Agreed not to air differences publicly, says Infosys chairman R Seshasayee

MUMBAI: The management and major shareholders of Infosys will now try to keep their differences within the company, in an effort to prevent the kind of damage done to the brand by the public airing of discontent. Chairman

R Seshasayee

said he reached out to the founders on Sunday and had a frank discussion with them. “We agreed that we should not have such interactions through the media and should do it bilaterally. There has been a renewed commitment not to spill any such discussions into the public space,” he said in response to a question at an investor call on Tuesday.

Despite conciliatory messages from all involved, co-founder N R Narayana Murthy on Monday said that he hadn’t “withdrawn his concerns”. But he also said he did not want to muddy things further.

Seshasayee said the company is working on a corporate governance framework with law firm

Cyril Amarchand Mangaldas

. He said the firm would recommend specific attributes for independent directors and how they should function. One of the major concerns of the founders was with regard to the appointment of a certain independent director.

Seshasayee said several new processes are also being put in place — benchmarking best practices in severance pay and CEO expenses, and mandating that these be cleared by the audit committee.

When an analyst wondered if the rigour would slow down CEO’s M&A pursuits, Vishal Sikka said the company is always selective in buyouts. “We will continue to look for candidates that fit with our strategic position and strategic direction, and where there’s an alignment of purpose with the founders. Frankly, we are not good in M&A and have not bought that many companies,” he said.

Sikka said the company does not want to buy “yesterday’s tech”. “And at the same time, we want to buy tech that is relevant to us. We have a huge pipeline of candidates. I don’t see huge acquisitions on the horizon, but you never say never,” he said. Infosys’ acquisition of Panaya in 2015 for $200 million came under a cloud, with allegations about excessive payment.

In the absence of big acquisitions, it will be difficult for Sikka to achieve his target of $20 billion in revenue by 2020.

In a note after Tuesday’s investor call, Parag Gupta and Gaurav Rateria, equity analysts in Morgan Stanley Research, wrote: “The company has addressed various issues relating to corporate governance practices, seeking to put media speculation to rest. We believe investors should welcome these clarifications and the focus is likely to move back to business fundamentals.” Sikka said no client raised any concerns during the past week and, in fact, 6-7 large clients expressed strong support (for the management).