Infosys board says no discord between directors and Vishal Sikka
In a letter to the stock exchanges and the media, Infosys Ltd has said that it “categorically rejects any speculation or allegation of discord between the Infosys Board and Dr Vishal Sikka.” Sikka resigned abruptly as CEO of Infosys on Friday and in a blog post (LINK) blamed “ unrelenting, baseless and increasingly” personal attacks for his decision to step down as CEO of Infosys, adding that he had no regrets from his three-year tenure at India’s second largest software services exporter.
The company’s clarification on the relations between Sikka and the board come in the background of a report published in Mint that cited a letter written by N R Narayana Murthy, the co-founder and former chairman of Infosys, who has been sparring with the board over what he sees as significant corporate governance issues, that said that three directors, including the company’s Co-Chairman Ravi Venkatesan had told him that Sikka was CTO material, not CEO material.
In its letter, Infosys blamed Murthy’s criticism for Sikka’s exit . “Mr. Murthy’s continuous assault, including this latest letter, is the primary reason that the CEO, Dr. Vishal Sikka, has resigned despite strong board support,” it said.
Narayana Murthy on Friday said he was ‘extremely anguished by the allegations, tone and tenor of statements made by the board, it below his dignity to respond to baseless insinuations.
Murthy’s issues with Infosys, that first came to light early this year, have to do primarily with allegations of wrongdoing in Infosys’ Panaya acquisition and the resulting severance payout to CFO Rajiv Bansal who was not initially in favour of the deal. Infosys has repeatedly clarified that four separate investigations conducted by independent entities have thrown up no sign of any wrongdoing. Murthy has pushed for the reports of the investigations to be made public, most recently in a 8 July mail to the board. The company has said it sees no need to.
In its letter, Infosys has accused Murthy of trying to interfere in its working. It said: “Mr. Murthy has demanded that the board adopt certain changes in policy, else he will attack board members in the public, which threat was carried out when the board did not acquiesce; he has demanded that the Board appoint specific individuals onto the board under similar threat, without appropriate disclosure and without regard to basic determinants of appropriateness or fit of the candidate for the role as a board member.” And “notwithstanding that the remuneration package of senior management was approved overwhelmingly by shareholders (including members of the promoter group), Mr. Murthy preferred his dictat to prevail with no place or tolerance for the outcomes of shareholder democracy,” Infosys said. The letter also claimed that “Mr. Murthy wanted the demands to be adhered to without attribution to him.”
“Over time the demands have intensified, which when declined by the board resulted in the threats of media attacks being carried out,” Infosys said.
Mint has reached out to Murthy and will update the article as soon as he responds.
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