Infosys CEO Sikka defends performance, says focus should be on execution

Let us not get distracted by media speculation, he wrote in letter to employees

Infosys chief executive Vishal Sikka rallied the company's employees to focus on execution of the company's strategy and asked them to not get distracted on questions over commitment to governance, integrity and values of the organisation.

Sikka justified his business decisions saying that Infosys's performance matched industry performance from 50 per cent down two years ago and held margins through efficiency and automation, helping better cash flow generation.

"There is no second-guessing our deep commitment, passion and dedication to transforming this great company, even within the unprecedented new context that we find ourselves in. We are doing this. We will do this. Together!" wrote Sikka in an email to employees after founders raise red flags on governance and disclosure norms at Infosys. "Let us not get distracted by media speculation," he said.

The founders, investors and proxy advisory firms have raised concerns over severance packages to former chief financial officer Rajiv Bansal and chief compliance officer David Kennedy. There has also been concerns over the high compensation to Sikka and selection of board members D N Prahlad and Punita Sinha, which board member and Biocon chairman Kiran Mazumdar-Shaw has dismissed as issues that have been sorted.

"Nandan Nilekani and Mrs Sudha Murty voted on everything even though the others abstained (on some resolutions). But that is one year old news. All those motions were carried forward because the majority of the shareholders voted in favour," said Shaw in an interview "They did express their concerns like why have you given such a generous severance pay to Rajiv Bansal, or given such a generous remuneration to Vishal Sikka. But we answered all those questions."

Sikka, the first non-founder CEO of Infosys, has been among the first IT leaders to talk of disruption in the IT services industry due to automation and pricing pressure. The protectionist policies of Donald Trump in the US and Theresa May in the UK is also weighing on Sikka, who wrote "and now a new broader global context that will influence all of these things along the way."

Since taking over the top job in August 2014, Sikka has brought in changes, pushing employees to retrain in design thinking, brought in zero distance programme that engineers were utilised on projects better and increasingly adopted automation based businesses that focused on higher margins.

"While we should all be proud of these numbers, we must keep in mind that these results are but footprints, consequences, of our work. The short-term milestones are simply those, and they point to our progress on our longer-term path," he wrote.

Sikka said that Infosys's top 10 new software and services (Mana, Skava, Edge, Panaya, Cloud services, Cloud Migration, Mainframe Modernization, API economy, BI Renewal and Cyber Security) now produce more than $110M in quarterly revenue, from around "22 million in Q2 FY15, and seven of these did not even exist then."