Read: Infosys board's point-by-point rebuttal to founders' charges

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26 Aug, 2025 12:21

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Sidhartha Shukla
Moneycontrol

Bluechip IT firm Infosys has been in the news lately, with its founders and the board slugging it out over the way the company is run.

Yesterday, the company's board led by chairman R Seshasayee held a press conference to specifically answer the charges of corporate governance violations that it has been accused of.

Below are the charges and the counter-arguments made by the founders and the board, respectively, on various issues that have made their way to the media.

Ex-CFO Rajiv Bansal's severance payout

Charges

Founder NR Narayana Murthy and ex-CFOs Mohandas Pai and V Balakrishnan say the company's decision to pay a 24-month severance payout to Rajiv Bansal was exorbitant and not in line with industry practices. At worst, they hinted it could be a signal the company was trying to hush up certain things that Bansal may have known of.

Defence

Seshasayee said that while Infosys had agreed to a Rs 17.3 crore severance pay, after review of certain practices, it eventually paid out only Rs 5 crore.

He added that the company had streamlined the way in which it decided on severance packages for top officials and eliminated the element of subjectivity.

CEO Vishal Sikka's compensation

Charges

Reports said that Infosys co-founders Nandan Nilekani, Narayana Murthy and Kris Gopalakrishnan wrote to the company's board raising concerns on the increase in salary for its CEO Vishal Sikka.

Defence

Infosys Chairman R Seshasayee has defended the compensation revision of CEO Vishal Sikka’s. It was decided to get shareholder approval through postal ballot before increasing Sikka’s salary, which is an example of good governance, he said.

He further added that while the salary was raised to USD 11 million, the fixed component came down to USD 4 million from USD 5 million earlier.

Sikka's use of private jet and purchase of office in Palo Alto

Charges

Mohandas Pai had said, "There was the high cost of offices in Palo Alto, the use of private planes for family, these are breaches of corporate governance. This is not what Infosys is and I think everybody should stand up for certain norms in this country."

Defence

Seshasayee defended allegations on Sikka's use of a private jet and said that in the last couple of months itself, Sikka had travelled 50,000-60,000 km a month and of this only 8 percent was through chartered flights.

Justifying the move, Seshasayee said if a company expected its CEO to travel and deliver value, then the shareholders needed to also make a link between cost and value.

On the acquisition of an expensive office space in Palo Alto, Seshasayee said the company wanted to be known not just as a back office, so the decision was taken to rent an office space on the high street. He further said, “We need to recognize that the global company is trying to rebrand itself. A globally competitive workplace will have to focus on expectations of a new reality.”
Hiring of DN Prahlad and Punita Kumar Sinha

Charges

Reports suggested that some founders were unhappy with the hiring of DN Prahlad and Punita Kumar Sinha and had alleged that it was not on the base of merit.

Defence

Seshasayee defended the appointment of board members Punita Kumar Sinha, wife of minister of state for civil aviation Jayant Sinha, and DN Prahlad.

“We are very proud to have Punita Sinha on our board, a woman should not be judged based on the profession of her spouse,” he said.

Defending the appointment if DN Prahlad, Seshasayee said that Prahlad is well qualified to be on the board as he knows Infosys's business very well.

Apart from the clarifactions made in the press conference yesterday, at different instances founder NR Narayana Murthy and CEO Vishal Sikka had the following things to say.

* On his communication with co-founder NR Narayana Murty, Vishal Sikka answers: "My relationship with Mr Murthy is wonderful. We meet frequently. The drama that has unfolded is frankly distracting."

* Refuting reports which suggested that founders have soften their stance against the board members, Narayana Murthy said that he has "not withdrawn" concerns he had raised over governance but adopts a conciliatory tone with respect to how he is referring to the management.

"They are all good-intentioned people of high integrity but even good people make mistakes," he said. "Good leadership demands they listen to all shareholders and address concerns, take corrective action and improve governance."

* Speaking to CNBC-TV18, Vishal Sikka asserted his steely resolve to stay unperturbed over the recent events at the IT major and said, “I am a kshatriya warrior. I am here to stay and fight.”