Former Infosys Board member TV Mohandas Pai on Monday supported NR Narayana Murthy over his criticism on salary hike given to Chief Operating Officer Pravin Rao.
Former Infosys Board member TV Mohandas Pai on Monday supported NR Narayana Murthy over his criticism on salary hike given to Chief Operating Officer Pravin Rao. Hitting out at the board Pai said that NRN Murthy haas raised legitimate concerns on executive compensation and as the Founder he has right to ask questions. “Infosys is a public-listed company and concerns need to be voiced. A larger debate is needed around executive compensation in India,” he told ET Now. The Indian institutional investors have a duty to debate such issues with Murthy, he added.
Earlier today, a letter that was released to media in which Murthy criticised the steep rise in Rao’s salary. “Giving nearly 60 percent to 70 percent increase in compensation for a top level person (even including performance-based variable pay) when the compensation for most of the employees in the company was increased by just 6 percent to 8 percent is, in my opinion, not proper. This is grossly unfair to the majority of the Infosys employees…,” said Murthy in the letter.”The impact of such a decision will likely erode the trust and faith of the employees in the management and the board,” added Murthy.
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According to a stock exchange filing by the company, only 24 percent of promoter shares voted on a resolution seeking a 35 percent rise in Rao’s compensation, and they all voted for the resolution. The company had sought to reassure investors and analysts in February that it was not being distracted by the dispute with its founders over how the company was being managed.
The company’s founders still own 12.75 percent of Infosys. Led by Murthy, they had earlier questioned the pay rise granted to chief executive Vishal Sikka and also the size of severance payouts given to others, including former finance head Rajiv Bansal