After coming in for some serious questioning on salary paid to the senior leadership of Infosys, the company has clarified in a statement sent to the exchanges.
The company said that Pravin Rao's compensation revision reflects the philosophy of aligning the interests of its leadership team to the company's long term shareholder interests.
"While the breakup of Mr. Pravin Rao's compensation has been provided in the postal ballot, it is relevant to note the following: The cash component of his compensation has decreased from Rs. 5.2 crores (including annual cash bonus) to Rs. 4.6 crores, a decrease of 10.6%. The performance based component of the compensation (directly linked to company and individual performance) has been increased from 45% to 63% of total compensation. Given the 4 year vesting period of stock, the net increase in Mr. Pravin Rao's compensation for FY 18 will be 1.4%. This could go up to 33.4% in year 4, assuming similar grants are made in subsequent years based on Company and individual performance," the company said.
Referring to Mr. Rao's compensation revision, Dr. Vishal Sikka, Chief Executive Officer said, "Pravin's commitment and contribution to the company has been immense, and his partnership over the past 3 years has been critical to the successes and growth of our company. It is essential for us to see that this revision in his compensation, as with several of our senior leadership team, is focused on making Infosys more competitive, is benchmarked against peers, is critical for us to retain key talent and aligns the long term interests of our leadership team with that of our shareholders."
The revised compensation proposal was placed before the shareholders and the recommendations have been approved by 67% of the company's shareholders in a postal ballot, the results of which were disclosed to the stock exchanges on Saturday, April 1, 2017. The Infosys Board would like to state that it acknowledges the sentiments of shareholders who have not voted in favor of the resolution, and has also taken careful note of the statements expressed by the company's promoters. This Board views this as important feedback as it continues to work.