Investors have said the latest missive from former Infosys chairman R Seshasayee who accused co-founder, NR Narayana Murthy, of personal attacks and slander could make it harder for the newly-appointed non-executive chairman Nandan Nilekani to keep the probe report on Panaya away from the shareholders for long.

“If the report is made public or not made public and Vishal Sikka and the earlier board are absolved from any wrongdoing, many institutional shareholders may question the necessity to rock the boat when things were stable on the operational front,” brokerage company Nirmal Bang said in a recent note to its investors. They are also likely to question the running battle between Murthy and members of the earlier board, Girish Pai, head of research wrote in the note.

Addressing his first press conference after taking over the new post, Nilekani had said that he would get a full briefing about the Panaya case and based on that an appropriate course of action will be decided.

The note also pointed out that while the induction of Nilekani was a positive step, it will take 12-18 months before the situation stabilises at Infosys. The note said Sikka’s office was handling the top 25-50 customers before he quit the company.

A signatory to a joint letter written by 80 former Infosys employees to the board recently, George Verghese told BusinessLine that it is important to make the probe report public in one form or the other, but even if nothing comes of it, Murthy’s reputation will not be harmed.

“He has just asked the facts to be made public and as a shareholder, he has every right to do so,” Verghese who is the co-founder and CEO of ET Marlabs, an IT solutions company, said.

Verghese and several other former Infosys top executives had in a recent letter criticised the board for blaming Murthy for the exit of Sikka. They said the issues raised by Murthy deserve a data-oriented response from the board with fact-based explanations.

Sujaya Banerjee, CEO of leading HR company, Capstone People Consulting, told BusinessLine that it is important to hold the leadership team to some decorum. “Such acts do not go down well with the employees and the shareholders. No one seems to be bothered about the reputation of the company,” Banerjee, who is a coach for CEOs and board members and advises companies on conducting board meetings effectively, said.

Pai of Nirmal Bang also said that it might be difficult to get an external candidate because of the current situation though Verghese felt that Nilekani’s presence in the company was good enough for outside candidates to find it attractive enough to bid for the CEO’s job.

New strategy

Pai pointed out that Nilekani has said that a refreshed strategy for the company will be revealed during the October 2017 quarterly results. Hence, a lot of hard work needs to be carried out to convince the clients and for execution of the new strategy.

“We believe the composition of the board is secondary, and the only issue that investors should be interested in is whether, with the new set up, Infosys can deliver industry-leading performance on most parameters,” Pai said in the note.

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