Kiran Mazumdar-Shaw Says Infosys Board Did Everything By The Book
The board of Infosys has been transparent in its dealings, says Kiran Mazumdar-Shaw
Infosys Ltd. co-founder N R Narayana Murthy has raised issues of governance pertaining to severance packages given to former chief financial officer Rajiv Bansal and ex-compliance head David Kennedy.
Infosys director and Biocon Ltd. chief Kiran Mazumdar-Shaw, however, insists that Infosys and its board have been transparent in its dealing with the issues. Edited excerpts of an interaction with BloombergQuint over the phone...
Can you give us your perspective on the issues raised by the founders?
I am very very surprised at this media blitz, which is really raking up old issues that have been addressed. I am really at a loss to understand why this is happening. As far as I am concerned, the board is doing everything by the book. Vishal Sikka is doing a good job of getting Infosys (on track) and battling challenges Whether it is (Donald) Trump or the global economy, we are doing very well. You look at Cognizant vs Infosys vs TCS and others. You see the profitability that Infosys has compared to Cognizant. In the top line, maybe they (Cognizant) are better, but we (Infosys) are much better in terms of profitability. Our margins are better, everything is better. Sikka is somebody the whole tech world respects.
It seems the answers given by the board and management haven’t satisfied the promoters?
I can’t help it. Everybody is allowed to have a difference in opinion. That doesn’t mean there is a rift.
The key issue that has been highlighted is that Infosys always had the tradition of disclosing more than required?
People are free to comment. All the issues that were raised by founders and whoever else -- about Rajiv Bansal’s severance, appointment of Punita Kumar Sinha, extension of Jeffery S Lehman, about Vishal Sikka’s salary -- were put through shareholder vote.
Did the severance packages also go for shareholder vote?
The severance was shared with the public, it’s not a shareholder matter. Sikka’s salary, Sinha’s appointment or Lehman’s extension went to the shareholders. We said, ‘you guys decide’. And they all voted in favour. Some of the founders abstained -- that is in public domain. But among the founders, Nandan Nilekani voted in favour of all the resolutions, whether it was Sikka’s salary or Punita’s appointment.
To make Bansal’s severance package very transparent, we did a legal due diligence to assure everybody that nothing untoward happened and we shared the findings on the website. What more transparency do you want?
The question that has been raised is that the severance package was very high?
That’s ok. Please understand, there are reasons. The reason why its very high is explained in the due diligence report. There was a complete report on the severance package. How it was done, why it was done -- all that has been disclosed. What more disclosure do you want?
Was Rajiv Bansal asked to go or did he voluntarily step down?
You should ask the management that question. When there is a severance, there is always an issue where the person has mutually agreed that ‘it’s time for you to go or step down’. And because you are asking them to go, there has to be a severance package. David Kennedy was also (asked to go), (so) there was a severance package. Whenever you are asking someone to go in the middle of their tenure, obviously, you have to compensate them.
What was the reason for asking them to leave?
Anytime you ask someone to leave is because something is not working out in a conducive way. When people are asked to leave, it’s the management that has to take a decision. And then the management basically informs the board that this is what we have done, this is how we are compensating this person and you please approve. That is how it happens.
Also Read: Corporate Dharma And The Infosys Rift