Infosys begins hunt for next CEO as Shibulal may retire by January
- Contract manufacturer Amber Enterprises aims to raise Rs555 crore through IPO
- Duty to remove defects is of car manufacturer: NCDRC
- Goldman Sachs sees four 2018 Fed rate hikes as US growth gains
- Card transactions soar 84% in September 2017 to Rs74,090 crore: Report
- Virbhadra PMLA Case: LIC agent Chauhan seeks interim bail
Bangalore: Infosys Ltd’s board is putting together a list of internal and external candidates as India’s second largest software services company begins hunting for its first non-founder chief executive officer (CEO) to succeed current CEO and co-founder S.D. Shibulal, who is looking to retire in January.
Infosys has hired executive search firm Egon Zehnder to shortlist external candidates for the role that will mark the most significant leadership transition in the company’s history. So far, the top job has always gone to one of the seven co-founders of Infosys.
Chairman and founder N.R. Narayana Murthy, who is currently crafting the biggest organizational overhaul in the history of the company, said in January that Infosys will consider both internal and external candidates to head the company.
“Everybody would like to see a CEO who has high aspirations, who has courage, who reveres excellence, who will make people feel an inch taller in his or her presence, a person who is very generous, a person who is very, very demanding, and a person who brings confidence and joy around him or her—that’s the kind of leader Infosys should have,” the 67-year-old Murthy had told a press conference.
Murthy had added that the company had a strong pool of leadership talent to pick future leaders from.
“They (the nominations committee of the Infosys board) are looking for the most qualified and capable candidate, both within the company and externally, to take on the mantle from him. We have hired two external partners to help us identify a leader who truly represents the values that Infosys stands for and is best equipped to lead the company into its next phase of evolution,” said K.V. Kamath, lead independent director and a former Infosys chairman, in an email.
Infosys’s move to shortlist external candidates is a departure from its tradition of elevating founders to head the company. Past CEOs have included current chairman Murthy, co-founder and former Unique Identification Authority of India chairman Nandan Nilekani and current vice-chairman S. Gopalakrishnan.
The nominations committee is currently shortlisting potential internal candidates for the top job and has roped in corporate executive evaluation firm Development Dimensions International to help with the process.
Jeffrey Sean Lehman, who heads the committee, is leading the process.
“In an Infosys context, you have to balance the short term with the long term. You have to take the tough decisions; you have to make the choices. You have to be fair and transparent to all the stakeholders. It is about being a link between the external world and the internal world, in keeping with the values of the company,” Shibulal had said in an interview last year, when asked about the kind of leader Infosys was looking for.
Infosys’s board had quietly initiated the process of searching for its next CEO last year. In April 2013, Mint had first reported that some directors on the Infosys board wanted the search to include external candidates.
Shibulal was originally expected to retire in March 2015, after he turned 60.
“Mr Shibulal has expressed his desire to retire as the CEO and MD (managing director) of the company and as a member of the board of directors either on the date of the last board meeting before his superannuation—9 January 2015—or when his successor is ready to assume office, whichever date is earlier,” Infosys said in a statement.
In January, the company had elevated Infosys veterans B.G. Srinivas and U.B. Pravin Rao to the position of presidents, as it sought to allay concerns over succession planning. Murthy has said that among internal candidates, either Srinivas or Pravin Rao could potentially take over as the next CEO.
“This will also create us an opportunity for the nominations committee to consider the internal cadre of people along with the external candidates for the selection of the CEO when Mr Shibulal retires. Therefore, in some sense, it has not only created a good platform to make the organization more efficient, it also created a platform wherein it will be easier for the nominations committee to create a portfolio of candidates for selecting the new CEO,” Murthy had said in January.
“They need to look for a stronger CEO than Shibu (Shibulal) and Kris (Gopalakrishnan),” said Peter Schumacher, founder of Germany-based Value Leadership Group that advises companies on European strategy. “Customers are looking for somebody who can drive the strategic relationships—what’s more important for Infosys going forward is someone who can meet and build relationships with CEOs and senior-level decision-makers in large corporates in the US and Europe. Both Kris and Shibu have not been successful to the degree that was expected in that capability.”
Infosys kicks off the earnings season next week, reporting its fourth quarter financial results on 15 April.