Mumbai|Bengaluru: OP Bhatt's surprise resignation as non-executive chairman of Coforge stemmed from a row over the findings of an April board evaluation being kept from other directors, people with knowledge of the matter told ET.Crucially, these pertained to his own poor ratings during the exercise, according to the people cited. Bhatt couldn't be reached for comment despite several attempts to reach him by phone and email.Coforge, formerly NIIT Technologies, had said Bhatt resigned on Tuesday after concerns were raised over the way a board evaluation exercise was handled and presented, without disclosing details. The 75-year-old is currently chairman at Greenko Energy Holdings and an independent director at Wockhardt. Previously, he has served on the boards of several blue chip companies, including Hindustan Unilever, ONGC and Tata Consultancy Services.Also Read: Coforge stock tanks 7% as chairman OP Bhatt resigns over audit concernsET spoke to executives with knowledge of the matter and examined key documents to understand what transpired behind the scenes and led to the exit. The annual board evaluation process is mandatory as per the Companies Act of 2013 and the Sebi listing regulations of 2015. Coforge's board conducted these under the supervision of Bhatt and DK Singh, who is nomination and remuneration committee chairman.Two Separate Exercises Granular details and evaluation criteria were finalised after consultation with both in February. The audit chair and chief finance officer hired KPMG a few months later as part of a governance review.While investigating various documents regarding board and other committee meetings from July, KPMG said it uncovered inconsistencies. These were especially linked to two separate, but related, exercises - the board member evaluation report (BMER) and the board evaluation report (BER). The first rates directors individually, while the second considers performance as a collective.Also Read: Key Coforge shareholders were against OP Bhatt’s reappointmentThe findings had not been shared in full with the entire board in violation of the law, KPMG said. Only Bhatt and Singh had access to the reports in their entirety, according to the firm. Bhatt and Singh had summarised BMER and BER findings at the relevant nomination and remuneration committee (NRC) and board meetings in June, but certain key findings were left out or distorted, according to KPMG.While discussing the evaluation report of individual directors, only certain sections were taken up for deliberation by the board. KPMG said half of the eight criteria, including the section that covered Bhatt's own performance - which had received the lowest score among all directors - were not mentioned at all.KPMG also said he misled the board by stating the areas that fared most poorly included corporate culture."On two key parameters, which are linked, Bhatt kept the board in the dark," said an executive.The audit firm also recorded that the NRC chair presented findings of the report concerning individual members (BMER), while referring to it as the review of the entire board (BER). Conclusions were drawn without clearly distinguishing the two separate reports. Consequently, NRC members and the board were not explicitly informed that the BMER and BER were actually two separate reports and had different outcomes. There are video recordings of these board discussions.After KPMG highlighted these discrepancies in August, key Coforge investors confronted him with the findings.KPMG's investigation had commenced in early August after the declaration of first-quarter results at the end of July. The review covered a period of 12 months preceding the start of the audit.Bhatt, who'd been chair since May 2024, resigned on September 8. His term was to have ended in May 2027 and was scheduled for reappointment. An AGM notice for a special resolution regarding this matter was also circulated last month. People in the know said the NRC had been in support of the reappointment, as was Advent, which has two nominee directors on board. However, once the KPMG investigation came out, the tide turned against Bhatt.
OP Bhatt quit Coforge on board evaluation rift
OP Bhatt resigned as Coforge chairman after a dispute over board evaluation findings. These findings reportedly included his own poor performance ratings. KPMG uncovered inconsistencies in how evaluation reports were presented. Key information was withheld from the board, violating regulations. Investors confronted Bhatt after the audit firm highlighted these discrepancies.










