Coforge has denied there was any discord between non-executive Chairman OP Bhatt, non-executive independent director DK Singh and the company’s executive directors before gaps in the internal audit process were flagged by KPMG.
The mid-tier IT services firm said this was evident from the fact that Bhatt and Singh had accepted successive five-year terms on the board earlier this year—in July and February, respectively—before KPMG’s findings came to light in August.
CEO gets top board rating
More importantly, Coforge said CEO and executive director Sudhir Singh had received a perfect performance rating of 5 out of 5 in the board evaluation process before the discrepancies were raised. The peer review showed that he had received the highest rating from all four independent directors, including Bhatt and DK Singh, as well as another executive director on the board.
“These facts demonstrate that, prior to the internal audit observations and the subsequent matters arising from them, the Board Evaluation process reflected a high degree of alignment and confidence between the independent directors and executive directors,” the company said in a statement.
The annual audit had found that Bhatt, who received the lowest performance rating in the board evaluation process, did not share the document containing the Board Evaluation Report (BER) with the other directors, except with Nomination and Remuneration Committee (NRC) Chairman DK Singh. After the board sought explanations from both directors over the withholding of the details, Bhatt resigned on September 8, followed by Singh on September 11.
Singh’s resignation on Thursday cited “differences and tension” between independent and executive directors. Coforge promptly rejected the allegation, describing it as an “afterthought”.
“The Board considers it important to clarify that the chairman and NRC chair’s resignations followed the concerns identified in the internal audit review and the subsequent process undertaken by the Board to seek and consider their explanation in relation to those concerns,” Coforge’s statement said.
Board decisions unanimous since 2024
“As stated, an explanation had been sought only from two directors — OP Bhatt and DK Singh. The internal audit/governance review, and the observations referred to above should be viewed in that context. It is apparent that OP Bhatt and DK Singh resigned as a consequence of these events.”
Coforge also sought to underline the board’s functioning during its transition from a private equity-backed board to one with no promoters. The company said the board has worked in close cooperation, with all business strategy and governance decisions “being approved unanimously” since 2024.
The minutes of board meetings and their video recordings, it said, also reflected the cohesion among directors. Coforge further highlighted that it had delivered “significant growth despite headwinds” that have weighed on the IT services sector.