The severance pay to Rajiv Bansal and the hike in CEO Vishal Sikka‘s pay are at the heart of the corporate governance row at Infosys between the board and the co-founders
The Infosys board initially did not take on record discussions relating to the severance pay of Rs 17.38 crore made to former Chief Financial Officer Rajiv Bansal at its meeting on October 12, 2015, says a report in the Mint newspaper, quoting a source.
Infosys’s board only put this payment on record only in its board meeting of January 14, 2016 while announcing the third quarter numbers.
The severance pay to Rajiv Bansal and the hike in CEO Vishal Sikka's pay are at the heart of the corporate governance row at Infosys between the board and the co-founders.
In an interview to Network 18, Infosys co-founder Narayana Murthy questioned the generous payout to Bansal—24 months salary—while pointing out that none of the other top ranking executives were given such hefty severance pay when leaving.
There is chatter that Rajiv Bansal may have been given the huge pay out to stay silent on some issue that could undermine Infosys credibility.
Murthy himself had raised the question in his interview to Network18.
“I hope it is not the case (that Bansal has some damaging information),” Murthy had said in the interview.
In the past, the company has maintained that the severance package to Rajiv Bansal was on the basis of a non-compete clause.
However, experts said that Infosys could have explained the rationale for the payout.
“While non-compete could be justified, but one must elaborate what are the areas prohibited and it must relate to loss of opportunities,” said a note by Stakeholders Empowerment Services.