Narayana Murthy expresses regret over not rewarding early Infosys employees adequately

Infosys founder Narayana Murthy has expressed regret for not rewarding many of the tech firm’s early employees whose contributions he said were more than his. During a book launch event, the tech pioneer said there were several “extremely smart early adopters” of Infosys to whom he could not award the kind of stock he gave to his co-founders. “Their contribution was more or as much as mine,” said Murthy, who founded Infosys along with six engineers in 1981.

The veteran entrepreneur said he should have thought about it carefully. “Those extraordinary people too would have benefitted,” he said. This came over a month after Murthy said he regretted his decision to keep his family out of Infosys. Murthy co-founded Infosys with Rs 10,000, which was given by his wife Sudha Murty. But when she expressed her desire to join Infosys, Murthy said no.

“I think what I was doing those days was wrong. I was wrongly idealistic. And in some way, I was influenced a lot by the environment of those days,” Murthy said last month while speaking with CNBC-TV18’s Shereen Bhan.

Also read: ‘I was wrongly idealistic’: Narayana Murthy says he was wrong in not allowing his wife Sudha Murty to join Infosys

Infosys was founded in Pune, but two years later in 1983, its headquarters was relocated to Bengaluru. A decade later, Infosys launched Employee Stock Options (ESOP), under which the co-founders were given company stocks. The other co-founders were Nandan Nilekani, Kris Gopalakrishnan, SD Shibulal, K Dinesh, NS Raghavan, and Ashok Arora.

In November 1999, India Today Magazine reported that Murthy and the five other Infosys founder-directors held between themselves about 30 per cent of the company’s shares, which were then valued at Rs 7,425 crore.

The wealth was percolating down to the army of young employees ‘through a series of employees’ stock option plans since 1994. Of the 4,782 employees, lovingly addressed as “Infoscions”, 1,667 held ESOP. Of them, 1,376 had stock valued at over Rs 10 lakh each. Among them, the total number of the jeans-clad “crorepatis” was a staggering 412.

And 97 of them had left the Rs 1 crore milestone far behind, having become dollar millionaires (Rs 4.3 crore-plus) by age 30-35. No other company in India, not even Infosys’ software rivals Wipro Ltd and Satyam Computers, had shared its wealth with such a large number of employees.

Also read: Infosys co-founder SD Shibulal’s son, daughter-in-law sell shares worth Rs 436 crore

In October last year, Infosys co-founder SD Shibulal’s son and daughter-in-law sold Infy shares worth Rs 436 crore. Shreyas Shibulal sold 23,70,435 shares at Rs 1,433.51 apiece, amounting to Rs 339.80 crore. He owned 2,37,04,350 shares or 0.64 per cent stake in Infosys before the stake sale. The shares he sold accounted for 0.06 per cent stake in the company. Post the stake sale, Shreyas is left with 0.58 per cent stake, or 2,13,33,915 shares, in the company.

In November 2022, Capital, which tracks the market, shared a list of the largest shareholders of Infosys among insiders. As per the list, Nandan Nilekani the list with 100,461,168 shares, followed by Salil Parekh (770,481 shares), Mohit Joshi (304,353 shares), Inderpreet Sawhney (149,673 shares), and Krishnamurthy Shankar (113,869 shares).

On Wednesday, shares of Infosys declined 1.10 per cent to settle at Rs 1,666 on the BSE