Although there are now many global CEOs in the $1 salary club, they earn their rewards through stock options and other extras. Oracle's founder Larry Ellison earned $96 million through other incentives in 2012. Largely visible in new economy sectors like IT and social media, the concept of token salaries has moved into traditional sectors like banking and consumer durables. In the wake of the 2008-financial crisis, many CEOs opted for lower salaries to cut costs and to tide over the tough business situation. Former Citigroup CEOVikram Pandit, who took over the reins in late 2007, went for one dollar salary till the Wall Street bellwether returned to profitability . In India, RIL chairman Mukesh Ambani slashed his salary by 66% in 2008-09 .
"However,there is a difference between a promoter-CEO and a professional CEO. While both may go for a single digit salary, unlike the former , the non-promoter CEO is granted additional stock when fortunes change," said R Suresh, CEO, Stanton Chase International.
Industry analysts said that linking a CEO's compensation to stock instead of salary helps as the stock price would reflect the management's performance. And if the CEO performs, he would be handsomely rewarded by a strong appreciation of the stock price. Some, however, argue that Re 1 or $1 salary is more of a short-term approach to tide over a crisis situation .
