A Satyam cant happen as easily now

Government intervention may have salvaged Satyam a year after the scam broke,but questions have been raised on the way many in India Inc operate.

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Government intervention may have salvaged Satyam a year after the scam broke,but questions have been raised on the way many in India Inc operate. Corporate affairs minister Salman Khurshid talks to Shruti Srivastava about the lessons learnt,the revamp needed in the system and the norms corporates need to follow in order to restore the damage done. Excerpts:

After Satyam,what steps has the government taken to ensure such incidents dont take place in future?

That a Satyam will not happen again,nobody can say. But one can certainly say that a Satyam cannot happen as easily any more. We now want our legal system to act and respond so that the loose ends can be tied up. Special courts have been designated to act expeditiously and we have a standing queue of lawyers. We are keeping our fingers crossed.

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We dont have any exemplary punishment when it comes to corporate crimes in India.

In my assessment and that of the Solicitor General,given the existing law,there should be something that will have a reasonable impact in terms of sanctions imposed. We are certainly looking at it more carefully as far as sanctions are concerned. We have come out with voluntary guidelines for corporate governance and CSR. The worlds best practices are now practiced here. Hopefully the code and guidelines would take shape,which are binding indirectly and not directly. Some of it,when it becomes more acceptable,will become a part of the legislation which will be mandatory.

Should not the SFIO be given statutory powers looking at the need of the hour?

They will have it in the Companies Bill. The Bill at present doesnt specifically recognise the SFIO. It actually gives powers to the inspector. We would be happy if the suggestion comes from the Standing Committee. As far as powers are concerned,we have given all the powers called for and what we felt necessary during Satyam.

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But ICAI has not taken any action in case of the auditors and PwC?

They have prepared some internal reports and will take a final view soon. But they dont have access to the auditors who are in prison. They cant hold an ex parte discussion as it will be considered null and void. So they are trying to get the courts permission regarding the auditors.

The MCA has come out with a voluntary corporate governance code and CSR guidelines. How effective do you think they are going to be?

The response has been very good. We need to go step by step. We need to go slow,we have to see the response over a year and we will then take a call if we need to put some guidelines in the mandatory regime.