In­fosys Now Faces Anony­mous Plaint on Gov­er­nance

Com­plainant writes email to Sebi & US SEC

The Economic Times - - Disruption: Startups & Tech - Our Bureau

Ben­galuru: An anony­mous com­plainant has writ­ten an email to reg­u­la­tors — Securities and Ex­change Board of In­dia (Sebi) and the US Securities Ex­change Com­mis­sion (SEC) — al­leg­ing that the In­fosys board has not ad­dressed “se­ri­ous cor­po­rate gov­er­nance is­sues and con­flict of in­ter­est is­sues re­lated to” In­fosys CEO Vishal Sikka.

ET re­ceived a copy of the email on Sun­day, marked to two other pub­li­ca­tions apart from the reg­u­la­tory bod­ies. In­fosys, In­dia’s sec­ond-largest IT com­pany, is pub­licly listed on stock ex­changes in In­dia and the US. The com­plainant, who claims to be an em­ployee, said he or she is will­ing to talk to reg­u­la­tors and re­veal all in­for­ma­tion. “But, I want to be pro­tected as a whistle­blower,” the email stated.

In­fosys de­nied the al­le­ga­tions call­ing them “false, ma­li­cious and defam­a­tory.” “In­fosys takes any whistle­blower com­plaint se­ri­ously and there is due process to in­ves­ti­gate any com­plaint that comes to us. If we do re­ceive any query ei­ther di­rectly or from the reg­u­la­tory au­thor­i­ties, we will re­spond to it as per the due process,” said the com­pany in a state­ment.

ET did not re­ceive replies to queries on the de­vel­op­ment sent to Sebi and the SEC at the time of go­ing to print. The email from the com­plainant cites In­fosys’ $200-mil­lion ac­qui­si­tion of Panaya as a con­flictof-in­ter­est is­sue. On Fe­bru­ary 13, 2017, based on four in­de­pen­dent sources, ET re­ported that for­mer chief fi­nan­cial of­fi­cer (CFO) Ra­jiv Bansal was un­happy about the buy­out in the pe­riod prior to his exit.

The Fe­bru­ary 19 email is the first such let­ter di­rectly re­ceived by ET. On Fri­day, ET had re­ported that Sebi will seek a re­sponse from In­fosys on sev­eral is­sues raised on the pay­out to the Bansal and the ac­qui­si­tion of Panaya, after they re­cei-

CON­FLICT OF IN­TER­EST

ved an anony­mous let­ter ear­lier that week. “We will ex­am­ine the re­sponse from the com­pany on the let­ter Sebi has re­ceived and see if there is any vi­o­la­tion of securities laws,” a se­nior SEBI of­fi­cial had told ET. “We are closely mon­i­tor­ing the de­vel­op­ments.”

In­fosys de­nied any wrong­do­ing in the Panaya ac­qui­si­tion. “With re­gard to Panaya’s ac­qui­si­tion, a third-party val­u­a­tion was done by Deutsche Bank, and the price at which the com­pany was ac­quired was within the band rec­om­mended by them,” In­fosys said in its state­ment.

In a press con­fer­ence on Fe­bru­ary 13, the board backed Sikka. On Panaya, the In­fosys CEO said that there was no wrong­do­ing dur­ing the ac­qui­si­tion. “There is noth­ing wrong. He (Ra­jiv Bansal) was CFO at the time we went through the process. It was the first time we were do­ing it, so we were ex­tra care­ful.”

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