Infosys board gives clean chit to Panaya deal

The Infosys board under chairman Nandan Nilekani today gave a clean chit to the controversial Panaya acquisition, saying there was no merit in the allegations of wrongdoing.

"After careful consideration led by our Chairman, the Board reaffirms the previous findings of external investigations that there is no merit to the allegations of wrongdoing," Infosys said in a statement.

In the eye of storm over founders' alleging corporate governance lapses and questioning high severance packages to former key officials, Infosys today reported its second quarter numbers.

This was Infosys' first earnings announcement after Nilekani took over the reins of the Bengaluru-based company, following protracted acrimony between the founders and the management that eventually resulted in the sudden resignation of the then CEO Vishal Sikka and a board rehaul.

Giving a detailed outline of the review undertaken on Panaya issue, Nilekani said: "In light of my review of these matters, I am fully persuaded, as is the entire Board, that the conclusions of the independent investigations are correct."

Infosys founder NR Narayana Murthy had demanded that the full report by Gibson, Dunn and Crutcher on whistleblower allegations pertaining to the USD 200 million Panaya deal, be made public.

But Infosys today said that after a "careful re- consideration" it has concluded that putting out more details of the probe would "inhibit the company's ability to conduct effective investigations into any matter in the future".

Emphasising that confidentiality was key to ensuring the cooperation of whistleblowers and other participants in any investigative process, the company cautioned that the precedent of releasing the full investigation reports could impair the cooperation of participants in case the need arises in future.

Further, the company asserted that its review had confirmed that "appropriate" and "timely disclosures" were indeed made on severance payments to the former CFO.

Nilekani, himself a co-founder who had previously described Murthy as an iconic figure, today said he is grateful to well-wishers of the company including Murthy for "their deeply held passion" for Infosys.

Acknowledging Murthy's role in building Infosys as also in corporate governance matters, Nilekani said the endeavour, going forward, will be to build a "trusting relationship" with the founder.

"The Board notes that the questions and scrutiny in relation to these matters were fuelled in part by the strong feelings that various stakeholders have for the Company and its success. Questions were raised by stakeholders who have a deeply held passion for Infosys," the company statement said.

It added however that the time had come to put these issues to rest and focus on strategy, operations and growth.

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