Days after Infosys co-founder and former chairman NR Narayana Murthy raised concerns over “governance issues”, “CEO compensation”, and “severance package of former finance head, Rajiv Bansal”, the company board defended its stance on Monday.
“There will be no more Rajiv Bansals,” said R Seshasayee, chairman of the Infosys board. He added, “Bansal’s severance pay being ‘hush money’is deeply disturbing.”
Bansal, it was reported, was given Rs 17 crore as severance, and grapevine has it that he knew company secrets, and the money to paid to keep his tightlipped.
Murthy, who started Infosys in 1981, along with six others, had stepped down from the company’s board in 2014, as Vishal Sikka took over as the new CEO. A tug-of-war between the founders and the management has engulfed the “once high on corporate governance” IT bellwether in a series of allegations and fight back.
Seshasayee defends the Infosys’ board’s stand: “I don’t think there is any battle. There is no conflict of interest. There is only convergence of interest.”
Murthy, too, early in the day had clarifies that there is “no battle” between the founders and the Infosys board. However, he did mention that he did point out what was needed.
He also defended Sikka’s salary, by disclosing that since the time the former SAP employee took over the reins at Infosys, his fixed component has gone down to $4 million from $5.08 million. “Compensation is tied to very high levels of target achievements,” said Seshasayee.
To be fair, Infosys’ share price, since Sikka became the CEO went up by 54% in August 2016. Even though the prices are down, still Infosys is trading 22% above what Sikka had inherited from Murthy.
While Seshasayee decided to clear the air, he did say that the “differences shouldn’t have come out in the public”, signalling the dent it may have caused to the company’s image.
However, for the larger good of Infosys, he said, “we can’t get distracted, and we have to move on.”
Sikka, too, said that he joined the company for its “high level of governance”, signalling that there was no foul-play.
“I take this responsibility incredibly seriously,” said Sikka. “The culture of Infosys defines who we are.”
Meanwhile, Seshasayee continued to defend high expenses – one being the use of private jets by Sikka. He clarified that only 8% of the travel was by jets. He also said that Bansal was given only Rs 5 crore, instead of the agreed Rs 17 crore.