BackNandan Nilekani says will stay at Infosys ‘as long as necessary’, hints at global hunt for CEO
Nandan Nilekani, at an investors' call, says he will stay at Infosys 'as long as it takes' to get it back on track, indicates that the firm will embark on a global hunt for its next CEO
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Newly appointed Infosys Ltd chairman Nandan Nilekani said on Friday he will stay at the firm “as long as it takes" to get it back on track, as the company’s board moved to find a new chief executive officer (CEO) and mend relations with founder N.R. Narayana Murthy.
“I will not put a time frame on this. I do hope it happens as fast as possible," Nilekani said on an investor call, adding that he would step down the day he felt he was not needed anymore at Infosys.
The company appointed executive search firm Egon Zehnder on Friday to find a replacement for Vishal Sikka, who resigned a week ago as the first non-founder CEO of the Bengaluru-based company.
Also on Friday, the board of Infosys as good as retracted a withering statement it released a week ago blaming Murthy for the departure of Sikka, as Nilekani stamped his authority on the company.
“In recent days, there has been considerable discussion of the relationship between the Board of Directors of Infosys Limited and Mr. N. R. Narayana Murthy who established the culture and ethos of Infosys, especially its culture of adhering to high corporate governance standards," the board said in a statement.
“The Board believes it to be unfortunate that various differences of opinion have arisen between Mr. Murthy and the Board in the recent past. The Board wishes to express that it was not its intention to cause Mr. Murthy or any other affected person any personal distress or anguish while stating its point of view," Infosys said in a statement that was issued while Nilekani was addressing a press conference.
Mint reported on 23 August that Nilekani, who cancelled a previously planned trip to the US this week, was very upset at the board’s angry statement and that he had been meeting Murthy every day since.
Nilekani, 62, sent a clear signal that he is very much in charge at Infosys until a new CEO is appointed.
“I’m not going to run this company based on comments on Twitter and television channels. That’s not going to happen," he said. “I’m here at the request of all shareholders to unravel a very complex situation and make sure that everybody is aligned—and take this company, which is a national icon, to its future. So, I’m not going to get pulled into statements that ‘A said’ or ‘B said’. That’s not the way that we are going to operate here."
Earlier in the day, Nilekani indicated that one of his key goals would be to ensure that Infosys, Murthy and the other founders have a healthy relationship.
Nilekani also indicated that he would take a tough approach in fixing all the recent corporate governance issues on the Infosys board, including a previous probe report on the company’s 2015 Panaya acquisition that Murthy has repeatedly insisted should be made public.
On Friday, Nilekani declined to directly answer when asked whether the company would make the probe report public and instead pointed to Infosys’s statement on Friday, which said that he would get a full briefing on all investigations and “the appropriate course of action will be decided".
At Friday’s press conference, Nilekani said that his top priorities would be to identify Infosys’s next CEO and re-constitute the company’s board. He reiterated what he had said during the earlier investor call, saying Infosys would embark on a global hunt for the next CEO and would consider both internal and external candidates as well as Infosys alumni.
Nilekani said Biocon Ltd chief Kiran Mazumdar-Shaw will continue to head the nominations and remunerations committee (NRC) at Infosys and have the responsibility of zeroing in on the next CEO. Shaw has been heading the NRC since Infosys’s board meeting in July.
Investors and analysts welcomed Infosys’s decision to bring back Nilekani and praised his address to investors on Friday.
“We believe the introduction of Mr. Nandan Nilekani—Co-founder and former CEO and MD of Infosys, as the Chairman of the Board of Directors of Infosys is a positive development," Aniruddha Bhosale, an analyst at Deutsche Bank, wrote in a note.
Following the resignation of four directors, including chairman R. Seshasayee, Nilekani will have to address the twin challenges of reconstituting the board and finding a replacement for Sikka, Bhosale noted.
“However, his impeccable track record at executing complex engagements—both in and outside Infosys, make him a favourable candidate for all stakeholders of the company and should help bring stability in business performance," he wrote.
The appointment of Nilekani marks a significant victory for Murthy, who has repeatedly pulled up the company over the past 18 months for perceived corporate governance lapses. Nilekani, who enjoys the full backing of Murthy and the other Infosys founders, returned to the company a decade after he stepped down as CEO.
“We are moving quickly to put in place an architecture to move us forward, including getting the new CEO, and a board structure... on the CEO search, we are going to cast a very wide net," Nilekani said.
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