An independent law firm, which investigated the issue of severance package given to Infosys’ former chief financial officer Rajiv Bansal, found no impropriety, according to sources familiar with the development.
The independent law firm’s investigation came after a whistle-blower raised the issue, the sources said.
“You may say it was a generous move. But this is not unusual in the U.S. context,” a legal expert, who declined to be named, said.
Sources suggested the mutually agreed amount has not been paid in full to Mr. Bansal as the company was probing “some negligence” on his part. Sources in the top management indicated there was no lack of engagement with the founders. Nevertheless, the management had to keep in mind the interest of all the shareholders, sources said. The CEO compensation, referred to as an ‘old issue of April 2016’ by sources, was cleared by close to 98% of the shareholders, they said.
‘Compatibility issues’
A series of compatibility issues at the top management level led to a mutually agreed separation agreement to release Mr. Bansal from Infosys, it was learnt.
Sources said enough disclosures had been made suo moto on the issue at appropriate platforms.
Meanwhile, OppenheimerFunds, the third-largest institutional investor in the company and independent director Kiran Mazumdar-Shaw, also Biocon chairperson, came out in support of the company and the board. OppenheimerFunds wrote an open letter to the board supporting the management led by CEO Vishal Sikka. In the letter, Justin Leverenz, portfolio manager, Oppenheimer Developing Markets Fund,wrote, “As large, long-term investors in Infosys, we want to express our support for the management team of Dr. Vishal Sikka. There have been loud, cancerous rumours of intervention by non-executive founders in the management team.”
“We would strongly encourage the Board of Directors to restrain divisions in the firm and contain inappropriate interventions by non-executive founders. Let Vishal do what he was hired to do, without distractions. And appraise him on his efforts,” it said.
Ms. Mazumdar-Shaw said there had been no breach in governance issues in the commpany. “There may be judgement calls on which we differ with the promoters but I think over time we will try and see how we can allay these concerns that the promoters have in terms of the way the board conducts itself.”
Meanwhile, in televised comments, former CFO of Infosys, V. Balakrishnan reportedly said, “The chairman should step down and an interim chairman appointed. If needed, the board should be reconstituted.”
