Whistleblower complaints: Here’s what Amit Tandon of IiAS makes of the Infosys controversy

On Monday, Indian software services exporter Infosys said it received whistleblower complaints alleging "unethical practices" by its executives. The allegations are very serious given that the complaints centre on breach of corporate governance standards and accounting malpractices.

Amit Tandon, MD of Institutional Investor Advisory Services (IiAS) spoke at length about the latest happenings in Infosys. Tandon said that the market need not over-worry because of the allegations.

“There is little evidence at this stage to suggest that the cash flows have been severely affected. Therefore, we have to face it that accounting policies do change,” he said.

Here’s everything that we know about the Infosys whistleblower complaint and its potential impact

“The second thing they said is about client services; clients which have been acquired are not bottomline accretive, but my view is that you could be acquiring a client for a strategic reason. You might want to showcase them to the others and use that to win other businesses and then you have to look at it over a lifecycle,” Tandon further added.

Talking further about the charges levied, he said, “It’s something they had in the case of Vishal Sikka (former CEO of Infosys), which is that he is not spending enough time in Bengaluru as CEO, and they have levied the same charge against Salil Parekh.”

“In this day and age and for a company which is helping its clients go digital, I think it’s high time they get used to having a virtual CEO. There is no reason for the CEO to be present in Bengaluru on most days of the week. Finally, what goes into board agenda and that’s the fourth charge. I think it’s one person’s word against another. Therefore, I would say it’s a prerogative of the CEO in consultation with the chairman regarding what goes on the board agenda, Tandon added.

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“To my mind, the charges do not merit the kind of behaviour we have seen in the market. There is however one thing, the question to be asked is could they have disclosed this a bit earlier. At this moment it seems to be a reaction to what has happened in the market. Had they disclosed it in a timely manner I suspect the market would have taken it far more in its stride than scrambling around to find out whether there is any merit in any of these charges or not,” he reasoned.