The gap between CXO compensation in India and the US may be closing as multinationals and Global Capability Centers (GCCs) reward leadership with handsome base salaries, bonuses and stock options, executive searches and hiring from firms like EMA Partners, Insist Consulting, Michael Page, say Randstad, Teamlease and Avsar.
While US CXO salaries have risen 15% between 2020 and 2024, Indian counterparts have seen a nearly 40% increase over the same period, recruitment agency data shows.
While the difference between leader pay is large in absolute terms, when adjusted for purchasing power parity (PPP) and factors such as the cost of living and inflation, the difference has narrowed, experts say.
Major companies have been outsourcing functional processes such as supply chain, financial analytics, human resources and payroll to India for years due to manpower quality, cost control, process focus and other reasons, but US leaders have always had priority. That is changing as responsibility becomes more shared in the ‘2 in a box’ model of collaborative management, says R Suresh, managing director of executive search firm Insist Consulting.
The boss of a GCC in India can be paid $1-1.5 million at the top, while a CXO in a multinational in the US can be paid $800,000-1 million at a $2-5 billion company.
“CXOs in India often demand salaries of Rs 3-4 crore ($350,000-450,000). We have three to four mandates running in Bengaluru, where pay is not an issue,” said Suresh. “At the CEO-2 level, where the designation is lower but the individual often reports directly to the CEO, salaries can go up to Rs 2.5-3 crore.”
CEO-1 refers to CXOs in a company. CEO-2 refers to roles that report to CXOs.
Compensation in the US is now heavily indexed to equity, and the GCCs are no exception. Indian employees of these GCCs will also get shares in global companies, Suresh added.
According to a study by Deloitte, the average compensation for CEOs in India this year was Rs 13.8 crore, a 40% increase from the pre-Covid period. The number of CEOs earning more than Rs 20 crore in target total compensation has doubled in the last four years.
As India’s GCCs transform themselves from cost centers to revenue centers, even the gap for CXO-1 roles such as vice president (VP), senior vice president (SVP) and business heads is closing faster, experts say.
India is no longer just home to back offices and while companies here are seeing cost arbitrage at the entry and mid-level, they are not doing so for the top positions, says K Sudarshan, managing director of executive search firm EMA Partners India.
“Now the most important jobs are being moved out of the US. For example, we are conducting a CIO search for a US company that is moving its entire function to India,” he said. “The compensation for the role is comparable to that in the US. In some cases, even at the CXO level, if we take equity into account, the compensation can be close to $1 million. For sub-level executives, salaries could be Rs 1.4-2 crore plus shares.”
A CEO in the US earns $1-3 million annually, compared to Rs 3-10 crore ($350,000-1.2 million) in India, says Navneet Singh, founder and CEO of Avsar.
“However, an Indian CEO earning Rs 5 crore ($590,000) enjoys a standard of living that in many cases is equal to or better than a US-based CEO earning $1 million,” he said.
“For example, while a VP in the US can earn between $250,000 and $500,000 annually, a VP in India can now earn ₹1 to 2 crore ($117,800 to $235,500) annually, with additional benefits that significantly increase their total compensation,” said Singh . “This trend is particularly evident in sectors such as IT services, fintech and pharmaceuticals.”
India is leading global salary growth, with an expected increase of 9.3% by 2024, driven by demand for technology and skills shortages in AI, cloud and cybersecurity, said Neeti Sharma, CEO of TeamLease Digital. India’s smaller pool of experienced CXO talent, combined with cost efficiency, young workforce and booming sectors such as technology and renewable energy, have led to sharper salary increases, she said.
“In the US, CXO salaries are significantly higher,” said Anshul Lodha, managing director of Michael Page India. “We do see that the salary gap (taking PPP into account) has narrowed in recent years due to the growth of startups, the ease of doing business and tax benefits. We can also see a similar trend for CXO-1 roles, including VP, SVP, heads of business, etc., where professionals insist on stock options in addition to a decent base salary, to have a potential ROI.”
Certainly, with a higher market cap, the wealth creation opportunities for CXOs are greater in the US.
“We expect the gap to narrow over the next decade due to factors such as technological advancements, India’s young and English-speaking workforce and the China+1 strategy,” Lodha said.
While the pay gap between executives in the US and India is still large, many are choosing to lead from India early in their careers, an opportunity that would make them true global leaders, says Milind Shah, managing director of Randstad Digital India .
