Role of Directors
The Companies Acts in India has stringent corporate Governance requirements of Board members. Yet Raju was able to steer the Fabricated accounts through his board members for 6-years! This has Bewildered the Corporate sector and Regulators. At times, the company was holding excessive cash, as per the books. This should have invited questions by Board members. It is fair to expect independent directors, like Harvard Professor Krishna Palepu, the former non-executive director of Satyam, to be moral guardians of Corporate governance. The role of independent directors in accountability, transparency and governance is also determined by common sense and tradition. However, whilst Independent Directors should steer the company on the right path, ensure compliance, protect minority Shareholders, they principally depend on information furnished to them by auditors and Lawyers. It is unfair to expect independent directors, meeting monthly or quarterly, to be undercover detectives or CoPS!
Read more about this topic: Satyam Scandal
Famous quotes containing the words role of and/or role:
“The Declaration [of Independence] was not a protest against government, but against the excess of government. It prescribed the proper role of government, to secure the rights of individuals and to effect their safety and happiness. In modern society, no individual can do this alone. So government is not a necessary evil but a necessary good.”
—Gerald R. Ford (b. 1913)
“Where we come from in America no longer signifies—it’s where we go, and what we do when we get there, that tells us who we are.
The irony of the role of women in my business, and in so many other places, too, was that while we began by demanding that we be allowed to mimic the ways of men, we wound up knowing we would have to change those ways. Not only because those ways were not like ours, but because they simply did not work.”
—Anna Quindlen (b. 1952)