Seshasayee should have a public debate with Murthy on TV: Mohandas Pai

Interview with former Infosys board member

Former Infosys board member T V Mohandas Pai has called on Infosys to announce a share buyback that would help efficient use of capital by India's second largest software exporter and sought to look at the issue of founders raising questions as shareholder activism similar to that in rival Cognizant. He spoke to Ayan Pramanik on his take on the ongoing debate on the company's management practices. Edited excerpts:

With Mr Murthy coming out in the open against Infosys board, is it time that Seshasayee step down as chairman?

I think so, because there are governance issues that the founders has been raising since May 2016 and the chairman has been covering up. Even the press release that was given yesterday was in bad taste. Shareholders of the company are asking for accountability and these are not ordinary shareholders, they are holding nearly 13 per cent. They are talking about governance and not about the business performance and not anything about the CEO. And, the chairman makes stupid remark to say the board is in consonance with the vision of the CEO. It is the company that should have a vision and it cannot be individualistic.    

The company has appointed a law firm to engage with founders and other shareholders. What is your view on this? Is it the right way to do?

It is a totally wrong way to have a law firm in order to engage with the shareholders. Board should form a committee to engage with the shareholders, that is the right way to do it. Shareholders appoint the board and it has a primary duty to care for the shareholders. That means the board does not want to face the shareholders. The board must meet with them and talk to them.

A former senior executive said this is not an issue of law, but governance. What is your take on that?

Yes, this is an issue of governance. Narayan Murthy has raised issues of governance, he knows corporate governance and does not require a law firm to tell him anything. So, the board should have a committee to engage with him. Or, Seshasayee can have a public debate on the TV and Murthy can ask him questions. The company is built on transparency.  

When Mr Murthy says doubts arise that it could be hush money on severance packages to Bansal and Kennedy. Is there concerns that numbers could be fudged?

I do not believe so. They way this severance compensation is given. Nomination and remuneration committee report in the company’s 2016 annual report does not say anything about the severance package given to the former CFO. It is a very important matter, the company should write about it. When a CFO leaves, the audit committee has an obligation to meet him individually and ask if there is anything wrong.  

Mr Murthy has said good people like” NYU Stern professor Marti Subrahmanyam should join as co-chairman and replacement of Lehman as the head of an important board committee; and the appointment of unnamed former Infosys employees “schooled” in the company’s values as directors. If offered, will you take the opportunity?

I have no interest. I am shareholder of the company and as a shareholder I have every right to ask questions to the board. The board treated me and V Balakrishnan shabbily when we wrote to them asking that they must consider a buyback. They did not have the courtesy to write back or talk to us, except for some spokesperson making a media statement saying some shareholders have written and the board will look at it in appropriate time. Are they trying to wash it off?  I think Marti Subrahmanyam is a great person. He will make a fantastic co-chair or chair, I think there will be continuity.