The Satyam scam, which is likened by many to the US's Enron scam, has brought about many corporate governance, disclosure and audit reforms to plug the holes that were manipulated by the tainted former chairman of Satyam Computer Services B Ramalinga Raju and team.
T V Mohandas Pai, chairman of Manipal Global Education, said the functioning of the board of directors was in a much better shape today because of the Satyam fraud.
He said the Sebi and the Institute of Chattered Accountants of India (ICAI) have put in place detailed corporate governance and audit norms as a reaction to the scam.
"After Satyam, corporate governance has been enhanced. Sebi has issued detailed guidelines for corporate governance and better governance to audit committee. The ICAI also came out with guidelines for greater disclosure of FD (fixed deposits) and assets. Besides these, a lot of other small steps have been taken after Satyam to make the board more accountable and responsible," he said.
Raja Shanmugham, chief people officer at the Bengaluru-based tech company Happiest Minds, also feels Satyam episode had led to companies becoming more stringent in the selection of the board members.
And even as Pai lauded the Thursday court verdict on the case, he said there was a need to relook at the laws pertaining to while collar crimes in the country.
"The government's done a great job. It replaced the board of directors with new a new board. It investigated, prosecuted and sentenced the culprits very fast. However, in my view, the sentence is not enough. There is a need to relook at laws for white collar crimes," he said.
PricewaterhouseCoopers (PwC), multinational audit and tax firm, whose two executives S Gopalakrishnan or Srinivas Talluri have been indicted in the case, said it was "disappointed" by the judgement and would appeal against it.
"We are disappointed with this verdict given by the court of Additional Chief Metropolitan Magistrate at Hyderabad. As we have said many times, there has never been any evidence presented that either of our former partners S Gopalakrishnan or Srinivas Talluri were involved in or were aware of the management-led fraud at Satyam. We understand that Gopal and Talluri are considering filing an appeal against this verdict," said the statement issued by the firm.
Post Stayam, the Sebi Committee on Disclosures and Accounting Standards (SCODA) came up with proposals for amendment to Clause 49 of the equity listing agreement, which came into effect last year.
The stock exchange regulator has set up a monitoring body to ensure compliance of Clause 49 by all listed companies, ascertain adequacy and accuracy of disclosures in the quarterly compliance reports received from the companies and submit a consolidated compliance report to it within 60 days from the end of each quarter. These were done put in place various checks and balance to detect corporate frauds early.
The amended Clause 49, also changed the composition of Board of Directors making it mandatory for companies to have at least 50% of its directors as non- executive and at least one women on board. Sebi also made changes in the selection and functioning of the independent directors.
