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3
April 2017
Infosys
founder N.R. Narayana Murthy on Sunday termed the board-approved compensation
hike for Chief Operating Officer U.B. Pravin Rao as "not proper" and
said it will "erode the trust and faith of the employees in the management
and the board".
In
an email, he also said that given the current poor governance standards at Infosys,
the targets for variable pay may not be adhered to if the board wants to favor
a top management person.
Murthy
said giving nearly 60% to 70% increase in compensation for a top level person
(even including performance-based variable pay) when the compensation for most
of the employees in the company was increased by just 6-8 per cent is "in
my opinion, not proper".
"This
is grossly unfair to the majority of the Infosys employees including project
managers, delivery managers, analysts, programmers, sales people in the field,
entry level engineers, clerks and office boys who are toiling hard to make the
company better. The impact of such a decision will likely erode the trust and
faith of the employees in the management and the board.
"With
what conscience, can a decent person like Pravin (a man schooled in Infosys
values for over 30 years) tell his juniors that they should work hard and make
sacrifice to reduce cost and protect margin? I have got so many mails from
these people asking whether this resolution is fair. No previous resolution in
the history of the company has received such a low approval," he added. The Total Investment & Insurance Solutions
Murthy,
however, said he has lots of affection for him. "I recruited Pravin in
1985 and had nurtured him throughout my stay at Infosys since then. He had been
sidelined. He was not even a member of the Executive Council at Infosys in 2013
when I came back. Kris, Shibu and I encouraged him, elevated him to the board,
and made him the COO when we recruited Vishal as the CEO. So, this abstention
has nothing to do with Pravin," he said.
"Those
of us who have always stood for fairness in compensation and practised it,
right from the day Infosys was founded, will have to demonstrate it when
needed. This is a time when it is needed. Nothing more and nothing less,"
he wrote.
Murthy
said he always believed in striving towards reducing differences in
compensation and equity in a corporation. The
Total Investment & Insurance Solutions
"You
may not know that my Infosys salary at the time of the founding of Infosys was
just 10% of my salary in my previous job. I ensured that my younger, co-founder
colleagues got 20% higher salary over their salaries in their previous job even
though I was 7 levels above them in my previous job and was 11 years older than
them.
"I
gave them huge equity compensation the like of which has never been replicated
in this world. So, this abstention comes from somebody who has walked the
talk," he said.
Murthy
said he always felt that every senior management person of an Indian
corporation has to show self-restraint in his or her compensation and
perquisites. "He or she has to fight for maintaining a reasonable ratio
between the lowest salary and the highest salary in a corporation in a poor
country like India. The board has to create a climate of opinion for such
fairness by their actions," he added. The
Total Investment & Insurance Solutions
"This
is necessary if we have to make compassionate capitalism acceptable to a
majority of Indians who are poor. Without compassionate capitalism, this
country cannot create jobs and solve the problem of poverty. Experts tell me
that capitalism may come to an end in the not-so-distant future if the current
corporate leaders do not heed this advice in India," he said.The Total Investment & Insurance Solutions
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