NEW DELHI: The Indian government has appointed a three-member board to run scandal-hit software company Satyam Computers, which has been battered by India’s biggest corporate fraud.
The board is to meet at the earliest possible and decide a “further course of action,” Corporate Affairs Minister Prem Chand Gupta told reporters yesterday at a press conference.
The government sacked the Satyam board on Friday within days of Ramalinga Raju, the company’s founder and chairman, admitting fraud.
The three-member board “would be an independent board with full authority to act in the interest of the company. It will make its own assessment and take appropriate decisions,” Gupta said. The board’s priority “would clearly be to restore the company’s credibility, customer confidence and employee morale, and to safeguard the interest of investors and other stakeholders,” he added.
The new board includes Deepak Parekh, an eminent banker who is currently chairman of Housing Development Finance Corporation Limited (HDFC), Kiran Karni, former chief of the National Association of Software and Service Companies, and C. Achuthan, eminent lawyer and former boss of the Securities and Exchange Board of India (SEBI), India’s market regulator that is probing the billion-dollar scandal.
The minister expressed hope the new board would provide the necessary “vision, along with responsible and accountable leadership, to the company in this hour of crisis.”
Commenting on the demands of some institutional investors for representation in the board, Gupta said, “All options are open in the interest of the company.” The reconstituted board can have a maximum of 10 members according to the order of the Company Law Board.
“The first priority would be to meet as soon as possible. We will have to clear the mess,” Parekh said.
The board would soon meet to put in place an operational management to deal with the present problems, Karnik said. “We are trying to ensure India continues to be a safe, secure and reliable destination for IT services,” he added.
On what the new board’s agenda will be at its first meeting, Karnik said, “We don’t know what the status on the ground is at Satyam.