Flipkart co-founder Binny Bansal has resigned as the Chief Executive Officer (CEO) of the company over allegations of serious personal misconduct, US-based retail giant Walmart said on Tuesday.
Bansal stepped down from the company with immediate effect and Kalyan Krishnamurthy will continue to serve as the CEO.
#BreakingNews | @Walmart says Flipkart Group CEO resigns after probe into alleged serious personal misconduct. Probe found no evidence to corroborate allegations against Binny Bansal. However, probe showed other lapses in judgement on Binny Bansal's part pic.twitter.com/0YYnb9pRUK
— CNBC-TV18 (@CNBCTV18Live) November 13, 2018
In August, Walmart Inc completed a deal with Flipkart to hold 77 percent stake in the Indian e-commerce company. The remainder of Flipkart was held by other shareholders, including Bansal, Tencent, Tiger Global and Microsoft Corp. It isn't clear if Bansal will continue to be a shareholder. Following is the statement released by Walmart on Bansal's exit.
Flipkart and Walmart statement on Binny Bansal - Nov. 13, 2018
Earlier today, Binny Bansal announced his resignation as CEO of Flipkart Group, effective immediately. Binny has been an important part of Flipkart since co-founding the company, but recent events risked becoming a distraction and Binny has made a decision to step down.
His decision follows an independent investigation done on behalf of Flipkart and Walmart into an allegation of serious personal misconduct. He strongly denies the allegation. Nevertheless, we had a responsibility to ensure the investigation was deliberate and thorough. While the investigation did not find evidence to corroborate the complainant’s assertions against Binny, it did reveal other lapses in judgement, particularly a lack of transparency, related to how Binny responded to the situation. Because of this, we have accepted his decision to resign.
Binny has been contemplating a transition for some time and we have been working together on a succession plan, which has now been accelerated. Going forward, Kalyan Krishnamurthy will continue to be CEO of Flipkart, which will now include Myntra and Jabong, continuing to operate as separate platforms within the Flipkart business. Ananth Narayanan will continue providing great leadership as CEO of Myntra and Jabong, and will report into Kalyan. Sameer Nigam will continue leading PhonePe as CEO. Both Kalyan and Sameer will report directly into the board.
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.
CNBC-TV18 quoted Walmart sources as saying that they first learned about the allegation of misconduct in late July and that the allegation was not made by an employee of Flipkart. However, PTI quoted sources as indicating that the complainant was associated with Flipkart a few years ago and is now running her own venture. This, however, could not be independently ascertained.
In an internal email, Krishnamurthy sought to assuage employee concerns stating that "there will be no changes in our operating processes, or to the mission of the company as a result of this news".
"Flipkart will continue to invest heavily in supply chain, innovation and technology, with a focus on optimising operations, and empowering employees... For Flipkart to keep succeeding, it is crucial for our teams to thrive, and we will continue to do everything possible to ensure you are given the opportunity to do just that," he added.
Bansal, along with Sachin Bansal, had co-founded the online retailer in 2007. Sachin quit the company after the Walmart deal.
With inputs from PTI
Updated Date: Nov 13, 2018 19:47 PM