‘There are no holy cows in Satyam’
The government probe into Satyam Computers will cover an entire gamut of issues, company affairs minister PC Gupta told Hindustan Times. Excerpts of an interview with Vinod Sharma and Gaurav Choudhury.business Updated: Jan 16, 2009 20:59 IST
The government probe into Satyam Computers will cover an entire gamut of issues, ranging from questions about its actual staff strength to the role of independent directors and the administration of its subsidiary companies including Maytas Infrastructure and Maytas Properties, company affairs minister PC Gupta told
. Excerpts of an interview with
The government has appointed a new Board and ordered multi-pronged investigations into the alleged fraud by the founder chairman of Satyam Computers. What next?
I strongly feel the company should continue because Satyam has internal strengths with more than 100 Fortune 500 companies as its clients. The new board is capable of taking care of operational issues. The other aspect is that of investigation. We have launched multi-pronged investigations that can go on separately.
Will the probe cover affairs of Maytas?
Inspections have already been ordered under Section 209A (covering subsidiary companies of a group) of the Companies Act. Whatever more is required to be done, will be done.
The role of independent directors has come under scrutiny. What regulatory changes are being considered?
As the law stands today, there is no separate recognition of the word ‘independent’. All directors are equally accountable. In the new law that we have introduced in Parliament, we have proposed that at least one-third directors should be independent. We have also clearly defined their role.
Will independent directors, if found guilty, be taken to task?
There are no holy cows.
Are you facing any constraints from the Andhra Pradesh government in carrying out the investigations?
It is better I don’t comment on this as it is a very sensitive issue.
Doubts have been raised about the headcount at Satyam. What is the actual employee strength? Is it much lower than 53,000?
I do not know exactly by how many thousands (the employee figures have been inflated). There are various ways to find this out. For instance, every employee has a permanent account number and provident fund. Investigating agencies are looking into all these aspects.
Why do you think Raju confessed?
I presume he must have felt that things were getting out of control. Otherwise the whole thing would have been detected by the ministry of corporate affairs through the early warning system under our own e-governance programme.
Was the government aware of a hole in the company’s books before Raju’s confession?
We had asked for a report from the registrar of companies (RoC) on December 17 and they started their work the next day. This was after the Maytas acquisition announcement.
Then why did the government wait?
The report from the RoC is a pre-requisite. Otherwise, someone could have gone to the Court and got a stay.
In wake of the Satyam Computers case, will the government suggest new amendments in the Companies Bill introduced in Parliament recently?
The Bill is pending before the standing committee and it would be open to improvement by the committee. In light of the latest developments they (the committee) would like to incorporate more stringent rules, regulations and compliances. The ministry would give its suggestions to the committee in wake of the developments.