Infosys CFO search may take some time: Experts

Infosys CEO Salil Parekh(C) with CFO Ranganath and CTO Pravin Rao (L)

Three months after Infosys' chief financial officer stepped down, India's second largest information technology firm has been unable to find a replacement.

On Thursday, Infosys  appointed Jayesh Sanghrajka as the interim CFO, a day before Ranganath's last working day at the company. Sanghrajka is the deputy CFO at Infosys.

Does this point to the IT firm's inability to lure talent for the top posts?

Not necessarily, according to experts.

A top headhunter said that in large IT firms, where the promoter is still hands-on in the business, strategic decisions like top-level appointments take time.

“The promoters in firms like Infosys are deeply concerned about the way business is done. Hence, they still have a say in who is hired for the top roles. Even promoting a candidate internally for CXO (top) positions sometimes takes a lot of time, which may dissuade candidates,” he added. He did not wish to be named since his HR firm works closely with IT sector firms.

Analysts have also pointed out that Infosys' larger problem is stemming its high attrition rate, which was 19.9 per cent in the September-ended quarter, and touched 20.6 per cent in the previous quarter.

The company has said it is taking steps to bring attrition to an acceptable range.

Infosys has been embroiled in controversy since last year when a war of words erupted between former CEO Vishal Sikka and the company's co-founder over issues of corporate governance and Sikka's lavish lifestyle.In August last year, Sikka stepped down and Capgemini veteran Salil Parekh took over the top job in January earlier this year.

Analysts have told Moneycontrol earlier that Ranganath or Ranga's stepping down could give could Parekh a chance to do things his way.

Ranga stepped down in August to pursue professional opportunities in new areas.

Emkay Global, in a note to clients at the time, said Ranga's resignation could have been triggered because he wanted to pursue the CEO’s role, which went to Salil Parekh.

Infosys’ reversal in its strategy of choosing growth over profitability conflicts with CFO’s function and exceptional payouts (over 100 percent in FY18/19) as against investments for future growth may not have gone down well, the note added.

Media reports around the time also suggested that Sanghrajka was being considered for a promotion to Ranga's role.

Sunil Goel, Managing Director, GlobalHunt, said that in large organisations like Infosys, there is always a debate on whether the companies should have an insider or outsider for a top position.

“Getting an outsider is a challenge because they need to consider whether he/she is a fit from a culture point of view. A lot of time goes in identifying who is the right fit. Apart, from the professional aspect, large firms like Infosys also look at the emotional aspects and whether the hires would be emotionally compatible with the company," he added.

This is especially true after the Sikka controversy that impacted the sentiment about Infosys and stock price took a hit.