Infosys Governance Row: 10 Points To Ponder

Over the last 24 hours, the Indian IT Industry and media have been abuzz with supposed corporate governance issues at Infosys. Founders have lashed out at Vishal Sikka and the board via a letter that highlights possible corporate governance issues under the new management. While no facts have been presented until now, additional news material was floated this morning with some strong commentary from none other than NR Narayana Murthy himself.

Greyhound Standpoint

#1 There is misreporting about Vishal’s compensation; both the figure and structure are aligned to standard industry practices and not out of the ordinary.

#2 Critical to note that the governance issues haven’t been proved (yet) and it will be unfair to conclude on the basis of the letter.

#3 There will always be differences in how an organisation can be run and this is expected all the more when founders are no more at the helm.

#4 Separating ownership from control is one of the long-standing battles for founders and latter raising concerns post stepping down from the helm is both correct and expected.

#5 Such counter actions by investors are a standard practice globally and such instances shouldn’t be blown out of proportion.

#6 Onus to ensure new management stays on target is also on founder-owners and they cannot wait for the former to reach out and seek guidance. The new management (Vishal in the case of Infosys) has a lot to gain from the experiences of the founders provided the feedback is proactive, constructive and timely.

#7 The way this row has spanned out over the past 24-48 hours raises an important question – why are the founders washing dirty linen in public? Such public verbiage by founders can potentially impact investor sentiment and hurt brand Infosys.

#8 In such cases where the founders are questioning the management, it’s important to put facts ahead of verbal punches – else, there is a chance of loss of face and faith for all parties involved.

#9 It’s unfair to compare the salary of a founder to that of professionally appointed management – both have different stakes and the former must expect the latter to be paid per industry standards.

#10 Recent incidents of boorish boardroom behaviour pass a strong message to global CEOs that Indian companies are not ready to accept global talent at the senior management level.


Analyst:

Sanchit Vir Gogia: Sanchit is the Chief Futurist, Founder & CEO of Greyhound Knowledge Group, a Global, Award-Winning, Digital Transformation Research & Advisory Group. He also serves as Chief Analyst & CEO of Greyhound Research, an Award-Winning, Global, Independent Technology Transformation Research & Advisory firm. To read more about him, click here.


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Written by Sanchit Vir Gogia

Sanchit is the Chief Futurist, Founder & CEO of Greyhound Knowledge Group, a Global, Award-Winning, Digital Transformation Research & Advisory Group. He also serves as Chief Analyst & CEO of Greyhound Research, an Award-Winning, Global, Independent Technology Transformation Research & Advisory firm. Read more about Sanchit on http://bit.ly/svgworld.

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