PAY SCALE OF PSU CEOs - IT IS NOT ALWAYS ABOUT MONEY

By Ruma Dubey

There is so much rah-rah-rah about what Rajan said – lower pay to the top rung bankers while high payment to those in the lower bands/scales.

We all, when we read this, subconsciously nodded an affirmation. This is indeed 100% true. The largest bank of India – State Bank of India Chairman, Arundhati Bhattacharya drew a gross salary of Rs.31.10 lakh in FY16. As against this, ICICI Bank MD and CEO, Chanda Kochchar drew a salary of Rs.4.79 crore for FY16 – 15 times more than SBI Chairman.

For that matter, Bhattacharya draws much lesser than what MD and CEO of HDFC Bank, Aditya Puri got Rs.9.32 crore for FY16; a jaw dropping 30 times more.

As against this, an entry level officer at a PSU bank gets about Rs.6 lakh per annum while at the same level, the private sector pays lesser at Rs.4 lakh per annum. As one climbs up the ladder, the salary rise keeps on shrinking in the public sector while that in the private sector booms. Those in the banking sector say that salary till Scale III in PSU banks are higher than private sector banks and from Scale IV, the balance tilts completely, with PSU lower than private sector, with the disparity only getting wider as one goes up.

Naturally, all are up in arms, agreeing with what Rajan has said with many saying that this is precisely the reason why the PSU bank, or for that matter, all the PSUs are unable to attract the best talent, with all the good ones going to the private sector, as the lure money is obviously higher. This is also said to be the reason why no good talent from the private sector wants to migrate to the public sector.

But seriously, is that really so? Can pay be the only criteria why people prefer the private sector to the PSU? For many, more than the money, it is the quality of work, job satisfaction and more importantly, the work culture which matters more. The task of pandering to the bosses, doing things which you cannot agree with, the political pressures, the lack of autonomy – these are actually the reasons why private sector bank CEOs do not want to join PSU banks.

At the level of a CEO, say, Chanda Kochchar, you think money could be the motivating factor? It brings to mind the Maslow’s Need Hierarchy theory – where after all security and status wants are taken care of, you strive towards self actualization – it is more about what brings you satisfaction from within and less about the society from outside.

This was proven by Mr.Rajan himself. Though he quipped that he himself was not being paid all that well for the job of RBI Governor, the fact remains that he took a leave of absence from the University of Chicago to do this job. Why? Because it’s a job which brings him pride, which is way of servicing the country and you are going to be signing every rupee that any Indian spends in the country. Why would pay matter when what he does directly affect millions of people across the country? In a similar vein, what Bhattacharya of SBI does affects lives of so many people in India, right into the nooks and crannies of the country. How can salary alone matter then?

The fact is that these bankers or the IPS officers or other top notch professionals, working in PSUs do so because it more about the power which the job brings, much more than what a private sector can ever bring. Thus at that level, more than money it is self-actualization (let us for some time, not even consider corruption being a driving force here). It is not as though these professionals do not know their worth; they would very well know that they are getting paid much lesser than their counter parts in the private sector; but they also know that the power they enjoy or the risks that they take, cannot be compared. The PSU bosses could have quit any time and got 30 times or more pay in private sector banks; yet they do not go. Why? Not because they do not have the will but simply because it is more than just about money.

Look around you, surely you come across so many Govt employees; ask them what is the main reason they stick around? And they all almost always give two reasons – job security and retirement benefits. Of course, laxity in work is also tolerated in PSUs but not in private sector – reason for many uninspired to prefer PSU employment.

Yes, payment could get better but for that top level banking professional, the job is less about money. See our badminton player Sindhu – had she played for a private club with tonnes of money, would she have got the love and wishes she is getting today? So sometimes, it is more about the country and less about the money.