Hours after Infosys founder NR Narayan Murthy took on CEO Vishal Sikka stating that he wasn’t CEO material, Vishal Sikka has resigned as the CEO and MD of Infosys.
According to the company filing on Bombay Stock exchange (BSE), Infosys has accepted the resignation of Vishal Sikka as the Managing Director and Chief Executive Officer of the Company with immediate effect. As per the filing, Sikka will now be appointed as the Executive Vice-Chairman.
Additionally, U B Pravin Rao has been appointed as the Interim-Managing Director and Chief Executive Officer. He will be reporting to Sikka under the overall supervision and control of the Company’s Board.
The succession plan for appointment of a new Managing Director and Chief Executive Officer has been operationalised by the Board and a search for the same has been commenced.
Sikka will hold office until the new permanent Chief Executive Officer and Managing Director takes charge, which should be no later than March 31, 2018.
According to the company statement, Vishal Sikka cited a ‘continuous stream of distractions and disruptions over the recent months and quarters, increasingly personal and negative as of late, as preventing management's ability to accelerate the Company's transformation.’
The board, the company says acknowledges and regrets his decision. “In particular, the Board is profoundly distressed by the unfounded personal attacks on the members of our management team that were made in the anonymous letters and have surfaced in recent months,” the statement said.
In a letter to his employees, Sikka spoke of the transformation that Infosys is currently undergoing. However, the distractions and constant drumbeat of the same issues while ignoring and undermining the good work that has been done, he says, take the excitement and passion out of this amazing journey.
“Over the last many months and quarters, we have all been besieged by false, baseless, malicious and increasingly personal attacks. Allegations that have been repeatedly proven false and baseless by multiple, independent investigations. But despite this, the attacks continue, and worse still, amplified by the very people from whom we all expected the most steadfast support in this great transformation,” Sikka said in his letter.
He goes on to say that instead of focusing on value creating, a lot of Sikka’s own time has gone into this ‘distraction’.
“I hope that it gives everyone a chance to reflect, and give the transformation effort another big push and move the company forward rapidly to build its future, to build upon the foundation that we have laid over these past 3 years,” he adds.
He also said that if these types of attacks continue, he hopes the employees will be the voice of fairness and reason, and provide the company the kind of support it needs.
For the past couple of months, the founders of Infosys have been critical of how the company has been functioning under the new leadership. There were issues of corporate governance and also over compensation of Vishal Sikka and the former CFO.
Most recently, in an email dated August 9, Narayan Murthy wrote to some of his advisors talking about complaints about Sikka.
“All that I hear from at least three independent directors, including Mr Ravi Venkatesan (co-chairman), are complaints about Dr Sikka. They have told me umpteen times that Dr Sikka is not a CEO material but CTO material. This is the view of at least three members of the board, and not my view since I have not seen him operate from the vantage point of an Infosys board member,” Murthy said in the email.
According to a Mint report, he critisized the board for failing to uphold the company’s famed governance standards and not creating “checks and balances required in any well-run company”.