Infosys’ move to settle with markets regulator SEBI the alleged disclosure lapses involving a severance pact has vindicated NR Narayana Murthy's stand, its former CFO TV Mohandas Pai said today, calling out the company to tender an apology to the co-founder.
He said it is good that the Bengaluru-headquartered company has filed an application with SEBI to settle the issues around severance agreement with ex-CFO Rajiv Bansal.
“This vindicates fully Narayana Murthy’s stand about corporate governance issues regarding the (former) CFO (Bansal) and lack of disclosure,” Pai told PTI.
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The earlier Board tried to brush it under carpet, saying it’s an oversight, when clearly the process was not followed,” he added.
“The (former) CFO being negotiated to go (to resign) with very high compensation is not an ordinary act. Now, the company has accepted that was wrong even though they deny it on paper...to clear this matter up. It augurs well for the company”, he said. The nomination and audit committee chairs should take primary responsibility for “this fiasco and the lack of governance," Pai said.
Withdraw letter issued to stock exchange
He added: “Also, the company has abused Narayana Murthy. The company should withdraw the letter issued to the stock exchanges accusing Narayana Murthy of interfering when he clearly raised issues of corporate governance. The company should withdraw the letter and give an apology to Narayana Murthy for abusing him and damaging his reputation.”
Infosys board blames it all on founders
Some ex-directors of Infosys and commentators, who made “wrong allegations” against Murthy, should also apologise, he said.
“It’s important for investors to stand up for good corporate governance, and not look the other way when corporate governance norms are flouted”, Pai said.
Infosys said on December 6, it has approached SEBI with an application to settle the issues arising out of alleged disclosure lapses on the severance package paid to Bansal.
India’s second-largest IT firm, in a regulatory filing to the BSE, said the settlement application made to Sebi was neither admission of guilt nor a denial.
It, however, did not disclose what it had proposed in the settlement application. “The settlement application process is based on an undertaking that the applicant will neither admit nor deny the finding of fact or conclusion of law,” Infosys said.
Settlement applications for violation of disclosure norms typically involve payment of a financial penalty to avoid punishment in case allegations are proved right at a later stage.
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