CEOs usually get paid lakhs & crores of rupees. To give you a taste, the CEO of Broadcom, Hock Tan, takes home a whopping 24 million dollars which is approximately more than 170 crores. Unthinkable for us mere mortals. But there are a few people like the Infosys chairman Narayana Murthy who takes Rs 1 for salary and Jack Dorsey the CEO of Twitter who takes $1 for salary!
So, what’s the deal with the token salary?
In actuality, the Rs 1 salary is a statement to the Board and the public that he/she is fully invested in the company. It’s a way of showing that the CEO is tying his fortune in totality to the company’s performance. It shows a commitment when there is a business slowdown. It also signifies to the rest of the employees that the CEO feels the pain when a company struggles. So, is this a show of selfless altruism?
No. It most definitely is not.
Even though the salary they earn is Re 1, they make a lot of money through bonuses and stock options. Taking a one-rupee salary comes with a lot of benefits. For instance, they save a lot more on taxes. Besides, they are able to write off expenses like a vacation as board meeting in Hawaii. Car payments, insurance, repairs are all company expenses and that whole chunk of money is saved from taxes. So, by showing only 1 $ as income, they are saved from taxes and hence liability is none and their assets column keeps building up and that further generates income which is further invested in the corporation and which further builds their assets column.
Famous people who take a one-dollar/one-rupee salary
It’s almost a tradition among the tech giants in Silicon Valley to have a $1 a year salary. But we have our own share of desi CEOs who had decided to take Re 1 salary. Here is a list of CROS who take one-rupee/one-dollar salary.
- R. Narayana Murthy (former chairman of Infosys)
- Vikram Pandit (former CEO of Citigroup)
- Sergey Brin (co-founder of Google)
- Jack Dorsey (co-founder and CEO of Twitter)
- Larry Ellison (co-founder of Oracle Corporation)
- David Filo (co-founder of Yahoo!)
- Jerry Yang (co-founder of Yahoo!)
- William Clay Ford Jr. (executive chairman of Ford Motor Company)
- Elon Musk (CEO of Tesla Motors, SpaceX)
- Larry Page (co-founder of Google)
- Steve Jobs (Former CEO of Apple)
- Eric Schmidt (Google)
- Mark Zuckerberg (Facebook)
- Meg Whitman (former CEO of Hewlett-Packard)
- Jan Koum (former CEO and co-founder of Whatsapp)
Not just CEOs, many politicians, and government officials around the world have signed up for the one-dollar/one-rupee deal. Most of them are financially sound as they have their ancestral business/property which is sufficient for their wellbeing due to which decide not to burden the exchequer. People in high-level administration posts take Re 1 salary as a message to the public that they are least bothered about money and do not comply with illegal ways of making money or bribing.
- Jayalalithaa (former chief minister of Tamil Nadu)
- Mamata Bannerjee (current chief minister of West Bengal)
- David Lloyd George (former Prime Minister of the United Kingdom)
- John F. Kennedy (former President of the United States)
- Arnold Schwarzenegger (former Governor of California)
- Ahmed Javed IPS (Ex Mumbai Police commissioner)
Who started this?
Before evolving into a marketing ploy, the practice of taking a 1 rupee or 1 dollar as token salary had an honorable beginning. During the first World War, government executives and businessmen who managed the American industries for the government during the time of war took a salary of one dollar. Why not zero, you may ask. There was a law which forbade the government to employ unpaid volunteers. These heroes who took a one-dollar salary to serve their nation came to be known as dollar-a-year men.