This time, I got to listen NRN and Infy board members not as an employee but as a shareholder. It was exciting and one of a kind experience to attend an AGM. I recall the visit of CEO Mr. Gopalakrishnan’s in Infosys Bhubaneswar in year 2006. On asking a question on pileup of cash, Mr. Gopalakrishnan replied that such questions are asked in AGMs and not in employee Open Houses.
That day I decided that I would try and attend Infosys AGM one day. So this is how I ended up attending 29th Infosys AGM in Christ University Auditorium in Bangalore.I arrived and queued up for shareholder registration. All the registration counters were nicely put up. Senior citizens, Housewives and some long time shareholders were all exuding the confidence that loyal shareholders do.Opening speech was delivered by Chairman of Board, Mr. Murthy.
CFO Mr Balakrishnan’s presentation was innovatively done and kept the shareholders engaged with usage of imagery, music , Bollywood songs and videos.You can see Mr. Batni in Currency Avatram. CEO, CFO and COO’s promise that ALL is well. Infy’s conservatism and pride that they sit on 4 bn dollar cash during recession times was shown in NRN the king making a statement – “Cash is king” and Ever saw Mr. Pai in Avatar of Greek God.
So here it is presenting Mr Pai with IRFS highlights. While everything on screen was great, I could make some disturbing observations which goes on to explain poor corporate Governance in India and Lack of Shareholder activism. 1) As soon as announcement was made that there is an arrangement for High Tea, Half the auditorium got empty in no time which just shows how much shareholders care about AGM proceedings. It was an astonishing act.
Do shareholders come for fine dining or assessing performance of the board and keeping them accountable?
Do shareholders come for fine dining or assessing performance of the board and keeping them accountable?2. Shareholders kept either lauding the performance or cursing the board and the company without proper facts. Here are some ludicrous and disappointing instances.
a. You give a mike to a shareholder and rest assured that you can’t complete the meeting in allotted time. Shareholders were reading pages just to ask a single question
b. One shareholder was very upset with recruitment process- He questioned why do Infosys imposes requirement of 65% cutoff in exams. He suggested everyone should get an opportunity like UPSC exam to appear in a written test. He was asking this question during time reserved for accounting related queries.
c )Another Gentleman was speaking in non-stop Kannada. While perturbed, NRN interrupted and requested to put a stop at the lengthy speech instead ask a question but he was in no mood to listen to such trival request by chairman of the Board.
b. One shareholder was very upset with recruitment process- He questioned why do Infosys imposes requirement of 65% cutoff in exams. He suggested everyone should get an opportunity like UPSC exam to appear in a written test. He was asking this question during time reserved for accounting related queries.
c )Another Gentleman was speaking in non-stop Kannada. While perturbed, NRN interrupted and requested to put a stop at the lengthy speech instead ask a question but he was in no mood to listen to such trival request by chairman of the Board.d. Other shareholder complained on why don’t we conduct AGMs in Infosys campus? - Good request but is that question which really disturbs a shareholder?
Does he really have sleepless nights because of the venue and not what’s happening in Outsourcing industry, ROE and NPM margins, performance of independent board members and executives of the company?
Does he really have sleepless nights because of the venue and not what’s happening in Outsourcing industry, ROE and NPM margins, performance of independent board members and executives of the company?e. Other gentleman raised question of mismatch in remuneration and qualifications. How can BSCs and BEs make lakhs and crore in salaries?f. I have not got returns from Income tax department – One shareholder put forward his request. Don’t expect any strategic, deep insightful, analytical, razor sharp question, after all these shareholders are unaware, uninformed ordinary retail shareholders.
g. Axis Bank is not updating my passbook, why? – Why can’t shareholders not ask a question when they don’t know what and what not to ask?
g. Axis Bank is not updating my passbook, why? – Why can’t shareholders not ask a question when they don’t know what and what not to ask?
Other disturbing Facts:
1. Minimal presence of young shareholders and Infy employees: I thought many young shareholders would come considering Infosys being a new economy technology company and venue was in young city like Bangalore.
Had Even Infosys employees holding shares come, they would have made an impact by perhaps asking intelligent queries. It’s disturbing to note that even employee shareholders show little interest in health of the company.
Had Even Infosys employees holding shares come, they would have made an impact by perhaps asking intelligent queries. It’s disturbing to note that even employee shareholders show little interest in health of the company.
2. Non Participation by DII/FII and mutual funds: It didn’t seem that DII or FII (domestic/foreign institutional investors) and mutual funds bother to come to such gathering. Such investors could have made huge difference by keeping the board on their toes but sadly they hardly care to attend and make the difference. They anyways get the feed from company during analyst calls.
3. Any guesses for Family owned companies? If such is the state of investor participation, awareness and vigilance in an investor’s friendly, utterly professional company such as Infosys, It is anybody’s guess what must be state of affairs in family owned companies?
