Reliance Industries cuts staff strength for third year in a row

For the third consecutive year, Reliance Industries Ltd (RIL) has reduced its staff strength.

During fiscal 2010-11, RIL had 704 fewer employees than the previous fiscal. The number of employees at RIL stood at 22,661 as of March 31, 2011. In the year ended March 2010, RIL's employee count had come down by 1,314 while in 2008-09, it had fallen by 808.

According to the company's 2010-11 annual report, a new salary model based on accountability and responsibility of the staff is also being formulated.

On the new salary model proposed, RIL, in its annual report, said: “FY-11 saw a significant change in the company's compensation and banding management process. On the variable pay front, efforts are afoot to move towards accountability and responsibility driven variable pay programmes designed uniquely for various levels.”

More partnerships likely

On the growth strategy, RIL's Chairman, Mr Mukesh Ambani, said in the report that joint ventures and partnerships will be the way forward. “Growth through partnerships will be a key part of our strategy. These partnerships will address both the Indian markets as well as provide us with entry points into global markets. We are gearing up for the next phase of growth through a combination of our own initiatives and forging new partnerships with leading companies,” Mr Ambani said.

In the last five years, the company had signed more than 50 partnerships in retail, energy and financial services. Two big ticket deals announced recently include a partnership with BP for its oil and gas exploration business, and that with DE Shaw for financial services.

“Several international companies have approached Reliance to be their partner… in establishing niche businesses in India.

“We will participate in this sector through partnerships with leading global companies,” Mr Ambani added in the report. He said the company is also looking at investing in petrochemical capacity additions, organised retailing and digital services to propel growth.

On the importance of retail, the company said, “Growth in the Indian economy and demand creates unprecedented opportunities for RIL to invest significantly in each of its core businesses, including those that leverage directly from growth in consumerism and increase in consumption.”

No salary cut for Mukesh

Reliance Industries’ Chairman Mr Mukesh Ambani’s remuneration remained at Rs 15 crore. This is even while the company’s total remuneration for top management personnel and commission paid to nonexecutive directors declined during the 2010-11 fiscal.

Mr Ambani did, however, decide to forego Rs 23.75 crore for the last fiscal from his annual compensation as the chief of RIL. The company said the decision was taken toreflect “his desire to continue to set a personal example for moderation in managerial compensation levels.”

The total remuneration for top management during the period fell to Rs 40.67 crore from Rs 40.90 crore, while commission to nonexecutive directors declined to Rs 1.68 crore from Rs 1.75 crore.