Outgoing Infosys CEO and MD Vishal Sikka has accused founder Narayana Murthy of carrying out a campaign of "baseless, malicious and personal attack", citing it as the reason behind his resignation in spite of having strong support from the board of the company, which wants him to stay on.
According to reports, the board held Murthy solely responsible for the departure of a "valued" employee. The market reacted badly to the news as well. As a result of Sikka's exit, the Infosys share dropped by 10% and investors lost as much as ₹22,500 crore. At one point, it had touched a 3-year-low by falling 13% and wiping out ₹30,000 crore of the company's market cap. Murthy and his family lost about ₹850 crore in the bargain.
In a valedictory email to over 200,000 employees, written from his office in Palo Alto in the US, Sikka laid bare his frustrations. "Over the last many months and quarters, we have been besieged by false, baseless, malicious and increasingly personal attacks," he wrote. "Allegations that have been repeatedly proven false and baseless by multiple, independent investigations." His decision to leave, he added, was because of the "distractions, the very public noise around us, have created an untenable atmosphere."
Murthy, on his part, responded with restraint. "I voluntarily left the board in 2014 and am not seeking any money, position for children or power. My concern primarily was the deteriorating standard of corporate governance which I have repeatedly brought to the notice of the Infosys board. It is below my dignity to respond to such baseless insinuations."
Sikka, who took over as the company's first non-founder CEO in 2014, was given a staggering salary hike at the end of his first year with the company. Under his watch, two top executives were also given severance packages disproportionate to the salary of most of the employees. Murthy was not only displeased by these examples of bad corporate governance, he also asked the board to investigate the acquisition of an Israeli company called Panaya, involving alleged conflict of interest with Sikka's former employers at the German firm SAP.
In spite of inducting persons of the founders' choice into the board, the Infosys management has not been able to satisfactorily address the latter's concerns. For example, last month, Murthy demanded the results of a probe into the Panaya acquisition be made public even though the investigations hadn't found anything out of place. Reports also mention he felt Sikka was better suited to be a Chief Technology Officer or CTO rather than the CEO. Such remarks, apparently leaked out of context, had left Sikka unhappy, apart from a host of other reasons.
During Sikka's tenure, Infosys grew substantially apart and made forays into Artificial Intelligence as well as other cutting-edge innovations, in a departure from its traditional strengths. Sikka's reputation as a high-performing is believed to have been complimented by his high-flying lifestyle, which allegedly also upset some of the founders of the company.
According to The Times of India, UB Pravin Rao, COO and a veteran who has spent 30 years with Infosys, has been appointed interim chief executive officer and managing director reporting to Sikka. The latter is reportedly staying on as executive vice chairman till a new permanent CEO is appointed by 31 March 2018.
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