Infosys to pay Rs 34 lakh to Sebi as settlement of CFO case

Infosys to pay Rs 34 lakh to Sebi as settlement of CFO case

Bengaluru, Feb 19: Infosys will pay Rs 34.4 lakh to settle with market regulator Sebi on former CFO Rajiv Bansal’s severance pay case.
The settlement order says it was prima facie found that the severance payment was not in accordance with the company’s remuneration policy, that it was done without the approval of the Nomination and Remuneration Committee (NRC), and there was no prior approval of the audit committee for the severance agreement. All these were in violation of Sebi rules, the circular said. Sebi also said Infosys failed to make detailed and timely disclosure of the severance agreement, the cessation of the severance payment, and initiation of arbitration proceedings. The settlement order was passed on February 15.
Bansal was asked to go in 2015 by then CEO Vishal Sikka. Infosys at the time agreed to pay him Rs 17.4 crore as severance, the equivalent of 24 months’ pay. But the payment became controversial, with co-founder N R Narayana Murthy questioning in particular the high amount involved. It was also then said that proper procedures were not followed. Subsequently, Infosys disbursed only Rs 5 crore, and halted the remaining payment on the grounds that Bansal had not met some of his obligations.
The then board under the chairmanship of R Seshasayee admitted to lapses on the issue.
In 2017, Infosys submitted a settlement application with Sebi following the market regulator’s inquiry into the allegations about inadequate disclosures and procedural lapses. Infosys then said it wants to resolve the allegations about not seeking prior and separate approval of the NRC and the audit committee, as also in relation to disclosures pertaining to the severance agreement, cessation of severance payments, and initiation of arbitration under the severance agreement.