Infosys defends CEO Sikka’s salary increase

Infosys, India’s second largest IT services company, defended reports relating to the salary hike of its chief Vishal Sikka and also the severance pay given to former chief financial officer Rajiv Bansal and chief compliance officer David Kennedy.

In an official statement, Infosys clarified reports regarding a letter sent to the board by three promoters.

“The Board received suggestions and inputs from various stakeholders, including promoters, which are evaluated with due importance. The company will continue to be guided by the overall interests of all the stakeholders,” it said.

There were reports that Infosys co-founders Nandan Nilekani, Narayana Murthy and Kris Gopalakrishnan wrote to the board raising various concerns including the increase in salary for its CEO Vishal Sikka.

As per reports, the letter questioned the severance pay given to Mr. Bansal and Mr. Kennedy.

Infosys had raised Mr. Sikka’s annual compensation to $11 million, including Restricted Stock Options, to be paid subject to achieving various targets.

Mr. Bansal who was the CFO of Infosys till October 2015, resigned from the company effective December 31, 2015. He was given a severance pay of ₹17.38 crore which was equivalent to his 24 months’ pay.

In October last, Infosys had clarified on the payment of the severance pay to Mr. Bansal. The IT major had conducted two independent investigations, after the resignation of Mr. Bansal, which have not revealed any wrongdoing on the part of the company or its former executive.

When contacted, Mr.Kris Gopalakrishnan, one of the co-founders of Infosys, declined to comment on the issue as also the letter sent to the board. As per the BSE, Infosys promoters along with their family members own 12.75% stake in the company.

“With regard to concerns on governance being discussed in the media, we would like to reiterate that all decisions have been made bona fide, in the overall interests of the company and that full disclosures have already been made thereon,” company added in its statement.

In a separate regulatory filing to the BSE, Infosys also clarified on reports saying that it had drawn up plans to buy back shares.

“There have been several reports in the media that Board of Infosys is meeting in the next few days to consider ₹12,000 crore share buy-back.

“On the share buy-back, the company would like to clarify that its policy is not to comment on rumours or speculation. Further, the company has always complied with its reportable obligations under the Listing Obligations And Disclosure Requirements (LODR) in a timely manner and will continue to do so.”