New Delhi: Flipkart co-founder Binny Bansal's sudden exit from the online retailer on grounds of "serious personal misconduct" is a result of a two-year-old complaint of sexual assault made by a former female employee of Flipkart, sources told News18.
The complainant had left the company in 2012. It was only in 2016, when she started a firm of her own that she came in contact with Bansal again when the alleged sexual assault incident took place.
It was the time when Bansal had just taken over as group CEO from co-founder Sachin Bansal, who had become executive chairman.
After finding no appropriate action being taken, the former employee approached Walmart Global in July this year. She wrote to Walmart CEO Doug McMillon explaining the incident.
Walmart and Flipkart then roped in an international law firm to investigate the matter, even as Walmart closed the Flipkart deal by mid-August. The global retailer initiated investigations post July 2018.
The investigation conducted by the global law firm could not corroborate the allegation. It did, however, surface a lack of transparency and inadequate disclosures on Bansal'’s part, said a statement by Walmart.
The investigators concluded Bansal and the woman had a consensual affair, Bloomberg reported.
Bansal, on the other hand, strongly denied the allegation of “serious personal misconduct” but did not disclose the details. He said the developments had accelerated his decision to step down from the company he set up 11 years ago.
The Flipkart co-founder said he was 'stunned' by the charges. "For some time, I have been mulling over the right time to step away from an operating role at Flipkart Group. My plan was to continue in my current role for a few more quarters to continue the transition after closing the deal with Walmart. However, my decision to step down has been accelerated by certain personal events that have taken place in the recent past," he wrote in an email to employees.
Staff in Shock
Since the resignation, the entire Flipkart staff has been on chats and calls to see if they could get any additional information than what was officially disclosed about the allegations of personal misconduct. "Generally even the slightest of news reaches the office floor. But regarding this, we had no clue. None of us," a current employee said.
Several employees told News18 that Flipkart has instructed staff not to talk to the media on the matter.
However, Bansal's departure is not expected to change things much. A former executive noted that he was due to transition out of the company anyway. "It was planned, it might have happened next year," he said. Bansal too had pointed out in his email to employees that his plan was to continue in his group CEO role for only a few more quarters.
Flipkart CEO Kalyan Krishnamurthy also sought to reassure employees. "I wanted to personally let you know that there will be no changes in our operating processes, or to the mission of the company as a result of this news," he said in an email to staff.
He said the board remains committed to investing for the long-term and is supportive of the leadership team's desire to evolve into a publicly-traded company in the future.
What Happens to the Leadership Now?
Flipkart Chief Executive Kalyan Krishnamurthy, credited as the man behind the Flipkart buyout, will remain CEO of the company, which includes Myntra and Jabong continuing to operate as separate platforms within the Flipkart business, said Walmart.
"As we look ahead, we have full confidence in the strength and depth of leadership across the company. We remain committed to investing for the long-term and are supportive of the leadership team’s desire to evolve into a publicly-traded company in the future," Walmart added.
Krishnamurthy had first joined the online retailer in 2013 as its interim chief financial officer, following which he joined Tiger Global as its finance director in 2014. He was earlier with eBay’s Asia finance operations. He became the CEO of Flipkart in January last year and was given the mandate to turn around the company’s fate against rival Amazon.
Ananth Narayanan as CEO of Myntra and Jabong will report into Kalyan. Ananth was earlier with consulting firm McKinsey & Company and came to Myntra as CEO in October of 2015.
Sameer Nigam will continue leading PhonePe as CEO, Walmart said. Sameer served as Senior Vice President of Engineering at Flipkart until August 2015. He co-founded PhonePe in December of 2015, which was subsequently acquired by Flipkart in April 2016. Both Kalyan and Sameer will report directly into the board, Walmart said.
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