The frosty relationship between the Board of Infosys and the founders appears to be thawing with the help of a third-party legal firm and there seems to be resumption of communication between the two parties to resolve at least some of the issues. Infosys founder NR Narayana Murthy had questioned the corporate governance standards at the company but people familiar with the situation told FE that informal talks have begun between the two camps. Sources said that any likely resolution of the issues will depend on how the talks progress as the current situation has led to a certain sense of unease on both sides.
The Board has stated that it appreciates and respects inputs from the founders and that it is committed to fulfilling its fiduciary responsibility to act independently and in the overall interest of the shareholders. The Board has recently appointed Cyril Amarchand Mangaldas to receive inputs from promoters and other key stakeholders, evaluate them and make recommendations to the Board. It is understood that certain issues on corporate governance at Infosys were raised by the founders over a period but they were unhappy as these were not addressed to their satisfaction. These primarily revolve around the compensation paid to the senior most executive – chief executive and the exit packages to certain outgoing high-level executives.
The Infosys Board has stated that it receives several inputs from various stakeholders, including the company’s promoters, and gives serious consideration to all those inputs. “While there could be differences in views on these matters, they have been overwhelmingly approved by shareholders, wherever required, and on which due disclosures have been made,” it said. Now, all eyes are on Infosys chairman Seshasayee. It remains to be seen whether he will continue to chair the Board or whether new members will be inducted. Former key executives like TV Mohandas Pai and V Balakrishnan are being looked at, but neither of them have expressed any interest to join the Board yet. Murthy has been favouring Marti Subrahmanyam to become the co-chairman.