Never before has the noise of corporate boardrooms come out so loud in India as it has during the last few months. Just when it seemed that the dust was about to settle on the bitter Tata-Mistry saga, the so-called IT story of India -- Infosys -- has grabbed eyeballs for not so pleasant reasons.
At a time when leading IT stocks are struggling to hold near 52-week lows amid fears of loss of business due to US President Donald Trump's policies, Infosys raised its CEO Vishal Sikka's annual compensation to $11 million for this year, sharply higher than $7.08 million in 2016.
In January, Infosys founders NR Narayana Murthy, Nandan Nilekani and Kris Gopalakrishnan had written to the board of the company, expressing concerns about Sikka's compensation and the severance package offered to ex-CEO Rajiv Bansal and former general counsel David Kennedy. The severance package offered to Bansal was Rs 17.38 crore (24 month's pay), while Kennedy received a package of $868,250.
They also questioned induction of Punit Sinha, wife of Union minister Jayant Sinha, as an independent director of the board.
Meanwhile, Infosys, while it vehemently denied any governance lapses by its board, has appointed law firm Cyril Amarchand Mangaldas to review its governance standards. The law firm, Infosys said, would gather inputs from the promoters and other key stakeholders to evaluate them and make recommendations to the board.
In a statement, Infosys said its board appreciates and respects inputs from the founders, however, it is committed to fulfilling its fiduciary responsibility to act independently and in the overall interest of shareholders.
Infosys board chairman R Seshasayee strongly defended Sikka and said the board was "fully aligned with his strategic direction".
However, V Balakrishnan, former CFO of Infosys, alleged the board chairman should step down taking responsibility for the lapses in corporate governance. He added the board should have an interim chairman and directly address the issues of the founders.
Meanwhile, in an e-mail to employees, Sikka asked Infosians not to be distracted by speculative reports on the spat between the Infosys board and certain founders, who together hold a little over 12 percent in the software services firm.
Observers perceive this as a serious corporate issue in the country where founders find it tough to keep themselves away from the matter of company's board.
At around 3 pm, shares of Infosys traded at Rs 965.85, up 1.8 percent from their previous close on the BSE.