In major development, IT bellwether Infosys has been asked to cough up Rs 12.17 crore along with interest, after the arbitration panel ruled in favour of former CFO Rajiv Bansal, who was in the eye of drama surrounding Vishal Sikka’s exit.
In major development, IT bellwether Infosys has been asked to cough up Rs 12.17 crore along with interest, after the arbitration panel ruled in favour of former CFO Rajiv Bansal, who was in the eye of drama surrounding Vishal Sikka’s exit. “The arbitral tribunal has communicated its decision in the arbitration proceedings in relation to the severance agreement between the company and its former CFO, Mr. Rajiv Bansal. Per the award, Infosys is required to pay Mr. Bansal the outstanding severance amount of Rs.12.17 crores with interest,” Infosys said in a notice to exchanges.
Earlier, out of Rajiv Bansal’s total severance pay package of Rs 17.38 crore, Infosys had withheld Rs 12.2 crore, pending clarifications on the terms of the severance contract, while paying out Rs 5.2 crore. In February 2017, FE Online had written a report explaining how Rajiv Bansal stood to lose Rs 12.2 crore in the high corporate governance drama at Infosys. Read full story here: Rajiv Bansal: How the man in the eye of Infosys governance drama lost in others’ battle
Following this, Rajiv Bansal had taken the firm to arbitration. In response, Infosys had filed a counter claim against Bansal asking for the refund of the previously paid severance of Rs 5.2 crore and other damages. Interestingly, the Infosys conter-claim for refund has also been quashed.
The issue of Rajiv Bansal’s salary assumed heightened focus, after three founders – N R Narayana Murthy, Kris Gopalakrishnan and Nandan Nilekani wrote to the board expressing concerns over the deteriorating corporate governance standards in the firm, and raising the issue of high salaries and severance pay to top executives. In this regard, the issue of high salary drawn by the then CEO Vishal Sikka, and Rajiv Bansal’s severance pay package came into limelight. Rajiv Bansal had quit Infosys in October 2015, after serving at the firm for 17 long years. His severance package from Infosys was agreed at Rs 17.38 crore, equalling his 24 months’ pay, out of which just Rs 5.2 crore was given to him.
Interestingly, Infosys said that it will take legal advice for necessary actions to be undertaken in respect of the award. “While the award acknowledges that Infosys had bona fide disputes, its’ counter claim for refund of previously paid severance amount of Rs. 5.2 crores and damages, has been rejected. The arbitral award is confidential,” the firm said in its notice.