Kumar realized compensation was $8.2 million, up 14% from the previous year, according to the company’s recent filing with the U.S. Securities and Exchange Commission. As reported by TOI, this is due to uninvested performance share units (PSUs).
The SEC agent explains this: “Mr. Kumar’s realization of compensation is significantly lower than his target direct compensation, mainly because his 2024 PSU grant program is satisfied with performance standards in the future.”
What’s in that salary?
Even if only a portion of the package is achieved, Kumar’s salary structure is not moderate. Target salary includes:
- Base wage: Rs 1.025 crore (USD 1.2 million) – 20% increase over FY23
- Annual Cash Incentives (ACI): Rs 2049 crore (USD 2.4 million) – also increased by 20%
- Performance Sharing Unit (PSU): Rs 64 crore (USD 7.5 million) – 9% increase
- Restricted Stock Units (RSU): Rs 4.268 crore (USD 5 million) – 9% increase
His actual 2024 income includes his base salary, ACI payments are 107.3% of the target, and the RSU’s quarterly attributable value is approximately $4.49 million.
The Cognitive Document explained: “The Compensation Committee determined that Mr. Kumar’s target direct compensation for 2024 should be increased to $16,100,000 (11% vs. 2023) to reflect his performance in his first year as CEO and taking into account CEO RESSOR FRIND in CEO SGROUP to better match his target compensation with CEO SG. The unusually high price is $22.6 million, mainly due to the one-time equity award award when he joined the company in January 2023.
His salary is compared to other IT chiefs
Among his Indian IT peers, Kumar sat on the top, but wasn’t very top.
- Former WIPRO CEO Thierry Delaporte received a staggering Rs 166 crore (USD 20 million) in fiscal 24 and received Rs 921.1 crore in severance.
- Infosys CEO Salil Parekh made Rs 66 crore.
- TATA Consulting Services (TCS) CEO K Krithivasan took Rs 252 crore.
- Ltimindtree CEO Debashis Chatterjee made Rs 1.934 crore.
- L&T Technology Services CEO Amit Chadha doubled his salary to Rs 154 crore.
So, although Kumar is not ranked No. 1, he is obviously an elite company.
The huge gap between CEO and No. 1
One of the most obvious revelations in filing is that the cognitive CEO’s salary ratio to the Midiyans is 378:1.
This means that Ravi Kumar’s revenue is 378 times that of the company’s average employee. This figure highlights the widening of the pay gap in the IT sector, especially when more than 241,500 of Cognizant’s 336,800 employees are located in India, with an average salary significantly lower than that of the United States.
Who is Ravi Kumar, the helm
Ravi Kumar took over as CEO of Cognizant after serving as president at Infosys from 2016 to 2022 in January 2023. He holds an engineering degree from Shivaji University and has an MBA from the Bhubaneswar Xavier Management Institute.
His first year as CEO clearly impressed the Cognitive Board, considering the salary increase. However, the huge reliance on stocks based on deferred performance suggests that the company is betting on long-term results, not just short-term numbers.
