'Just saying great things...': Narayana Murthy urges firms to treat employees as humans

Infosys founder NR Narayana Murthy on Wednesday had quite the request for firms and entrepreneurs about their treatment of their employees. He also urged them to reduce the pay gap between the lowest and highest salaries. 

Murthy further said in a recent interaction at the TiE Con Mumbai 2025 that one needs to uphold every corporate employee's respect and dignity. 

"To praise people in public and criticize in private, and to the extent possible, to share the fruit of the corporation in a fair manner amongst all employees of the company," he said.

The IT sector veteran believes that future India's development and poverty alleviation will only happen when the country's businesses and entrepreneurs embrace "compassionate capitalism".

As per Narayana Murthy, capitalism pertains to providing opportunity for people to enter the market and create wealth for themselves and their investors.

He added that capitalism is also important for creating jobs for people and reducing poverty besides contributing to taxes so a lot of public good work could take place. 

But what is this "compassionate capitalism" that Murthy is talking about? He said that the role of entrepreneurs was to be "evangelists" of capitalism and said their conduct will decide how capitalism is perceived in the country. 

"It is incumbent on every one of us to conduct ourselves in a way that those sceptics will also say, 'Yeah, there is something good in this thing called capitalism. There is something good in entrepreneurship.' And to do that, all of us have to become strong evangelists, and we have to walk the talk. Just saying great things and not doing them will not be sufficient." 

The million dollar question remains -- Is Murthy's concern too little too late? In January this year, Mohandas Pai, chairman of Aarin Capital and former Infosys CFO, criticised the gap between entry-level salaries and CEO salaries despite boasting record profits. 

“They're exploiting the entry level. I've been talking about them exploiting people because they [have] surplus labor, desperate young people who are getting educated and want to work. It is very unethical, not correct, and against what the industry stands for,” Pai said in an interview with the Hindustan Times.

He further mentioned that the rise in fresher salaries has remained stagnant over the last 13 years whereas CEO salaries have risen astronomically. 

Mohandas Pai stated that a fresher who earned ₹3.25 lakh per annum in 2011 now make only ₹3.50-₹3.75 lakh per annum in 2024, a measly increase of 15 per cent in 13 years.

In contrast, CEO salaries went up by 50-60 per cent in the last 5-6 years, with median pay of top IT executives rising 160 per cent to reach ₹84 crore annually. "Now you don't want to pay freshers? I think it's terrible. This is not the way for the industry to lead the country,” he remarked.