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Calling for greater corporate governance, finance minister Arun Jaitley on Sunday said companies needed transparency in financial records, and the law will be tough on wrongdoers.
“To have sustained success, highest level of excellence has to be there — be it innovation, administration, maintenance of records. It is necessary to have transparency and accuracy for maintenance of records. Companies deal with investors' money. Investors have a right to know each affair of the company,” Jaitley said at the 13th ICSI National Award for Excellence in Corporate Governance in Kolkata.
“If there are any black sheep and they are identified, let the law be tough on them,” said Jaitley, who is also in charge of the corporate affairs ministry.
“Quality of governance adds to a company's credibility...Only those companies who maintain the highest standard of corporate governance would succeed and eventually become the best in the system,” he emphasised.
The minister said governance was one area where the country had to learn from international best practices.
Earlier on Thursday, Jaitley had said the Centre was working to tighten risk management in the banking sector to professionalise the management.
Jaitley said the government will consider the corporate sector’s request to make the necessary changes in the Companies Act, 2013.
“We have come up with a new Companies Act. It is only when it is unfolding, that you are realising where the shoe pinches. I have been receiving requests to have a look into the provisions,” the finance minister said. Jaitley further said that slowly, the Indian economy was coming of age and opportunities for the corporate sector were huge. “There are opportunities for joint venture and investment. I think when we are in the take-off stage, it would be time for corporates to take advantage of these opportunities by way of credibility and adopting best practices,” he added.
Interestingly, finance secretary Arvind Mayaram had on Thursday said the first signs of recovery were “surely visible” in the economy and growth may touch 5.8% in this financial year.