Ever so often, the untimely exit of a top executive from a company is announced as a routine event. And so it is accepted by shareholders of the company, with few if any questions asked on the reason behind the exit or the package paid. And unlike the United States, where the hefty pay packs of top management are questioned, rarely do such instances hit the headlines in India. An example that comes to mind here is a dissenting voice from an LIC representative at a Pfizer shareholder meeting in 2009, opposing salary hikes to the then managing director and two Indian non-executive directors.
Similar scenarios featured in the Infosys battle between its founders and the board of directors. But if there is a silver lining from this cloud that has engulfed the IT major, it is that uncomfortable details were not brushed under the carpet and were instead raised for reasons of greater transparency and governance.
Could it have been done more privately? Perhaps. But that should not be a reason for corporate commentators to read the situation as being one where founders are unwilling to let go. In fact, it sets the benchmark of corporate governance one notch higher, so hopefully next time around more shareholders jump into the fray asking more incisive questions to the founders and boards of different companies.
Shareholder meetings often seem like a cosy club where the questions raised do not really rock the boat.
So if Infosys has had to confront concerns over governance and alleged “hush money” payment, what’s wrong with that? It could set a benchmark for the rest.
Deputy Editor