Y M Deosthalee, chairman and managing director of L&T
Finance, has shares worth Rs 181 crore; V Balakrishna, Infosys CFO, has shares adding up to Rs 120.4 crore; Paresh Sukthankar, executive director of HDFC Bank, has shares worth Rs 34.5 crore.
Experts say that in many cases, the executives deserved it. "Many of them have performed well, are honest people and have added value," said Mohandas Pai, former director on Infosys board and currently chairman, Manipal Global Education Services.