'Cap CEO Salaries, let shareholders decide pay'

Salaries of chief executives should be capped and shareholders should have a say in managerial remunerations, a parliamentary panel on the new Companies Bill has suggested.

It has asked the Corporate Affairs Ministry to develop a “rational formula” for managerial remunerations.

“The committee are of the view that an overall outer ceiling on managerial remuneration may be prescribed,” said the Parliamentary Standing Committee on Finance, which last week presented its report on Companies Bill 2009 in the Lok Sabha.

“The Ministry may evolve a rational formula for this purpose…The remuneration payable within this overall ceiling may be decided by the remuneration committee of board or shareholders as already proposed in the Bill,” it added.