Bobby Parikh, who was appointed a board member of Infosys Ltd just a month back, finds himself in a controversy with the firm’s audit committee imposing a fine of Rs 2 lakh on him for an “inadvertent” trade.
Infosys notified the stock exchanges on this inadvertent trading by a designated person.
Infosys said in the filing that the portfolio management services of Bela Parikh, spouse of Bobby Parikh, an Independent Director of the Company, had bought 2,754 shares during the open trading window period without the knowledge of Bobby Parikh and without obtaining pre-clearance of trade.
“Bobby Parikh is the joint holder of that account. Mr Parikh has confirmed that he was not in possession of any Unpublished Price Sensitive Information (UPSI)”, Infosys said.
The Audit Committee of Infosys was notified of this matter. “Based on Mr Parikh’s submission, the Audit Committee has concluded that this was an inadvertent trade made without intent to violate the Company’s insider trading Policy or the SEBI (Prohibition of Insider Trading) Regulations, 2015 (PIT Regulations),” Infosys said.
“However, the Audit Committee has determined that there was a violation of the company’s policy and PIT Regulations and has therefore imposed on Mr Parikh, a penalty of Rs 2,00,000 which amount shall be remitted to Investor Protection Education Fund (IPEF) in line with the PIT Regulations,” Infosys said.
The incident has received attention as Infosys is seen as a torch-bearer of corporate governance in the corporate sector.
Parikh was appointed as an Independent Director of Infosys effective July 15, 2020, based on the recommendations of the Nomination and Remuneration Committee of the Board.
The Managing Partner of Bobby Parikh Associates, a boutique firm focused on providing strategic tax and regulatory advisory services, he is a former Chief Executive Officer of Ernst and Young in India and held that responsibility until December 2003.
As per a company statement, welcoming Parikh to the Board, Kiran Mazumdar-Shaw, Lead Independent Director and Chairperson of the Nomination and Remuneration Committee said: “Bobby Parikh is a well-respected business leader who brings a wealth of experience and financial acumen to the Infosys Board. His vast experience in the realm of corporate governance will greatly benefit the Company.”