Home >Industry >Infotech >With new CEO in place, Nandan Nilekani takes a step back at Infosys

Nandan Nilekani, co-founder and chairman of Infosys Ltd, is increasingly playing a less active executive role at India’s second largest IT outsourcing firm and has handed over responsibilities to new chief executive Salil Parekh and his top lieutenants, according to three people familiar with the developments.

Since returning to Infosys as non-executive chairman on 24 August, Nilekani for the most part of his stint operated like a “super CEO", playing a hands-on executive role to steer the firm through one of its most tumultuous times in the wake of former CEO Vishal Sikka’s departure.

Up till December, Nilekani spent at least two or three days a week working out of Infosys’s corporate headquarters in Bengaluru, reviewing the performance of business unit heads, strategizing and regularly calling or meeting the company’s largest clients, which farm out hundreds of millions of dollars worth of business to Infosys every year.

That has changed since Parekh took office on 2 January. Since then, Nilekani has gradually cut his visits to office to once or twice a fortnight, allowing the CEO freedom to focus on executive responsibilities—even though both Parekh and Nilekani remain in regular contact over the phone, the people cited earlier said, requesting anonymity.

This move, according to one of the three executives cited above, has created a “clear delineation" between the roles of the CEO and the non-executive chairman. Significantly, according to the CEO’s employment contract, Parekh, like his predecessor Sikka, can use the “Good Reason" clause to terminate his employment agreement with Infosys, and still be eligible for severance payouts, if Infosys appoints an executive chairman.

Nilekani taking a step back easily counts as one of the most significant developments over the past three months at Infosys. To be sure, though, it does not mean that he plans to leave anytime soon and he continues to be active on board-level matters, according to the three people, who added that he will continue as chairman at least until March 2019.

The people highlighted the three priorities on Nilekani’s agenda. First, to further reconstitute the current board and appoint new members; second, to find a long-term successor to head the board; and finally, to ensure harmony between all key stakeholders, including the promoters and the board.

“For Nandan, it’s very important to ensure that the mistakes of the previous succession are not repeated. When Sikka took over as CEO in 2014 and all the founders left at one go, it left a huge vacuum on the board. Those gaps were never really filled and the company suffered as a result," said the first of the people cited earlier.

Nilekani declined to comment for this story, when Mint approached him for an interview. Infosys declined to comment as well.

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