The apex body of IT-BPO companies in India, Nasscom, has revived its ethics and governance committee in the wake of the Satyam scandal.
Nascom's executive council, which will meet next week to discuss corporate governance failures, will look into companies that violate the corporate governance norms.
Nasscom officials said the action to be taken against such companies falls into three categories - awareness, best practices and punitive action. The committee can recommend actions like debarring the company at fault.
Commenting on Satyam, Nasscom president Som Mittal said it was a fraud issue and not a corporate governance issue. "It is an isolated case and not a reflection of the IT industry, which is robust on values. "The [new] board of Satyam is doing a great job ... it's a one-off case. Let us move on from what has happened in Satyam," he said.
Mittal said in most cases, IT companies have gone an extra mile by doing more disclosures, and the industry needs to prove that its governance standards are high. "This is a serious issue and not just about the IT industry or corporate India but about the corporate world. For Satyam, our main concerns were employee attrition and business continuity," added Mittal.
The IT industry body has maintained from the start that the sector would not be affected by the incident. Nasscom chairman Ganesh Natarajan had earlier said, "We believe the entire IT sector will not be impacted much, as we consider this as a specific case of a particular firm."
Ironically, Satyam's Ramalinga Raju, now behind bars, was once chairman of the top software association.
Team for US: A team from Nasscom will visit the US next month to liaise with the new Obama administration, politicians, think-tanks and corporate bodies and convince them of the benefits of outsourcing, among other things.
Nasscom chairman Natarajan, who will lead the team which will also include the body's president Som Mittal. Natarajan said the five-day visit would focus on three things - seeking a totalisation agreement, immigration issues and the benefits of outsourcing.
The US already has totalisation agreements with several countries, in order to avoid double taxation of income with respect to social security taxes. Though Indians with H1B or L1 visas contribute significantly to the US social security schemes each year, they do not the get benefits as India and the US do not have such an agreement.
Though Natarajan termed the visit as a routine quarterly exercise, it assumes special significance in view of the change of guard in the US and the Obama administration taking charge.