Nandan Nilekani Outlines His Key Goals For Infosys
Nandan Nilekani is expected to speak to investors about the way forward for Infosys.
KEY HIGHLIGHTS
Nilekani's First Day At Infosys
It was a whirlwind first day for the new non-executive chairman of Infosys Ltd., Nandan Nilekani, who returned to the company after more than eight years, capping months-long hostilities between the company’s board and co-founders.
Nilekani hosted a conference call with domestic analysts this morning, addressed the press around 5 pm and finally spoke to foreign brokerages later in the day.
The subject of these conversations were largely the same - focus on bringing stability back in Infosys, addressing long-term corporate governance, the search for a new CEO, the board’s relationship with Narayana Murthy and how Nilekani will approach Murthy’s demand for the Panaya investigation report to be made public.
Here are the highlights:
Board Offers Quasi Apology To Murthy
“The Board believes it to be unfortunate that various differences of opinion have arisen between Mr. Murthy and the Board in the recent past. The Board wishes to express that it was not its intention to cause Mr. Murthy or any other affected person any personal distress or anguish while stating its point of view.”
Board Committee To Work On Strategic Plan
“Board committee consisting of Ravi Venkatesan and DN Prahlad will work with management and take stock of initiatives and create a consolidated plan to be presented to the board in October.”
Engagements With Stakeholders And Working On Corporate Governance Structure Of The Board
“…that it will engage in further broad-based shareholder consultations to determine what further, if any, the Company can take to ensure that it continues to adhere to high governance standards.”
“.…the Nominations and Remunerations Committee will deliberate on the long-term governance structure of the Board and present its recommendations at the meeting of the Board in October.”
Egon Zehnder Appointed To Search For Next Leader
“The Board has also approved the appointment of the executive recruitment firm Egon Zehnder to work with its Nominations and Remunerations Committee to review and identify the right candidate to be the Company’s next CEO and MD.”
Other Details
“There is no time limit on my appointment. I’ll be here as long as necessary to achieve my goals. My goals are to bring in stability and make sure all stakeholders are aligned.”
“I’ve had a series of meeting with senior managements and vertical heads. They are all going out with a clear upbeat message that the company is customer-focused. Today I did a video broadcast with all our employees, they are also enthused.”
“It’s less than 24 hours since I rejoined this company. It’s very premature for me to speak on strategic markets. Which is why I have asked the board committee to work on a report that we can discuss in the October meeting.”
'Company Is Customer-Focused'
On how he will ensure client retention, top talent retention, and avoid any deviation in the transformation from legacy to digital, Nilekani says Infosys has communicated to its clients that the company now has a stable leadership in order to assuage concerns.
The new chairman says he has had a series of meeting with senior managements and vertical heads. “They are all going out with a clear upbeat message that the company is customer-focused. Today I did a video broadcast with all our employees, they are also enthused”
Nilekani reiterates that Infosys has formed a group with Ravi Ventakesan and DN Prahlad who will work with the CEO, CFO, business and delivery letters, anchored by strategy officer, who will over next 3-4 weeks, take stock of strategic initiatives initiated in the last few months. This strategy group will come out with a plan in October which will then be made public.
Infosys Conference Call For Foreign Investors Starts
Nilekani Outlines His Key Goals
- Immediate goal is to bring stability and calmness to the organisation
- Focus on the search for a new CEO
- Look at the long-term corporate governance structure
- Focus on the board’s relationship with Murthy.
- The approach on the recent investigations. “I will go through them in calm, dispassionate , unbiased manner,” Nilekani reterates.
- The Infosys strategey group will meet and take stock of various initiatives and customer needs and will make the strategy report public in October.
Nilekani On His Plans For Infosys
It has been less than 24 hours since I rejoined this company. It’s very premature for me to speak on strategy. Which is why I have asked the board committee to work on a report that we can discuss in the October meeting.
'Ravi Venkatesan Is A Valued Member Of Infosys Board'
When asked about the very public spat between the members of the Infosys board and co-founder Murthy, Nilekani says,
“I am not going to run this company based on comments on Twitter and TV. Ravi Venkatesan is a valued member of the board and he is here to help me.”
View On Vishal Sikka's Performance
What Changed Since Last Friday?
When asked if everything is “hunky dory” now as last Friday the board had a very different view on Murthy, Nilekani responds with a monosyllable, “Ya.”
Releasing Panaya Investigation Reports?
When asked if the agreement to not disparage Vishal Sikka will impede the release of the Panaya investigation reports, Nilekani said, “I will, with the board’s support, take the right action. Leave it up to me.”
Will Infosys Founders Continue Oversight On Board?
Nandan Nilekani On Why Founders Have Had To Rescue Infosys Twice
“I would like to believe that I’m here not just as a founder…. I’m also here because I believe I have a record of doing things in very different environment. I’m also here because I’ve had success in consensus building.”
'Board Discussed Recent Communication With Murthy'
The board expressed it was not its intention to cause anguish to Murthy, Nilekani says.
The board believes it to be unfortunate that the various differences of opinion have arisen between Mr Murthy and the board in the recent past. The board wishes to express that it was not its intention to cause Mr Murthy or any other affected person any personal distress or anguish while stating its point of view.Nandan Nilekani, Non-Executive Chairman, Infosys
On Nilekani's Agenda
- The board is focused on bringing complete stability to the company, Nilekani said while reading from the media statement. It has also tasked its Committee of Directors to work with the CEO and management to review the company's strategy by October.
- He will get a full briefing on the recent Panaya investigations and “appropriate course of action will be taken”.
Infosys Media Statement
Nandan Nilekani On The Priorities Of The Board
Our immediate priority is have stability and make sure management is back to doing what it should which is satisfying customers, transforming the company. In the last 24 hours we have taken a number of steps to reach those goals.Nandan Nilekani, Non-Executive Chairman, Infosys
Here To Take The Company Forward, Says Nilekani
The goal is to build consensus and return stability at Infosys, Nilekani reiterates.
My Appointment Was Unanimous, Says Nandan Nilekani
“I’m here because there’s nobody else,” says Nandan Nilekani in jest at the media conference.
I’m here representing everybody. I’m here representing the full board, all stakeholders.My goal is building consensus.Nandan Nilekani, Non-Executive Chairman, Infosys
Infosys Press Conference Shortly
Nandan Nilekani to address the press shortly. Nandan Nilekani, UB Pravin Rao, Ravi Venkatesan and DN Prahlad present at the briefing.
Key Highlights From The Con-Call
In his first address to investors and analysts after taking over as Infosys’ Non-Executive Chairman, Nilekani said his priorities would be to bring in a new CEO, reconstitute the board and stabilize the business.
Here are the key takeaways from his conference call with analysts:
- Infosys will announce quick decisions in next few days.
- Will be able to give more details about Infosys' strategy only in October.
- Will look for new CEO from within and outside the company; will also consider Infosys alumni.
- Board reconstitution and CEO search will happen parallelly.
- Nilekani will also take part in client conversations if required, in a bid to steer the company towards a “super stable, high growth path”.
Stock To Clock Only Marginal Gains On Monday?
Madhu Babu, IT research analyst at Prabhudas Lilladher expects the Infosys stock to rise only 2-3 percent on Monday, despite Nilekani’s return.
A significant turnaround will only take place after the new CEO takes over, said Babu.
The Infosys ADR, traded in New York, ended Thursday’s session with gains of 1 percent.
Future Tense?
Ravi Menon of Elara Securities expects more departures from the team put together by Vishal Sikka.
Analysts Discuss Key Takeaways From Nilekani's Conference Call
Parallel Goals
The nominations committee headed by Kiran Mazumdar-Shaw will drive the hunt for Infosys’ new CEO, Nandan Nilekani said. “The committee will simultaneously come up with a plan for board reconstitution,” he added.
Key Deliverable
Nothing will make me happier than putting things in a super stable, high growth path.Nandan Nilekani, Non-Executive Chairman, Infosys
The Panaya Overhang
As a parallel to his main focus, Nilekani will also look into any lapses in corporate governance and wrong doing from a legal point of view, he said.
I need to figure out what has happened, what the lapses were, if any. This is a parallel process that we will do, because these are concerns raised by an important stakeholder. So absolutely in the next few months we will look into all these issues and we will bring them to closure to the satisfaction of all stakeholders and without violating corporate governance.Nandan Nilekani, Non-Executive Chairman, Infosys
The company’s previous board has faced several questions regarding the handling of the Panaya acquisition, with founder NR Narayan Murthy calling for the investigation reports on the issue to be made public.
The Search For A New CEO
In response to questions about who Infosys’ new CEO could be, Nilekani said he had an "open mind" and just wanted the “right person” for the job.
- Will look at both internal & external candidates.
- We will also look at Infosys alumni.
- Premature to talk about geographic location of the new CEO of Infosys.
- Will help the new CEO integrate into Infosys.
Nilekani More Than 'Just A Founder'
“I like to believe that I am here as more than just a founder. After resigning from Infosys 8 years back, I have done fairly significant work. I was invited to the board by all parties and I assume people see me as a unifying and wholistic person and I believe I am. This is about consensus building.”
Full Support Of Murthy And Board
Answering queries about possible challenges from board members, Nilekani said he had the full support of the board, promoters and stakeholders.
I have the full support of the board, of Mr Murthy, of all the promoters.Nandan Nilekani, Non-Executive Chairman, Infosys
Plenty Of Opportunities
The board will discuss on how best to integrate the artificial intelligence and machine learning initiatives taken by former MD and CEO Vishal Sikka.
Machine learning is becoming fundamentally transformative in every industry.Nandan Nilekani, Non-Executive Chairman, Infosys
It is important that the company focuses on its transformation and customer needs to re-establish its business growth, Nilekani said.
Details About Strategy Only In October
The company’s future strategy will be discussed with the board in the coming days and more details will be revealed in October, said Nilekani.
The onslaught of new-age companies such as Netflix, Uber, Ola, and Tesla will present “plenty of opportunities” for firms like Infosys, he added.
There’s tremendous opportunity to help incumbent companies stave off the challenge from new-age challengers.Nandan Nilekani, Non-Executive Chairman, Infosys
Too Premature To Talk About Guidance
The new non-executive chairman made it clear that it was too soon for him to speak about the company’s earnings and guidance.
Will Stay As Long As Necessary
“I plan to be here as long as necessary and I will not be here as soon as as I’m not necessary,” said Nilekani answering earlier queries about the duration of his stay at Infosys.
He added that he will “move on” when his tasks are completed.
- New CEO has to be appointed
- Board has to be reconstituted, new members have to be brought in
- The business stabilises
Very confident that we have a large pool of internal and external candidates for the CEO post.Nandan Nilekani, Non-Executive Chairman, Infosys
Board To Consult All Stakeholders
“I’m a big believer in corporate governance standards”, said Nilekani, assuring investors that his focus will be on putting an effective management team in place. “This board will practice the highest standards and fiduciary responsibilities and also, we will consult with all stakeholders,” he added.
Nilekani Speaks
Nandan Nilekani started off the conference by thanking the board members who brought him onto the board, and even those who stepped down for their services.
Nilekani will now focus on:
- The future of the company.
- Taking the company forward and dealing with the challenges.
As non executive chairman I would be responsible for board oversight, governance and functioning.Nandan Nilekani, Non-Executive Chairman, Infosys
Live
Former Infosys CFOs Want Venkatesan Gone
A day after four board members, including co-chairman R Seshasayee, stepped down there were calls for one more director to go. Ravi Venkatesan. And the demand came from none other than two former chief financial officers of Infosys, Mohandas Pai and V Balakrishnan.
Ravi has run with the hare and hunted with the hound. He has played both sides very badly. He has met me personally and said he wanted to get rid of Vishal. He wanted time to say Vishal is not working. And then he made a public statement that Murthy should come back in open. Two days back he changed it because a letter was leaked from the company. And I know who has leaked the letter, I don’t want to say the name. He has played both sides and his conduct has been disgraceful. I want to put it on the public record. And I think he must go, and that we have no trust or confidence in him.Mohandas Pai, Former CFO, Infosys
Personally if you ask me, Ravi has been a big let down. He should not have allowed that press release on Murthy to go to the stock exchanges and belittle him. Murthy is iconic and the best business leader this company has ever produced. Belittling him in public by sending such a press release is a big let down. Ravi should not have been in the board. Nandan has to take the call now in the best interest of the company.V Balakrishnan, Former CFO, Infosys
The Board Right Now
The Infosys board now consists of the following:
- Pravin Rao, Interim CEO and MD
- Nandan Nilekani, Non-Executive Chairman
- Roopa Kudva, Independent Director
- Punita Kumar, Independent Director
- Kiran Mazumdar-Shaw, Independent Director
- DN Prahlad, Independent Director
- D Sundaram, Independent Director
- Ravi Venkatesan, Independent Director
Nandan Nilekani To Calm Investor Fears?
Nandan Nilekani will address Infosys Ltd.’s investors in a conference call today, starting 10 a.m., for the first time after assuming his position as the IT company’s non-executive chairman. His appointment came days after former Chief Executive Officer Vishal Sikka stepped down from his position, after a public spat between the company’s founders and management.
Nilekani is expected to calm investors’ fears that the boardroom battles are hurting the company’s efforts to keep abreast with the changes happening in the information technology services industry. He may speak about possible changes in the company’s board and outline Infosys’ strategy going forward.
The company’s co-chairman R Seshasayee, independent directors - Jeffrey S Lehman and John Etchemendy and Sikka resigned from the board on Thursday evening. Ravi Venkatesan stepped down as co-chairman but will continue as an independent director. UB Pravin Rao will continue as the interim CEO.