Recent annual reports from India’s prominent tech unicorns, including Zomato, Paytm, Delhivery, and Nykaa, have unveiled some surprising trends regarding gender wage disparities. These reports, which highlight the differences in median wages between male and female employees, reveal stark contrasts across the sector. As these companies continue to shape India’s digital economy, understanding the implications of these disparities becomes crucial.
Credits: CNBCTV18
Unequal Wages: A Closer Look at Paytm and Nykaa
Paytm is notable among the unicorns in the tech industry for having a large gender compensation gap that favors female employees. The company’s FY24 report states that women made 160% more than males did on average. This discrepancy raises concerns about Paytm’s internal dynamics, including the distribution of jobs and responsibilities across genders. This raises the idea that men are underrepresented in some roles within the organization, even though it may also indicate that women are occupying more senior or specialized positions.
On the other hand, Nykaa, a company that is associated with female empowerment and is run by a woman, Falguni Nayar, the CEO, displays a 27% lower median income for women than for males. This information is especially unexpected considering Nykaa’s leadership and market standing. With a male-to-female employee ratio of 1.79, Nykaa outperforms its counterparts in terms of gender balance, significantly outpacing Delhivery’s ratio of 17.5 male workers per female employee. This prompts an important query: Does Nykaa go far enough in promoting gender pay parity, or is this just a front?
The Broader Implications of Gender Wage Disparities
The pay differences seen in these businesses have wider effects on India’s labor market as well as the IT sector. These disparities may, among other things, affect the talent pool that these businesses are able to draw in and keep. While Nykaa may have trouble luring top female talent despite its gender balance, women may gravitate toward Paytm because they perceive it as an employer that recognizes their efforts more fairly.
These differences may also have negative effects on one’s reputation and legal standing. Employers, investors, and consumers may take issue with organizations that exhibit large gender salary inequalities as more businesses come under fire for their pay policies. Maintaining gender salary parity in the age of corporate transparency and social responsibility is not only a question of justice but also a business imperative.
The Impact of the Funding Winter on Salaries
The larger economic environment has also influenced pay patterns, especially the financing winter that the tech sector faced in FY24. Many businesses have had to make budget cuts due to a decrease in available cash, which has resulted in lower compensation. For example, throughout the fiscal year, Zomato’s employees’ median compensation decreased by 16.8%, yet salaries at Delhivery and Nykaa remained unchanged.
Paytm and Mamaearth, interestingly, defied the trend, with Paytm claiming a 7% increase in median pay and Mamaearth reporting a noteworthy 20% increase. This discrepancy may be a sign of the companies’ differing financial standing and strategic priorities, as well as the varied effects of the funding constraint on various businesses.
Executive Compensation: The ESOP Effect
Executive remuneration has remained strong in spite of the general wage compression, especially through Employee Stock Ownership Plans (ESOPs). Top CEOs have frequently kept receiving big compensation, largely shielded from the economic crisis.
For instance, Paytm disclosed that its top executives spent Rs 1,138 crore on ESOP benefits, with CEO Vijay Shekhar Sharma and CFO Madhur Deora benefiting most. Comparably, the top four executives of Policybazaar received a combined Rs 201 crore in FY24, while Zomato’s top executives accounted for 33% of the company’s total ESOP expenses.
The Road Ahead: Balancing Growth with Equity
The difficulty of striking a balance between growth and equity—both in terms of gender and total salary distribution—will grow in significance as India’s tech unicorns continue to flourish. Businesses that can successfully handle these difficulties will probably become leaders in both business and in establishing industry norms for inclusion and justice.
Especially at well-known businesses like Nykaa, addressing gender wage gaps involves more than just changing pay scales—it also entails making sure that every employee feels appreciated and inspired. The next stage of development for India’s unicorn tech companies might depend on their capacity to create more egalitarian work environments, where success is distributed more fairly among all organizational levels.
