February 10, 2017 5:40:51 pm
IT giant Infosys on Friday denied any governance lapses as alleged by founder NR Narayana Murthy, and two other co-founders. In an interview to news channel NDTV, former chief finance officer V Balakrishnan of Infosys said chairman R Seshasayee must resign. He told the channel that communication between important shareholders and the board has broken down and the board should be reconstituted and all concerns should be addressed. Meanwhile, Sikka has asked employees at the firm to keep their focus and not be distracted by media speculation “designed to stir up gossip or rehash old rumour”.
The mail sent by Sikka said: “Let us not get distracted by media speculation that is designed to stir up gossip or rehash old rumours or speculate on the unknowns, around visas, or anything that questions our commitment to governance, integrity and values, in order to generate headlines and create, in the words of the Wire, Eardrum Buzz.”
The entire controversy revolves around a pay hike for CEO Vishal Sikka along with a severance package provided to two former top executives of the company. Chairman Seshasayee has given his backing to Sikka. In a statement, Seshasayee has said the company is fully aligned with the strategic direction of Vishal Sikka and is very appreciative of the initiatives taken by him in pursuance of this transformation.
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The founders have remained silent on reports of their reported displeasure over the goings on in the firm they established 35 years ago. As reported by the Indian Express, several members of the board of Infosys did not deny the reports of the founders raising concerns but stated they were not authorised to speak on these questions. Biocon chairperson Kiran Mazumdar Shaw, who has been on the Infosys board since 2014, had said, “I am not answering any questions on Infosys. There is only one person who can answer, that is the chairman of the board.’’
In a decision taken by the board on February 24, 2016 to reappoint Sikka as the chief executive officer from April 1, 2016 to March 31, 2021, it also approved enhancement of Sikka’s package to USD $11 million from the previous $7.08 million under an executive employment agreement. The CEO’s 2016 package comprised of $1 million as salary, variable performance linked pay of $3 million plus $2 million in restricted stock units and an additional $5 million as performance-based stock option. The 2014 package had comprised of $900,000 as the base salary, $4.18 million as variable pay and $2 million as one time stock compensation.
(With ENS inputs)
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