Panaya deal: Infosys indicates no wrongdoing, Narayana Murthy reacts, says we will no longer know the truth

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Bengaluru | Published: October 24, 2017 10:41:43 PM

Infosys founder N R Narayana Murthy on Tuesday said he stands by every question he raised on poor governance at Infosys. Murthy also said “we will no longer know the truth.”

Narayana Murthy had alleged governance lapses in Infosys under the leadership of former Chairman R Seshasayee. (Reuters)

Infosys founder N R Narayana Murthy on Tuesday said he stands by every question he raised on poor governance at Infosys. Murthy also said “we will no longer know the truth.” The statement from Murthy comes after Infosys Chairman Nandan Nilekani had said, “After careful consideration, the Board reaffirms the previous findings of external investigations that there is no merit to the allegations of wrongdoing.” Narayana Murthy had alleged governance lapses in Infosys under the leadership of former Chairman R Seshasayee. He had also questioned the hefty severance package offered to former Chief Financial Officer Rajiv Bansal and also irregularities in the acquisition of Isreal-based company Panaya for about $200 million.

“I stand by every question on poor governance raised in my speech to Infosys investors dated August 29, 2017. The fact remains that none of these questions have been answered by the Infosys board with the transparency it deserves. I am disappointed,” Murthy said in a statement. “The core question still is how and why the Infosys board approved an unusual and unprecedented severance payment agreement of 1000% (of the standard Infosys employment contracts) to the former CFO, and why the board did not disclose this information proactively much earlier. Sadly, it appears we will no longer know the truth,” Murthy added.

Earlier in the day, Infosys in a statement had said, “The Board also firmly believes that it is time to put these issues to rest. It seeks the support of all stakeholders to look towards the future, and to collectively focus on strategy, operations, and growth.”

Nilekani, also said, “I believe that all stakeholders acted out of a strong passion for Infosys, wanting what they believed to be the best for the company and to see it succeed.” Former Infosys chairman R Seshasayee in a statement today said, “The company now deserves a period of stability and undistracted focus on the business. I wish the company all the best.”

A whistleblower in February had written letter to market regulator Securities and Exchange Board of India on the acquisition of Panaya. After receiving whistleblower letter Infosys had appointed external agency Gibson, Dunn & Crutcher and Control Risks for conducting an independent enquiry.

Murthy had also asked for publicising the enquiry report. “After careful re-consideration, the Company has concluded that publishing additional details of the investigation would inhibit the Company’s ability to conduct effective investigations into any matter in the future. Confidentiality is critical to ensuring the candor and cooperation of whistleblowers and other participants in any investigative process,” company said in a statement.

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