Synopsis
Infosys board members are set to discuss leadership changes. Current CEO Salil Parekh's term concludes soon. A two-year extension is anticipated to manage succession planning. This transition is crucial for maintaining stability amid industry disruptions. Investors are closely monitoring the situation for future leadership.Listen to this article in summarized format
Parekh’s current five-year term as chief executive ends in March 2027, and he would likely receive an extension of two years, one of the sources cited above told ET. The normal retirement age at Infosys is 60. “I don’t think there can be more than a twoyear extension. The extension will be used to run and manage a succession plan,” said the person cited immediately above. “Parekh’s term was very stable and the company wants to avoid the kind of management upheaval that came with previous CEO changes.” The market capitalisation of Infosys, currently at Rs 5.44 lakh crore, has surged more than two and a half times under Parekh’s watch.
Parekh and Infosys Chairman Nandan Nilekani did not respond to messages seeking their comments on a clarification sent on Monday. Infosys, which is in its silent period ahead of Q4 earnings, did not respond to ET's email seeking comments.
A smooth management change is crucial for Infosys, as it already faces AI-spawned disruptions that have caused stock valuations to fall more than a quarter from their peaks.
In 2014, when founder NR Narayana Murthy returned to the company, Infosys lost a slew of top talent, as it was clear the company was looking for an external executive. When Vishal Sikka joined the company, his induction of top officials from Silicon Valley also resulted in the exodus of talent at Infosys.
"Parekh's tenure brought a lot of stability to Infosys. He worked with Nilekani very closely to deal with the overhang of the Sikka years. Keeping that stability is important for everyone," a second source told ET.
Infosys' management change is being closely watched across the industry and by investors. In meetings with 30 Asian Investors, including hedge funds and other institutions, brokerage BNP Paribas said this issue was at the top of mind when it came to investing in Infosys shares.
"The winding down of the Daimler deal and potential CEO transition are some of the key concerns investors had on Infosys," Kumar Rakesh, analyst, BNP Paribas, said in a recent IT sector report.
