Narayana Murthy questions big pay hike for Infosys COO Rao
03 April 2017
The dispute between founders and board of India's second-largest software services company Infosys over governance issues spilled into the public again as N Narayana Murthy, one of the co-founders, criticised a salary hike given to chief operating officer Pravin Rao.
In a letter published in full text by some dailies including Business Standard and The Economic Times, Murthy criticised the steep rise in Rao's salary.
"Giving nearly 60 per cent to 70 per cent 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 per cent to 8 per cent is, in my opinion, not proper. This is grossly unfair to the majority of the Infosys employees...," said Murthy in the letter.
"The impact of such a decision will likely erode the trust and faith of the employees in the management and the board," added Murthy.
According to a stock exchange filing by the company, only 24 per cent of promoter votes cast were in favour of a resolution seeking a 35-per cent rise in Rao's compensation, while the rest of the voters abstained.
The development comes after the company in February reassured investors and analysts it was not being distracted by a dispute with its founders over how the company was being managed.
The company's founders, who still own 12.75 per cent of the group, had earlier questioned the pay rise granted to chief executive Vishal Sikka and also the size of severance payouts given to others, including former finance head Rajiv Bansal (See: Top execs at Infosys being paid too much: Narayana Murthy).