Resignation and immediate fallout
Coforge chairman and non-executive independent director Om Prakash Bhatt resigned with immediate effect on September 8, 2026, following concerns raised by an internal audit into the company's board evaluation process. The company announced the resignation in an exchange filing, stating that the board had noted it and that Bhatt had also ceased to be a member of all board committees.
The resignation came days after shareholders at Coforge's annual general meeting on August 24 voted on Bhatt's reappointment as an independent director. Although the resolution did not pass the required 75% threshold — with about 65.47% votes in favour, according to voting data from the scrutiniser's report — Bhatt did not mention the vote in his resignation letter. Analysts tracking the company said the voting against his reappointment may have contributed to the resignation, though the company did not cite it as a reason.
The internal audit findings
As part of its internal audit plan for the second quarter of the financial year, Coforge's internal auditor reviewed the process followed for the Board Evaluation Exercise, conducted under Bhatt's guidance, and the resulting Board Evaluation Report (BER) presented to the board. The review identified concerns about how the BER had been dealt with and presented, including that certain material information contained in or relating to the report and the chairman's performance had not been fully disclosed to the board when it was presented.
The board subsequently set out its concerns and sought an explanation from Bhatt. Bhatt provided his response, but the board was still considering and evaluating it when he tendered his resignation. The company clarified that the chairman's resignation followed the concerns identified in the internal audit review and the subsequent process undertaken by the board to seek and consider his explanation.
In a later clarification, Coforge said the internal auditor had observed that the manner in which the evaluation findings were presented — without sharing copies of the reports — by the ex-chairman to the Nomination and Remuneration Committee (NRC) and the board did not cover all relevant aspects and findings. The reports were available only to the NRC chair and the board chairman, and were not made available to other board members, including independent directors, at the instruction of the chairman. In particular, while the chairman's category had received the lowest rating in the evaluation reports, this finding was not disclosed or discussed before the NRC or the board by the NRC chair and the chairman of the board.
The company stressed that the board evaluation process is entirely distinct from its financial reporting and audit processes, and that the inclusion of the reports within the internal audit scope was in the context of reviewing relevant governance processes. Coforge said the matter has no bearing on its financial or operational performance, its business and growth outlook, or its near-term, medium-term or long-term stated guidance. It also said the board and management team continue to support the company in its business and operations as usual.
Bhatt's response and resignation
In his resignation letter, Bhatt said he had acted in good faith throughout the board evaluation process. He said he had carefully considered the matters raised concerning the process, his response to those matters, and the resulting circumstances, and that it was appropriate for him to resign with immediate effect.
"I believe that continuing on the Board while there remains a disagreement considering the characteristics of my good faith actions in the Board evaluation process would not be conducive to the effective functioning of the Board," Bhatt wrote. He confirmed that the matters relating to the board evaluation process were the material reasons for his resignation and that there were no other material reasons.
Bhatt, a former chairman of the State Bank of India, had served as Coforge's chairman since 2024, with his term originally due to end in April 2027. He also serves as an independent director at pharmaceutical company Wockhardt Ltd.
Market reaction and interim leadership
Shares of Coforge declined sharply after the announcement. On Wednesday, the stock fell as much as 9% to a low of Rs 1,780 on the BSE, with early trade showing a plunge of more than 8%. Over 17 lakh shares changed hands in the first five minutes of trade on the NSE. The stock has since pared some losses, with later trading sessions showing smaller declines as the company issued further clarifications.
The company designated Vivek Sharma, a non-executive independent director, as interim chairperson until January 31, 2027. Following the resignation, the board also reconstituted its committees, with Beth Boucher designated as the new NRC chairperson, according to a regulatory filing.
Subsequent developments
On September 11, Coforge said that non-executive independent director DK Singh, who had served as NRC chairperson, had resigned, citing "differences and tensions" between the firm's independent and executive directors. The company refuted Singh's claims as "unfounded" and an "afterthought," stating that his resignation followed the internal audit review that flagged governance lapses.
The internal audit remains ongoing. Coforge has not specified what information relating to Bhatt's performance had not been disclosed to the board. The company said its board has worked in close cooperation, with all business strategies and governance decisions being approved unanimously, citing decisions including the divestment of the AdvantageGo business, the exit from the data-centre business, the acquisition of Encora, the execution of the Sabre contract, and the decision to exit the loss-making India government business.