Infy files settlement plea with Sebi on Bansal’s severance pay
BENGALURU: Infosys Ltd has filed a consent plea with the Securities and Exchange Board of India with regards to an ongoing probe by the markets regulator related to the company’s decision to give a generous severance payment to its former chief financial officer Raj iv Bans al, a move which drew the ire of some proxy advisory firms and experts.
On Wednesday, Infosys in a notice to the exchange said that the firm had submitted a settlement agreement based on an undertaking that it will neither admit nor deny the finding of the findings of the regulator’s investigation. It said that the company wants to resolve the allegations that it failed to seek prior and separate approval of the Nomination and Remuneration Committee and the Audit Committee in relation to the severance agreement signed with Bansal.
“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 in the filing. “Through the settlement process the com- panyw ant store solve allegations relating to the company not seeking prior and separate approval of the nomination and remuneration committee and the audit committee in relations to the severance agreement entered into with the former CFO.”
Infosys said it would provide an update on the settlement “upon conclusion of the confidential settlement process .”
Proxy advisory firms and experts expressed unhappiness on three issues with regards to this latest disclosure by Infosys.
Firstly, Infosys until now has failed to disclose the stock exchange or investors with regards to any ongoing inv es ti ga- ti on by Se bi. Rather, all this while the company has said that it has answered questions the market regulator had asked the firm.
“Now it is to be asked why Infosys did not make a disclosure if at all Sebi was conducting some investigation ,” said S hr ir am Subramanian, founder and MD of proxy advisory firm InGovern Research Services.
Secondly, Infosys seeking a settlement with Se bi again raises question if the company admits to wrongdoing in the board’s decision to award ₹17.38 crore in severance to its former CFO Bansal in October 2015.
“This means that Infosys feels there has been no proper disclosure to N RC ,” saidJN Gupta, MD and co-founder of Stakeholder Empowerment Services (SES).
Finally, Info sys named independent director D Sun dara mas new chairperson of the audit committee in October, replacing Roopa Kudva. “The question which needs to be answered is if this change was made because the firm admits to some lapse made while the board agreed to give severance to Rajiv Bansal,” said the executive cited above.
An email sent to Info sys seeking comments went unanswered.