Infosys gave a low key welcome to Parekh, unlike the aggressive marketing exercise it undertook to welcome Sikka
Salil Parekh will earn an annual salary of Rs 162. 5 million ($ 2.55 million) as the CEO of Infosys, which is a quarter of what Infosys had signed up with his high profile predecessor Vishal Sikka, who quit the firm after three years in turmoil.
The compensation also reflects the reality at Infosys and its chairman Nandan Nilekani who would like the low profile senior executive to execute a vision of focused delivery for customers than over promise and under delivery that would be in contrast with the company’s culture.
Parekh, the soft-spoken executive who was poached from global rival Capgemini, will get an annual fixed salary of Rs 65 million and variable pay of Rs 97.5 million that would be compensated based on achieving metrics set by the company. Infosys has also offered stock options worth Rs 97.5 million that would be vested over two years, the company said in its postal ballot that was disclosed in regulatory filings. Pravin Rao, interim MD and CEO has been redesignated as COO.
Sikka, who had a tumultuous three-year stint at Infosys, had signed up $ 11 million package including stock options. However, in fiscal 2017, the last of the three-year term, Sikka earned Rs 451 million ($ 7 million), after he struggled to grow business faster in a volatile business environment and the battle he was facing internally with the entrenched system at Infosys.
Infosys has also spelt out the severance pay terms – half his compensation of the previous 12 months and vesting of outstanding stock options till that period.
The severance pay to Rajiv Bansal, the former CFO, ten times his annual compensation, sparked a controversy over alleged failure in corporate governance norms, which eventually brought the downfall of Sikka and R Seshasayee, the former Chairman at Infosys.
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