Board evaluation report prepared by Coforge Chairman Bhatt at the heart of his exit

Months after HDFC Bank saw its chairman exit abruptly, Noida–headquartered mid-cap IT firm Coforge informed the exchanges that its Independent Director and Chairperson O.P. Bhatt has resigned with immediate effect. The company has appointed another Independent Director, Vivek Sharma, as the interim Chairperson till January 31, 2027.  

According to the company’s disclosure as a part of its internal audit plan for the second quarter of the last fiscal year, the company’s internal auditor, along with other matters, reviewed the process followed with respect to the Board Evaluation Exercise under the guidance of the Chairman and the resulting Board Evaluation Report (BER) presented by the Chairman to the Board. “The review identified certain concerns in relation to the manner in which the BER had been dealt with and presented to the Board, including that certain material information contained in or relating to the BER and the performance of the Chairman had not been fully disclosed to the Board when the BER was presented,” the company’s statement said.  

Following this, the company’s board expressed its concerns to Bhatt and sought an explanation in his capacity as the Chairman in relation to the matters identified in the review. Bhatt’s resignation comes even as his responses to the matters raised were being evaluated, with a final decision yet to be taken. 

Bhatt, a former chairman of the State Bank of India, had joined Coforge’s board in May 2024 and was reappointed for a second term starting May this year. He was also a member of the company’s Audit Committee, Stakeholders’ Relationship Committee, and Capital Raising Committee.  

In his resignation letter, Bhatt said, “This is not a decision I have taken lightly.” Rather, he wrote, that he carefully considered concerns related to the Board evaluation process and the subsequent circumstances and reiterated that there were no other reasons for stepping down. Bhatt said continuing on the board amid a disagreement over the “characteristics of my good faith actions in the Board evaluation process” would not be conducive to the effective functioning of the board.

BRE is a corporate good practice and a regulatory requirement where the board assesses the effectiveness of its committees, and individual directors by reviewing performance, composition, decision-making, and governance practices. Conducted regularly, the process is aimed at strengthening the Board's performance, and overall governance effectiveness.  

On the performance evaluation mechanism, the company's Board Report for FY26 stated, “The evaluation methodology covered various aspects, including structured questionnaires on overall Board effectiveness, evaluation of the Chairperson, peer evaluation of individual Directors (including Independent and Executive Directors), and evaluation of the Board Committees. The assessment also covered areas relating to Board composition, governance practices, risk oversight, financial monitoring, ESG and sustainability focus, strategy formulation, succession planning, people management, the quality and timeliness of information flow, and the conduct of Board and Committee meetings, together with provision for qualitative feedback to support a comprehensive report highlighting areas of strength and improvement.” 

The development comes soon after Coforge concluded the $2.35-billion acquisition of the US-based AI-native engineering firm Encora Inc., backed by Advent International. As part of the deal, the PE firm got two nominee directors—Shweta Jalan and Atin Hirachand Jain—on the Board.

While the exact nature of the material information contained in or relating to the BER and the performance of Bhatt under evaluation has not been disclosed, Coforge has negated any implications on the Company's financial statements or financial reporting of FY26. “The Company also clarifies that such matters do not have any bearing on the Company's operations, business performance and near-term, medium-term or long-term stated guidance, “ it stated.  

In its recently held Investors Day in June, the company’s management reiterated its ambition to be a company with $5 billion in revenue by FY30, implying 19% CAGR over FY26‒30E led by organic growth of 15% CAGR over the period.