Infosys chairman R. Seshasayee on Monday acknowledged that the handling of the severance package paid to former CFO Rajiv Bansal – an issue that had been raised by some co-founders – had seen a “judgment” error and said the board had agreed to hear suggestions made by the founders as the company faces the challenge of transforming from a promoter driven firm to a professional board driven organisation.
The severance pay given to Mr. Bansal was a “judgment” error made by the company board due to a subjective element that guided the drawing up of severance packages, according to Mr. Seshasayee.
“In determining the severance package of Bansal when he left the company in October 2015, there was a business judgment by the Board and this amount was agreed to be paid,” Mr. Seshasayee told reporters at a press conference here. “In retrospect, I have no hesitation in saying that this compensation would have been different, had the judgment, made in the circumstances, been different. We had some subjectivity in making this judgment,” said the company’s chairman, who went on to defend the high compensation paid to CEO Vishal Sikka and the appointment of Union Minister of State Jayant Sinha’s wife Punita Sinha as an independent director.
“There will be no more Rajiv Bansals. The suspicion of his severance pay being ‘hush money’ is deeply disturbing,” said Mr. Seshasayee, who had been blamed by some of the founders for lapses of corporate governance at the IT major, even as he denied any conflict of interest between the firm’s promoters and the board of directors.
Infosys has appointed law firm Cyril Amarchand Mangaldas to advise on the succession planning, to ensure that views of all stakeholders including the promoters are considered by the board. “The law firm is not appointed to mediate between the… two parties as it is projected. It’s to assimilate views of all stakeholders, including the promoters and to ensure that we have common values within a legal framework.”
Talking about his relationship with the founders, Mr. Sikka said, “There are no differences with promoters. I meet Murthy four to five times a year. I have a very deeply heart-felt-relationship. Earlier today we were talking about Apple watch. His wisdom and experience are deeply valued which is viewed as criticism.”
Defending Mr. Sikka’s use of chartered aircraft for corporate travel, Mr. Seshasayee said, “I have been asked why Vishal Sikka is using corporate jets. Roopa Kudva has been at pains to say we don’t have a corporate jet. Sikka was travelling 60-80,000 kilometres per month. 8% of this was on chartered flights. It is important to equate costs and issues.”