Infosys Says Not Guilty In Whistleblowing Case, No Evidence Found; Shares Jump By 5%
The news got a jump in Infosys shares in noon trade by 6%.
What Is The Current Status On The Complaint?
The company informed that the anonymous complaints are still under investigation and they are yet to receive any evidence to corroborate whistleblower complaints against top executives.
They said that “With respect to the anonymous complaints, there is no prima facie evidence that the company has received until date to corroborate any of the allegations made. In any event, the Audit Committee retained the services of the law firm, Shardul Amarchand Mangaldas & Co. to investigate the matter,”.
Is The Complaint Correct?
Although the company informed that the anonymous complaints are still under investigation and the said “company is not in a position to determine the concreteness, credibility and materiality of the anonymous complaints.”
The IT major also assured that they will “update the stock exchanges on the basis of key findings of the investigation reports once these are concluded.”
What Does The Market Expert Say?
Sandip Sabharwal, a market expert said in a tweet “Infosys gives a strong rebuttal to the allegations of the so called “Whistleblower”. I would go by the credibility of the Infosys Board rather than an unknown, possibly disgruntled set of employees,”.
Earlier the IT companies shares seen a decline after the Indian software services exporter had announced that it had received whistleblower complaints against company’s executives, alleging “unethical practices” last month.
As per the company’s practice, the whistleblower complaints have been placed before the audit committee.
According to Infosys, It will be dealt with in accordance with the company’s whistleblowers policy.
How Does The Investigation Work Going On?
The chairman Nandan Nilekani informed the stock exchanges that CEO and CFO have been recused from this proceeding to ensure the independence in these investigations.
The company also informed that on the basis of the allegations in the anonymous complaints, the independent internal auditors were given a mandate to review certain processes.
In October, the leading stock exchange BSE demanded an explanation from Infosys to why it did not make a disclosure about a whistleblower complaint which alleged that the company’s top executives were following “unethical practices” to shore up profits through irregular accounting ways.
The whistleblower complaint lead to a strong quarterly earnings performance by Infosys, which increased the lower end of its annual revenue forecast on upbeat demand for its digital services.