Nilekani steps in as Infosys investors fume over whistleblower complaints

EY, Shardul Amarchand to conduct probe; CEO, CFO recuse themselves

Infosys co-founder and company Chairman Nandan Nilekani has once again emerged as the man of the moment even as the firm he leads grapples with another crisis-like situation and an erosion of more than Rs 53,000 crore in market cap following allegations of unethical practices.

As soon as the markets opened on Tuesday after a holiday, Nilekani swung into action by informing the exchanges that the company was conducting an investigation into the complaints of a whistle-blower. Sources in the know said he attended an audit committee meeting at the Infosys campus on Tuesday. D Sundaram, Punita Kumar-Sinha, and Roopa Kudva are members of the committee.

“The chairman is in control of the situation and is engaged with all stakeholders to assuage the concerns of investors,” said a person familiar with the development. Nilekani steps in as Infosys investors fume over whistleblower complaint.

The company is also learnt to be looking into the circumstances in which confidential financial information was recorded and stored as claimed in the whistle-blower’s letter. However, this hardly helped the situation with the company’s share prices plunging 16.21 per cent to settle at Rs 643.30 on the BSE. This is the sharpest intra-day fall in Infosys shares in more than six years. It erased the IT major’s market cap by Rs 53,131 crore and dragged it below Rs 3 trillion.

Infosys to leave turmoil behind as Salil Parekh takes over as CEO today

Salil S Parekh will take over as the chief executive of Infosys on Tuesday

 

Salil S Parekh will take over as the chief executive of Infosys on Tuesday as the information technology (IT) bellwether looks to shed its past year of turmoil and forge ahead with a focus on execution and grow business by engaging clients via digital contracts.

For Parekh, a former Capgemini executive who rose through the ranks to be on its global board after successfully building its offshore base in India, the top job at Infosys will be his first that will put him under public scrutiny. So far, Infosys, listed on the Indian and global stock exchanges, has built its reputation on transparency and good corporate governance.

A lapse in disclosure by former CEO Vishal Sikka, who took charge in August 2014, about offering severance pay 10 times the standard contract to former chief financial officer Rajiv Bansal had escalated into a public spat between the board and the founders led by N R Narayana Murthy. This had resulted in the resignation of Sikka and R Seshasayee, then board chairman, last August, paving the way for co-founder Nandan Nilekani to return at the helm.

Nilekani realises that he has to stay longer at Infosys to ensure a smooth transition for Parekh, who will operate out of its headquarters in Bengaluru. Parekh will also need to fit in a culture of frugality that Murthy and Nilekani built over the past three decades, engage with in-house talent and ensure higher returns to stakeholders.

An operational man, Parekh had led the growth trajectory for Capgemini India as an offshore destination to deliver client projects and help the European firm remain competitive. During his tenure, Capgemini team grew from 800 people to over 85,000 people in India, which included leading the acquisition of iGATE Corp....

Read more: Infosys CEO Salil  S Parekh