KV Kamath, the man who built India’s second-largest bank, ICICI Bank, and who is now set to take over as non-executive chairman of India’s second-largest IT exporter, Infosys, will be compensated with an additional fee of around Rs 67 lakh for his new responsibilities.
Mr Kamath, 63, is replacing NR Narayana Murthy , the visionary founder of Infosys, as he retires in August in one of the major transitions the software exporter has undergone in its 30-yearold history. The fee is more than twice of what he got as non-executive chairman and board member of ICICI Bank in 2010-11.
Mr Kamath received a total of Rs 30.6 lakh, including a sitting fee ofRs 10.6 lakh, in ICICI, where in addition to being on the board, he is also on a number of committees such as the customer service and fraud.
In Infosys, Mr Kamath earned Rs 56 lakh in commission as a director in 2010-11. The ‘special fee’ of $150,000, or Rs 67 lakh, for the non-executive chairman has been recommended by the compensation committee of Infosys, in addition to his board fees. “The nominations committee on April 30, 2011, recommended the appointment of KV Kamath as the non-executive chairman of the board of directors with effect from August 21, 2011.
In this connection, the (compensation) committee has discussed and recommended to the board that, while serving in this role, KV Kamath as the non-executive chairman of the board be entitled to a special fee of $150,000 (over and above the regular board fee) per year for chairmanship of the board,” the company disclosed in its annual report. Mr Kamath, who also chairs the compensation committee, excused himself from these discussions.
He stands to get close to Rs 1.2 crore as fees for his duties as a director on the board and as the non-executive chairman of Infosys. An expert with a global firm, advising on board restructuring and compensation, said the fee being paid was in line with the current practice of paying professionals on the board a fee for utilising their special knowledge and experience beyond their role as board members.
“Organisations are no longer appointing people to the board without due thought. They are looking for people who can spend time with the company, share values, but not run the company,” he said.