New Delhi: Concerned over corporate governance issues post-Satyam fiasco, industry body Confederation of Indian Industry (CII) on Friday announced the formulation of new corporate governance code for corporate sector to bring more transparency and better governance.
Chairman of CII special task force Naresh Chandra, while announcing the corporate governance norms, said that large and heavily publicised corporate frauds often provoke legislative and regulatory action, Satyam being the latest example.
However, for preventing such scandals, laws should be better managed and strengthened rather than imposing further regulations, he said while speaking at the annual summit of the industry body.
“The code would assist companies to take a voluntary step beyond the stated letter of law,” he said.
Present on the occasion, J J Irani, director Tata Sons, said that independent directors need to work with the management to prevent such happenings. Also, third party auditors can also play an important role in probing such frauds.
The companies should strengthen their corporate governance and separate the role of chief executive officer and chairman, which will bring in greater transparency, he said, adding that the internal audit system of the company should be made robust and as independent as possible.