Vishal Sikka, CEO and managing director of Infosys, India’s second largest software exporter, has resigned.
The Board of Directors accepted the resignation of Mr. Sikka “effective immediately,” according to a statement issued by the company. Mr. Sikka has been appointed executive vice chairman effective Thursday and will hold office until a new permanent chief executive officer and managing director takes charge, which should be no later than March 31, 2018,according to the statement.
Mr. Sikka cited among his reasons for leaving “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,” according to the statement.
“The Board understands and acknowledges Dr. Sikka’s reasons for resignation, 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.”
Resignation letter of Vishal Sikka
N.R. Narayana Murthy, founder of Infosys, over the past couple of months, has raised issues of corporate governance and salary increases paid to Mr. Sikka and chief operating officer U. B. Pravin Rao. Mr. Murthy also wanted to make public a report on the investigations on buying Panaya for $200 million.
The Board understands and acknowledges Mr. Sikka’s reasons for resignation, and regrets his decision, the statement said.
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.
“As the Board has previously stated, a series of careful investigations found no merit to the unsubstantiated and anonymous allegations that had been asserted. The Board denounces the critics who have amplified and sought to further promote demonstrably false allegations which have harmed employee morale and contributed to the loss of the company’s valued CEO.”
R. Seshasayee, chairman of the board said: ”Vishal has made a seminal contribution to the transformation of Infosys, and he will be remembered for infusing a refreshed sense of direction, purpose, and energy in the organisation. His vision for the future of the industry and the company will remain a strong reference point as we chart the future course for Infosys in this new era in our rapidly evolving industry.”
The new Sikka at Infosys
Mr. Sikka will continue to focus on strategic initiatives, key customer relationships and technology development and Mr. Rao has been appointed interim chief executive officer and managing director reporting to Mr. Sikka under the overall supervision and control of the company’s Board, according to the statement.
Mr. Sikka will receive an annual salary of $1 during his tenure as executive vice chairman. Any company equity awards held by Mr. Sikka that remain outstanding and unvested shall, during his term as Executive vice chairman, remain outstanding and shall continue to vest (and, in the case of stock options, become exercisable) in accordance with their terms.
"I started my journey as the CEO of this iconic company with a mission to transform it on the basis of software, especially [artificial intelligence], and innovation, enabled by education,” Mr. Sikka said in the statement.
What next for Infosys?
“Three years later, I feel proud of our progress and achievements, from profitable revenue growth to rapid purposeful adoption of software, new services, and grassroots innovation, to the extraordinary recognition from our clients worldwide.
“I am deeply grateful to our Board for providing me with strong support and guidance, and especially wish to thank our chairman [Seshasayee] for his extraordinary and thoughtful stewardship, and look forward to working together on a smooth transition. Congratulations to my friend and partner Pravin on his appointment, and heartfelt thanks to all Infoscions for their warmth, amazing support and the sparks of their imagination."
The Board has mandated the chairman and the Nomination and Remuneration Committee to expeditiously identify and select a permanent CEO and managing director, according to the statement.
Ravi Venkatesan, co-chairman of the Board, said: "I want to thank Vishal for his commitment to ensure a smooth transition and his commitment to a seamless experience for our clients. Pravin is a veteran Infoscion with deep knowledge of the business, and his long experience in the company will help ensure a smooth transition."
In early trade,Infosys shares fell over 6.6% and was trading at ₹954 a piece.