An internal audit conducted at Coforge Ltd. has uncovered a significant lapse in corporate governance: the lowest rating received by former Chairman O.P. Bhatt in board evaluation reports was not disclosed or discussed with the company's Nomination and Remuneration Committee (NRC) or the full board.
Coforge clarified that this observation, made by the internal auditor, stemmed from a review of relevant governance processes. It was specifically noted that the manner in which evaluation findings were presented by the ex-Chairman to the NRC and the board did not cover all pertinent aspects and findings, particularly concerning his own evaluation category.
Audit Focus on Governance, Not Financials
The company emphasized that the inclusion of these reports within the internal audit's scope was strictly for reviewing governance processes. Coforge stated explicitly that this audit should not be misconstrued as a review of the company's financial statements, accounting policies, revenue, or profitability, and has no bearing on its financial or operational performance or business outlook.
O.P. Bhatt recently resigned from his position as Chairman, prompting Coforge to clarify that its audit review had identified certain concerns regarding how the Board Evaluation Report (BER) had been handled and presented to the board. Following Bhatt's departure, Vivek Sharma, a Non-Executive Independent Director, has been appointed as interim Chairperson until January 31, 2027.
Board Decisions Unanimous and Strategic
Despite the governance concerns, Coforge affirmed that its board has historically operated with close cooperation, with all business strategies and governance decisions receiving unanimous approval. This collaborative approach, the company noted, enabled expeditious decision-making on key initiatives. These strategic decisions included the divestment of the AdvantageGo business, the exit from the data center business, the acquisition of Encora, the execution of the Sabre contract, and the decision to exit the loss-making India Government business.