Infosys chair R Seshasayee should step down, says former CFO V Balakrishnan

Infosys former CFO V Balakrishnan has asked the current chairman R Seshasayee to step down and the company to carry out forensic audi of the severance pay given to former senior management employees.

"These corporate governance issues have been raised over months and they have not been addressed properly. I think there should be accountability," Balakrishnan said. Image Source: Reuters

Highlights:

1. Former CFO V Balakrishnan suggested that a forensic audit should be carried out of the severance pay given to former CFO Rajiv Bansal and chief compliance officer David Kennedy by CEO Vishal Sikka

2.There are allegations of a lapse in corporate governance at the company, a departure from the ethos of the corporate and compensation, severance pay given to the chief executive and certain former employees

Infosys former chief financial officer (CFO) V Balakrishnan said the IT major's chairman R Seshasayee should step down. This came at a time when the founders of Infosys and its board are engaged in a battle after the Tata Sons - Cyrus Mistry fiasco.

He also suggested that a forensic audit should be carried out of the severance pay given to former CFO Rajiv Bansal and chief compliance officer David Kennedy by CEO Vishal Sikka.

“The board knew about all of this and these allegations are in the public. It is better for the chairman to step down and get a new interim chairman who was not part of the decision at the time — maybe (DN) Prahlad — because Prahlad was not part of these decisions at the time and let him do a proper, independent investigation. Let him do a forensic audit and put everything in the public domain and close it once and for all,” The Economic Times reported on Wednesday quoting Balakrishnan, as saying.

“This going on for long in the public domain is not good for the company. This board is a big letdown,” Balakrishnan said.

ALSO READ: Infosys management did not make timely disclosures, says former CFO T V Mohandas Pai

There are allegations of a lapse in corporate governance at the company, a departure from the ethos of the corporate and compensation, severance pay given to the chief executive and certain former employees.

During a recent interview with The Economic Times, Balakrishnan questioned the transparency of the board in handling the matter while addressing the press conference held on Monday.

“As October 2015 press release says Rajiv Bansal has resigned; he has not been terminated. So, when you have resigned, there is no need for a generous compensation. So, the core issue has not been addressed,” the newspaper reported quoting Balakrishnan, as saying.

“When it came to (former general counsel) David Kennedy, the chairman said there is an employment contract and there is a severance in the contract; then we have to honour the contract. Even with Bansal’s severance, that is a contract. But you are not honouring that. Why did you stop the payment if that is fine? Even the investigation report (on Bansal’s severance), they should put it out in the public domain,” he further added.

Seshasayee, in a shareholders' meet on Monday defended the actions of the board.

In the case of Bansal's severance pay, Seshasayee had said the agreement was arrived at after going through circumstances that time and conceded that last year it had put in place a severance policy which does away with any subjectivity, PTI reported.

"There is a trust deficit between the board and the top shareholders. These corporate governance issues have been raised over months and they have not been addressed properly. I think there should be accountability," Balakrishnan added.

ALSO READ: Infosys CEO Vishal Sikka attempts to quell tensions with company founders

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