His elder son, Rishad Premji, chief strategy officer of the company, will be the executive chairman of Wipro, India’s fourth-largest information technology (IT) services company.
Azim Premji will continue as non-executive director and founder chairman.
During his time as chairman, 73-year-old Azim Premji, often considered the conscience-keeper of India’s hugely successful IT services industry, steered Wipro from a fledgling company with just $2 million in sales in 1966 to over $11 billion in diversified business, largely software services and consumer products.
“It has been a long and satisfying journey for me. As I look into the future, I plan to devote more time to focus on our philanthropic activities. I have great confidence and trust in Rishad’s leadership to steer Wipro in its next phase of growth," Azim Premji said in a statement.
While his success in steering Wipro, competing with the likes of Infosys Ltd and HCL Technologies Ltd, is open to debate, few will question his greatest legacy to India’s business culture, that of laying the benchmark for philanthropy and showing the way for corporate India to give back to society.
Often known to be frugal in his spending and austere in his lifestyle, Azim Premji donated two-thirds of his wealth worth $21 billion to charitable causes. As is his wont, he did so with minimum fuss and fanfare.
“He has been most successful in creating a very successful IT company. However, his greatest legacy that he has passed on to the corporate world is philanthropy. He does not throw his wealth around and has shown that wealth does not always have to go to the family and can be given to a charitable cause," said Anu Aga, chairperson of Thermax Ltd, a capital goods maker.
Wipro, which was earlier known as Western India Products Ltd, was founded by Azim Premji’s father, Mohamed Hasham Premji, in 1945. However, his father’s untimely death in 1966 forced Azim Premji to drop out of Stanford University to take over the reins of the company. In what can be described as his tenacity and a hallmark of his greatness, Azim Premji completed his bachelors of science degree in electrical engineering from Stanford 34 years later in 2000.
Over the next two decades, he steered the group from its vegetable oils business into a behemoth, comprising its flagship $8.5 billion IT services company and an over $2 billion privately-held consumer care and infrastructure engineering company.
Typical of his commitment to the company and its employees, Azim Premji’s statement added: “I wish to thank generations of Wiproites and their families for their contribution towards building our company to what it is today. I am grateful to our clients, partners, and other stakeholders who have reposed trust and confidence in us."
Simultaneously, Wipro announced that chief executive Abidali Neemuchwala will also be the managing director of the company, thereby separating the positions of chairman and managing director as required by the Securities and Exchange Board of India.
Rishad, who has thus far been chief strategy officer, has his task cut out. Wipro has lagged behind rivals such as Infosys and HCL Technologies.
Infosys, which ended with $11.8 billion in revenue last year, added $860 million in incremental revenue in the year ended 31 March. Noida-based HCL added $794 million in new business to end with $8.63 billion.
In comparison, Wipro, which is in the midst of a business restructuring, added $60.1 million in new business to end with $8.12 billion in revenue from its IT services business.
Tata Consultancy Services Ltd added $1.82 billion in revenue to end with $20.91 billion in revenue last year.
“Rishad Premji has impeccable credentials and has had wide-ranging professional experience as chief strategy officer of Wipro," said Kiran Mazumdar-Shaw, chairperson and managing director of Biocon Ltd. “He has demonstrated impressive leadership, including as chairman of Nasscom. A worthy successor who has the potential to steer Wipro to the next level."