The Rs.70 billion ($1.43 billion) financial scam in Satyam Computer Services is a “blot” on corporate India's image, and the government was determined to unravel the “plot” and punish the guilty, Prime Minister Manmohan Singh said Saturday.
He urged all Indian corporate leaders to look closely into their operations so that fraudulent activities were as effectively prevented as is humanly possible.
“The Satyam episode is a blot on our corporate image. It indicates how fraud and malfeasance in one company can inflict suffering on many and can also tarnish India's image more broadly,” the prime minister said.
“The government is determined to unravel the full nature of the fraud and punish those involved under the due process of law,” he said at The Economic Times Awards function at the Trident Hotel here, attended by who's who of India Inc.
Satyam is facing a major financial mess and a serious threat in continuing its operations because of the Rs.70 billion fraud admitted last week by its founder and former chairman B. Ramalinga Raju.
Manmohan Singh urged all Indian corporate leaders to look closely into their operations to ensure that their systems were fully operational and fraudulent activities were as effectively prevented as is humanly possible.
“Corporate leaders and managements hold positions of trust for shareholders, workers, and other stake holders. Their actions have reputational impact much beyond the reputation of their companies,” he said.
“I seek your support in setting the highest standards for Indian industry so that the world can say that we emerged from the Satyam scandal stronger and more credible,” the prime minister said.
“I have no doubt we can do it.”
Earlier, Commerce Minister Kamal Nath took a stand far milder than that of the prime minister. He said the scam at Satyam Computer Services was an isolated case and did not tarnish the image of Indian corporate sector in any way.
"India Inc has established its credentials. One delinquency cannot be taken as a slur on the entire Indian corporate sector," the minister said during an opening panel discussion.
"The credibility of the Indian corporate sector, as I see it worldwide, is well respected. The transparency is well recognised, well established," he said, as Manmohan Singh and Maharashtra Chief Minister Ashok Chavan listened keenly.
"The premise that one Satyam episode has painted the Indian corporate in bad light - this is not the case."