Human

Resource
Manageme
nt

1|Page
 Project
On
Ethical Issues in
HRM
2|Page
Prof Guide. _____________

Acknowledgemen
t
It was an immensely pleasurable experience in working on
this project on the topic of, “Human Resource Management”

3|Page
due to which i got the opportunities to gain knowledge which
enhanced our skills.
However, my efforts alone could not have been sufficient for
completion of this project.
Invaluable advice & suggestion from large number of people
have gone into this project. I am extremely grateful to all those
people who have helped us in collecting valuable information
& helping us in completion of this project. The foremost
among them is our Prof. Guide ________________________ whose
constant corrective guidance & motivation enabled a focused
effort towards completion of the project.

Thank You Sir!!!!

Synopsis
Sr. Topic Page
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# #
1 Introduction to Ethics 6
2 Ethical Issues in HRM 8
3 Ethical issues in Business 14
4 Infosys (Company details) 16
5 History 18
6 HRM at Infosys 21
7 HRD at Infosys 22
8 Employee Health Indicator 24
9 Retention Of Employee 26
10 Training Programs at Infosys 28
11 Case I ,II & III 30-
36
12 Bibliography 38

Introduction
What is ethics?

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Ethics refers to the concept of what is right and wrong, moral
and immoral. Ethical behavior is generally considered behavior
that is in line with the accepted moral code, and that is proper.
Unfortunately, however, there is not one clear answer to what is
ethics or what is ethical, because both morality and ethics and
relative terms.

What is Business Ethics?

Business ethics is the behavior that a business adheres to in its
daily dealings with the world. The ethics of a particular business
can be diverse. They apply not only to how the business interacts

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with the world at large, but also to their one-on-one dealings
with a single customer.

Many businesses have gained a bad reputation just by being in

business. To some people, businesses are interested in making
money, and that is the bottom line. It could be
called capitalism in its purest form. Making money is not wrong
in itself. It is the manner in which some businesses conduct
themselves that brings up the question of ethical behavior.

Good business ethics should be a part of every business. There

are many factors to consider. When a company does business
with another that is considered unethical, does this make the
first company unethical by association? Some people would say
yes, the first business has a responsibility and it is now a link in
the chain of unethical businesses.

Many global businesses, including most of the major brands that

the public use, can be seen not to think too highly of good
business ethics. Many major brands have been fined millions for
breaking ethical business laws. Money is the major deciding
factor.

If a company does not adhere to business ethics and breaks the

laws, they usually end up being fined. Many companies have
broken anti-trust, ethical and environmental laws and received
fines worth millions. The problem is that the amount of money
these companies are making outweighs the fines applied. Billion
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dollar profits blind the companies to their lack of business ethics,
and the dollar sign wins.

A business may be a multi-million seller, but does it use

good business ethics and do people care? There are popular sof
drinks and fast food restaurants that have been fined time and
time again for unethical behavior.

Ethical Issues in
HRM
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Ethical issues abound in HR activities. Areas of ethical
misconduct in the personnel function include employment,
remuneration and benefits, labor relations, health and safety,
training and development, and HRIS (hr ethical issues)

Elaboration:-

Cash and incentives plans:-

This includes base salaries, incentive plans, long term incentive
plans, executive perquisites, and separation annual agreements.

Base salaries -

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The HR function is ofen presumed to justify a higher level of
base salaries, or a higher percentage increase than what
competitive practice calls for. In some cases, pressure is exerted
to re-evaluate the position to a higher grade for the purpose of
justifying a larger than normal increase.

Annual incentive plan –

The HR manager is ofen forced to design and administer top-
management incentive plans, at higher rates than what the
individuals deserve. A common rationale presented to the HR
executive for bending the rules is the fear of losing the
outstanding executives, if higher incentives are not paid.

Long-term incentive plan -

Just as with annual incentive plan, many HR executives have the
responsibility of designing and administering the firm’s long term
incentive plans, but in consultation with CEO and an external
consultant. Ethical issues arise when the HR executive is put to
pressure to favor top management interests over those of other
employee’s investors.

Executive perquisites -
Executive perquisites make the ethical standard of the HR
executive difficult because their cost is ofen out of proportion to
the value added. For example a story relates to Bangalore –
based, losing making public sector undertaking who CEO spends
20 lakhs to get swimming pool built at his residence

Performance Appraisal -
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Performance appraisal lends itself to ethical issues. Assessment
of an individual’s performance is based on observation and
judgment. HR manager are expected to observe the performance
in order to judge its effectiveness. Ethics should be the
cornerstone of performance evaluation, and the overall objective
of high ethical performance reviews should to provide an honest
assessment of the performance and mutually develops a plan to
improve the rate’s effectiveness.

Race, Gender, Age, and Disability –

The practice of treatment of employees according to their race,
ethnic origin, sex, or disability has largely been stopped. A
framework of laws and regulations ahsevolved that has
significantly improved work place behavior. No enterprise today
dare to publicly state it denies minorities, woman, and the
disable opportunities for employment, remuneration, and
growth prospects different from those given to others.

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 In this environment the role of HR
function is to:

 Monitor the principles and norms of the enterprise to ensure

that they reflect the values of the society as expressed in its
law.

 Monitor the selection, rewards, development and, the appraisal

system to ensure that they are consistent with the principles
and norms.

 Vigorously pursue violations and, when necessary, vigorously

work to defend the enterprise against unfounded allegations.

Other Issues related are:-

Employment Issues
While discrimination and harassment situation receives mort
publicity, HR practitioners are more likely to face ethical
dilemmas in the areas of employee hiring. One challenge
commonly encountered is pressure to hire a relative o a friend of
a highly placed executive. Another area related to employment is
that of faked credentials submitted by a job applicant. While
discovery of this kind of fabrication usually leads to termination
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of the employment, the choice becomes difficult when the
applicant has a blend of skills set and a proven track record with
his or her previous employers.
Privacy issues
Privacy issues to protecting a person’s private life from intrusive
and unwarranted actions. The employee believes that his or her
religious, political, and social believes as well as personal life
style are private matters and should be safe guarded from being
snooped or analyzed. Exceptions are permitted grudgingly only
when job involvement is clearly involved. For example, it may not
be inappropriate to intrude into an employee’s private matter if
it is suspected that he or she discusses with competitor, through
email messages, the specification of newly developed product
not yet launched into the market.

Safety and health

Much of the industrial work is hazardous. This is because of the
extensive use of high speed and noisy machinery, production
processes requiring high temperature, an increasing reliance on
chemical compounds .Accidents, injuries and illnesses are likely
to occur under these circumstances. Over past decade, new
categories of accident and illness have emerged, including the
fast growing job safety problem of office injuries.

Restructuring and Layoffs

Restructuring and consequent layoffs have become relevant
because of poor management, but incompetence does not
become unethical. There are ethical implications in the process
by which termination decisions are made and actions taken. For

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example if restructuring requires closing a plant , the process by
which that plant is chosen ,how the news will be communicated,
and the time frame for completing the layoffs are ethically
important .If conducted in an atmosphere of fairness and equity
and with dignity of the affected individuals in mind, the action is
ethical.

Ethical Dilemmas
Several ethical dilemmas comfort an HR manager. The ethical
dilemmas arise from three sources-faces to face ethics, policy
ethics, and functional area ethics.

Face to face ethics

These arise mainly because there is a human element in most
business transactions. Business is composed of this human
transaction; it should not be surprising that face to face ethical
dilemmas arise ofen. It is likely that the quality assurance man
overlooks minor defects and approves a lot delivered by a
supplier because of the personal relationship that the two enjoy.

Corporate policy ethics

Companies are ofen faced with ethical dilemmas that affect
their operations across all departments and divisions. The
consequences of employment contraction in labor intensive
basic industries because of the improved methods of
production .Modern technology has replaced older methods of
production which has in turn resulted in hundreds being jobless.
The ethical burden of deciding corporate policy matters normally
rests upon a company’s HR management. The Hr manager and

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directors are responsible for making policies and implementing
them too. The ethical content of their policies can have
enormous impact throughout the company. It can set an ethical
tone and send right signals to all employees as well as external
stakeholder.

Functional area Ethics

Functional area of a business is likely to comfort ethical issues.
Accounting is a critical function of any business. Accounting
statements reveals to the manager and owner the financial
soundness of a company. Managers, investors, regulating
agencies, tax collectors and trade unions rely on accounting data
to make decisions. Honesty, integrity accuracy are absolute
requirements of the accounting functions. Account standard
ensure a high level of honest an ethical accounting disclosure.
Ethical dilemmas crop up in purchasing departments where
strong pressure is to obtain the lowest possible prizes from
suppliers and where too felt similar need it bag lucrative
contracts. Bribes, kickbacks, and discriminating pricing are
temptation to both parties.

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 Ethical issues in
business

Ethical issues arising from the nature of markets:-

- The 18th Century economist Adam Smith demonstrated how in
a free market the self interest of producers and consumers will
produce an outcome desirable to all concerned
- But the market can also lead to inequality of income, wealth
and market power:

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  Monopoly suppliers can exploit consumers
 Monophony buyers can exploit supply firms
 Worldwide inequality of income can result in unethical
practices such as the child labor

What is an Ethical code?

This is a set of principles governing morality and acceptable
behaviour

It is likely to cover:

 Personal behaviour e.g. when dealing with customers and

suppliers
 Corporate behaviour e.g. when negotiating deals
 Behaviour towards society e.g. when recruiting
 Behaviour towards the environment e.g. when deciding on
process

Ethical audit

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 This is an audit of all the firms’ activities

Purpose:
 To check that ethical principles are being pursued
 To check the extent to which actions are consistent with the

organization’s stated ethical intentions And to establish action

plans if they are not.

Infosys Technologies Ltd. (NASDAQ: INFY) was started in 1981 by

seven people with US$ 250. Today, we are a global leader in the
"next generation" of IT and consulting with revenues of over US$
4.8 billion (FY 10).
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Infosys defines, designs and delivers technology-enabled
business solutions that help Global 2000 companies win in a Flat
World. Infosys also provides a complete range of services by
leveraging our domain and business expertise and strategic
alliances with leading technology providers.

Our offerings span business and technology consulting,

application services, systems integration, product engineering,
custom sofware development, maintenance, re-engineering,
independent testing and validation services, IT infrastructure
services and business process outsourcing.

Infosys pioneered the Global Delivery Model (GDM), which

emerged as a disruptive force in the industry leading to the rise
of offshore outsourcing. The GDM is based on the principle of
taking work to the location where the best talent is available,
where it makes the best economic sense, with the least amount
of acceptable risk.

Infosys has a global footprint with 63 offices and development

centers in India, China, Australia, the Czech Republic, Poland, the
UK, Canada and Japan. Infosys and its subsidiaries have 114,822
employees as on June 30, 2010.

Infosys takes pride in building strategic long-term client

relationships. Over 97% of our revenues come from existing
customers (FY 10).

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 History
Established in 1981, Infosys is a NASDAQ listed global consulting
and IT services company with more than 114,000 employees.
From a capital of US$ 250, Infosys have grown to become a US$
4.8 billion company with a market capitalization of approximately
US$ 33 billion.

In our journey of over 29 years, we have catalyzed some of the

major changes that have led to India's emergence as the global
destination for sofware services talent. We pioneered the Global
Delivery Model and became the first IT company from India to be
listed on NASDAQ. Our employee stock options program created
some of India's first salaried millionaires.

 Milestones Achieved -
2009

 Infosys selected as a member of The Global Dow

 Employee strength grows to over 100,000

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 2008

 Infosys crosses revenues of US$ $ 4.18 billion

 Annual net profits cross US$ 1 billion

2007

 Infosys crosses revenues of US$ 3 billion. Employees

grow to over 70,000+
 Kris Gopalakrishnan, COO, takes over as CEO. Nandan M.
Nilekani is appointed Co-Chairman of the Board of Directors
 Opens new subsidiary in Latin America
 Reports Q2 revenue of over US$ 1billion

2006

 Infosys celebrates 25 years. Revenues cross US$ 2

billion. Employees grow to 50,000+
 N. R. Narayana Murthy retires from the services of the
company on turning 60. The Board of Directors
appoints him as an Additional Director. He continues as
Chairman and Chief Mentor of Infosys

2005

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  Records the largest international equity offering of US$
1 billion from India
 Selected to the Global MAKE Hall of Fame

2004

 Revenues reach US$ 1 billion

 Infosys Consulting Inc. is launched

2003

 Establishes subsidiaries in China and Australia

 Expands operations in Pune and China, and sets up a
Development Center in Thiruvananthapuram

2002

 Touches revenues of US$ 500 million

 Nandan M. Nilekani takes over as CEO from N.R.
Narayana Murthy, who is appointed Chairman and
Chief Mentor
 Opens offices in The Netherlands, Singapore and
Switzerland
 Sponsors secondary ADS offering

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  Infosys and the Wharton School of the University of
Pennsylvania set up The Wharton Infosys Business
Transformation Awards (WIBTA)
 Launches Progeon, offering business process
outsourcing services.

2001

 Touches revenues of US$ 400 million. Opens offices in

UAE and Argentina, and a Development Center in
Japan
 N. R. Narayana Murthy is rated among Time
Magazine/CNN's 25 most influential businessmen in
the world
 Infosys is rated as the Best Employer by Business
World/Hewitt

2000

 Touches revenues of US$ 200 million

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  Opens offices in France and Hong Kong, a global
development center in Canada and UK, and three
development centers in the US

Human Resource
Management at
Infosys
 Infosys currently has 1.13 lakh employees compared to 1.04
lakh same period last year.
 The company recruited around 9,300 people this quarter (net
addition of 3,914). Hiring outlook for the next year is
projected to be around 30,000 people, including 19,000
campus hires, 5,500 laterals, 2,000 overseas hires (in China,
Manila, the US and Europe) and the rest for Infosys BPO.

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 The attrition level stood at 13.4 per cent as of March 2010
compared to 11.6 per cent in the previous quarter and at 11.1
per cent during the same period last year. About 4,500 people
moved out of the organisation in the last quarter

 Infosys spend close to Rs 590 crore for salary hikes and

promotions. The increments would range between 13 per
cent and 17 per cent for junior to mid-levels and about 10 per
cent for senior leaders, he said.

 Overseas employees (onshore) would see a two-three per

cent increase in their salaries. The incremental impact on
margins would be around three per cent.

 Infosys has created history once again in the human resource

area with a “The incremental cost because of this exercise will
be about $134 million, the largest in the IT industry in India so
far,” said Mr T. V. Mohandas Pai, member of the Board and
Head, HRD and Education and Research, Infosys.

HRD at Infosys
Introduction of i-Race -
iRace - Infosys Role and Career Enhancement -
was introduced in October 2009. It was an
extremely large and complex exercise in which

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24 career streams were created. Around 65 managers had
worked on it for 18 months. The only way Infosys could have
done it was during the slowdown because such a thing would not
have been possible during a normal day.
Infosys needed to create career streams where growth can be no
longer defined by movement up. In this war for talent, Indian
companies have been promising promotion in every two years.
But employees continue to do the same job - they get a new
designation, new salary, new compensation, this is tricking the
person.
In actual terms, a change of job and a promotion means that one
is doing something else, something which is more complex and
at least 50 per cent different than what one was doing before.
This is compulsory for all employees. We did not provide such a
choice. Because this is a technology company, you should work
on technology. Earlier we used to allow a four-five year old to
become a project manager, today we will not.
One has to understand that when there is growth, there is more
number of promotions; it is not because you are being
promoted, but it is because the company needs more jobs. In
slowdown number of jobs that opened up was lesser, but people
misunderstood it to be due to iRace.

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I Race & its relation to clients &
pricing
Employees are important stakeholder in any initiative as
ultimately they are the ones who would get impacted and will
have to drive the initiative. So employee aspiration is taken and
given due note in the whole career path making of iRace.
The point why Infosys introduced it is because skill is becoming a
commodity and pricing is continuously being questioned. The
company is meant for the clients.
For the last few years clients have been complaining about lack
of technically strong people. Indian companies have been
continuing to get their people very quickly into people
management. As a result, a person works on technology for just
four to five year and then moves up to management.
Customers want a ten-year experienced technical person, and we
are providing them a three-year old, which they can get in the
US. So through iRace, Infosys intend to give you high value at
work, high technology at work for better pricing

Employee Health
Indicators

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The HRD constantly worked on mapping the employee health
indicators and we see that Infosys continues to be the most
sought-afer company. In one of the surveys, we were rated as
India's "best company to work for.”

At Infosys, retention age is very high, so one would find a lot of

old-timers. The average retention age at Infosys is five to six
years, which is one of the highest in our industry, and they stay
because they believe in Infosys.

Millions of resumes continue to float in every year for all levels.

In campus, it had 93 per cent conversion of the offers.
If about 60 per cent of the work force comes from campus,
around 25-26 per cent of the employees comprise the people
working with Infosys for more than 10-12 years. This number has
not changed over many years.

This is not only because of the name Infosys, but also because of
the diverse career options, like in product line, innovation,
research.

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 Retention of
employees
The challenge is in retaining the people of working age group of
three to five years because they are the most marketable and
booming. It is natural for them to get attracted to outside offers.
The only way companies can attract them is through different
career streams, value addition and compensation. And it not only
goes to competition, but also that the same group that goes for
higher education. Our first quarter attrition rate is therefore
higher than throughout the year.

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Infosys also have right retention plan, for the employees. It
ensures that the value of employees resume increases by 50-60
per cent year-on-year, by staying in the company. And in terms of
compensation it provides industry best long-term bonus for
senior levels. It has mostly seen that the attrition rate of people
working on specialized and rare skills, that are very much
marketable in the industry, is very low than the industry average.
It is as much as six percent, similar is the number of Infosys high
performers attrition.
Infosys spend close to Rs 590 crore for salary hikes and
promotions. The increments would range between 13 per cent
and 17 per cent for junior to mid-levels and about 10 per cent for
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senior leaders, he said. Overseas employees (onshore) would see
a two-three per cent increase in their salaries. The incremental
impact on margins would be around three per cent.

Till 2004, we were largely operating in application maintenances

business. Today this segment accounts for just 48 per cent of the
overall business; the rest is all new lines of businesses, like
consulting, enterprise solution, system integration, products. So
people have more options - both on-site and off-site. So we have
diverse options for people looking for career movements.

Training Programs in
Infosys
The spirit of learn ability among our people and an organizational
commitment to continuous personal and professional
development keeps Infosys at the forefront in a fast-changing
industry. Our framework for continuous learning at Infosys is
built around a number of focused programs for our employees.
These range from major initiatives such as the Infosys Leadership
Institute to various ongoing management development and

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personal improvement programs. They complement a host of
technology advancement and ongoing training options.

The training plan provides a sequence of inputs as individuals

grow through their professional career. Commencing with a
structured induction at the beginning to leadership trainings
while assuming senior responsibilities.
Training and development initiatives are available at each
milestone and cover the following-
 Technical training by Education & Research department:

We have an entry-level technical training program, which is

for duration of 14 weeks. This program has been certified by
educationists as being equivalent to a BS program in the US.

 Quality Process Training:

Infosys has a strong focus on quality processes and

methodologies. This training is tailored to the role that one is

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 playing i.e. Sofware Engineer, Programmer Analyst, and
Project Managers etc

 Personal Effectiveness and Managerial Programs:

Programs to enhance the managerial capabilities and

leadership abilities, to enable better customer satisfaction,
achieve organizational vision and create high performing
multicultural teams.

 ILI: The Infosys Leadership System:

The Infosys Leadership System (ILS) and the Infosys

Leadership Institute (ILI) address the issue of sustained
growth in general and creates a formal and committed system
for developing leadership capabilities in Info scions. The most
significant attribute of the Infosys leadership development
model is its partnership approach with the other groups in
Infosys and the ownership of the entire process by the top
management in what is termed as the ‘Internal Synergy
Model’.

The education philosophy at Infosys has been to equip the

participants with the know-how to find the best solution,
rather than to teach ‘one way to do it’ and also to relate to
real life situations We also encourage employees to go in for
further part time and distance education programs with fee
reimbursement subject to eligibility criteria laid down by the
policy.

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 Sustainability in
Infosys
Infosys began its journey in India's business environment in the
1980s, in an era when endless red tape was imposed on the
private sector. In this environment, building a company whose
long-term objectives included operational longevity, high ethical
standards and global respect demanded commitment to a core
set of values. For Infosys, these values focus on instilling trust in

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 our relationships with all stakeholders, including employees,
investors, clients, society and the communities in which Infosys
operates.
 At Infosys, we believe that we must develop trust with the
communities in which we operate to achieve longevity as a
corporation. Through the Infosys Foundation, which receives a
grant every year from Infosys (the last year's grant was US$ 3
million) we contribute to betterment of healthcare (hospitals,
infrastructure), education (books, scholarships, refurbishment of
infrastructure) and skills
 With employees from over 70 nationalities, Infosys has built
an enduring value system based on openness, honesty, fairness
and transparency, which has earned us the confidence and trust
of our clients. We enjoy +95% customer retention
 Infosys has built one of the largest corporate education
centers in the world. This 'finishing center', with an annual
capacity of 15,000, provides engineering graduates who aspire to
be employees with the equivalent of a Bachelor of Science
degree in Computer Science from an American university

Case study 1
Business ethics for corporate growth :
A case study of Infosys in India

Mission Statement of Infosys.

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“To achieve our objectives in an environment of fairness, honesty
and courtesy toward our clients, employees, vendors and society
at large’

Starting in 1981 in Bangalore, India with seven colleagues who

dared to dream and who were lucky to be among the first in the
economic liberalization of India in 1990s, Infosys has crossed
billion dollars in revenues in 2004.The company has maintained a
consistent growth and built a global company providing turnkey
sofware development. There are many businesses that succeed-
the unique factor about Infosys is in just over two decades it has
built a brand known for ethical standards both inside and outside
in the marketplace. The hypothesis of this paper is that corporate
ethics promotes and inspires competitive advantage in a
burgeoning marketplace.

Ethics in Corporate governance means the parameters which a

company sets for itself for its functioning. Transparency and
disclosures about accounts as well as other important issues
have to be communicated to the stakeholders in a truthful and
prompt manner. These build up confidence and trust in the
marketplace. When issues like Enron and WorldCom hit the
headlines, it is difficult to ignore business ethics. As consumers
are getting increasingly aware of ethical issues, corporations have
to respond to their concerns whether it is related to issues of
environment, heath or any other concern.

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In many of public addresses, the chief mentor of Infosys has tried
to set benchmarks in the business environment. In his address at
the Confederation of Indian Industry leadership summit in
September 2003, he said “CEO compensation is an issue that has
to be decided by the board and shareholders. Three factors are
to be considered for this-fairness, transparency and
accountability". In the same speech he added, “ We have seen
particularly in the west when the companies did not do well,
when they had to fire thousands of employees at lower levels ,
the CEOs continued to get very good salary. That hurts people."

Such type of remarks, which when backed by action, helps a

company in building up a band of stakeholders who back the
growth of the company. Thus, the widely reported news in media
that Narayana Murthy still lives in his modest flat establishes his
company’s credibility in the Indian market where the gap
between the rich and the poor is immense. When words and
action do not match, people become cynical.
To verify how much ethics mattered for a person who wants to
invest his money in a firm, a random survey of 50 persons was
carried out in the national capital of Delhi . The question asked
was
“If you have to invest in a company which of the two would you
give more preference

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(a) Consistent growth of a firm which has exemplary ethical
history.

(b) High profitability of a firm but which is largely non

transparent and no clear ethical rules."

More than 80 percent supported the firm with a good ethical

history. Though the other company was highly profitable, yet its
non transparent nature made it a risky venture.

Conclusion
“A business that makes nothing but money is a poor kind of
business"
Henry Ford, 1863-1947

Case 2
Narayana Murthy: Infosys has no intention to spy on employees

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NR Narayana Murthy, the chief mentor of Infosys Technologies
Ltd, has said that the company does not intend to monitor or
otherwise act on what its employees may do as private citizens
delinked from the company.

Replying to a query by our columnist Dr Samir Kelekar, the

Infosys chief mentor said, "Our policy, while encouraging usage
of social media, reinforces some guidelines which protect
employee and organization by reinforcing client and company
confidentiality, intellectual property and code of conduct."

There were reports that Infosys, the second largest IT Company

in India, was planning to implement a social media policy for its
employees from August. The report said from August whatever
an employee of Infosys posts on social media networks like
Facebook, Orkut or micro-blogging site Twitter will be under the
company's watch.

Mr. Murthy said that the company feels that such activities will
be governed by larger societal mechanisms that are in place or
will happen in the future. "Infosys considers its social media
policy as an extension of its policies that cover other means of
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communication or media. Formal polices drive effective practices
and we have designed our policy to do just that," Mr Murthy said
in an email.

There were apprehensions that if put under curbs or watch,

employees may start blogging anonymously. Allaying
apprehensions about policing the usage of social media by
Infosys employees, Mr. Murthy said nobody has said that the
company will police such networks. "Please go not by what
appears in newspapers but what you ascertain from the leaders
of the company," he said.

According to a draf policy about social media networking

prepared by Infosys, its guidelines only aim to provide helpful,
practical advice to utilise electronic communication devices in a
legal, ethical, and appropriate manner while wearing the Infosys
badge. "This policy does not cover postings that you (the
employee) may do as a private individual as long as you do not
associate Infosys in any way with your personal identity or refrain
from commenting about Infosys," the guidelines said.

Case study 3
At Infosys, it is always ethics first
Infosys fines its CEO for breaking companies’
rules
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Infosys is not only an IT bellwether; it's also an ethical bellwether.
The company, in perhaps the first instance in India, has fined its
CEO Kris Gopalakrishnan for a technical violation of its insider
trading rules.
The fine, Rs 5 lakh, would be donated to charity. Besides the CEO,
an independent director, Jeffrey Lehman, also has been fined
$2,000 for the same violation.
This is the third time that Infosys has punished a member of its
top brass. Earlier, it had imposed a penalty on its director Srinath
Batni.

In a notice to the US SEC, Infosys said Mr Gopalakrishnan had

inherited 12,800 equity shares from his mother on December 24,
2007 but had inadvertently failed to notify the company within
one business day afer the change in his shareholding.

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This, according to the company, constituted a violation of its
insider trading rules.
But Infosys audit committee believed that Mr. Gopalakrishnan
had no intention of contravening the rules and imposed the
penalty of Rs 5 lakh and directed him to donate the amount to a
charitable organisation of his choice. Mr. Gopalakrishnan has
made the donation.
Mr. Lehman was also imposed a penalty of $2,000 for failure to
correctly follow the procedure on sale of shares and that
amount, too, has been given to charity

Infosys employees to face a strict

‘social networking code’

Infosys is all set force a social networking code of conduct on all

its employees. Infosys already developed a social
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networking policy and they will bring that into action from next
month. Due to several privacy breaches happening with their
projects, and to prevent their employees sharing the project
details to others on social networking sites, the India sofware
giant has come up with this idea.
Infosys calls this as ‘social media policy’ and it contains all the
“dos and don’ts” clearly painting a ‘social media code’ on them.
Infosys told this policy is similar to that of other global company’s
policies and employees must strictly adhere to the terms in the
policy.
Infosys recently figured out tens of Infosys employees discussing
the project details on their social networking sites like Twitter
and Facebook.
Infosys mostly concentrated on ‘project-client’ issues in their
social media policy. Also the company would be asking
their employees not to pass personal comments on
other employees who are working in Infosys.
Infosys strongly warned its employees not to breach this
social media policy. If an employee found breaching it, he or she
has to face the disciplinary action. In severe cases, he or she
might even get kicked out of Infosys!
Infosys employees need to be bit careful with their twitter of FB
pages from now on!

Bibliography

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 Official Website of
Infosys :-http://www.infosys.com/about/management-
profiles/Pages/index.aspx

Other Websites referred:-

http://www.znews24.com/infosys-employees-to-face-a-strict-
%E2%80%98social-networking-code%E2%80%99.html

http://searchwarp.com/swa11985.htm

http://www.rtiindia.org/forum/2606-infosys-always-ethics-first.html

https://careers.infosys.com/infyrms/infycareers/careers/training.asp

Books Referred

 Human Resources & personnel mgt. :-Ashwad Thapa

 Books by Himalayan Publication

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