Finance minister Arun Jaitley with R. Sridharan, president of the Institute of Company Secretaries of India, in Calcutta on Sunday. Picture by Kishor Roy Chowdhury
Calcutta, Aug. 24: Finance minister Arun Jaitley today advocated greater transparency in the maintenance of accounts by the companies as this will strengthen the quality of corporate governance.
“It is necessary to have transparency and accuracy in the maintenance of records. Companies deal with investors’ money. Investors have a right to know about the affairs of the company,” Jaitley, who is also in charge of the corporate affairs and defence ministries, said at the 13th edition of the corporate governance award of the Institute of Company Secretaries of India here today.
He added that the quality of governance in the areas of administration, innovation and accuracy in maintaining records would not only improve transparency but also add to the credibility of the company.
“Quality of governance adds to a company’s credibility. The fly-by-night operators may or may not have instant success, but they are destined to go to the dustbin. Only those companies who maintain the highest standard of corporate governance would succeed and eventually become the best in the system,” Jaitley said.
He added that with the improvement in the economy, there would be a greater scope of growth for the corporate sector, investments and joint ventures.
“Indian economy is coming of age. Once we are at the takeoff stage, the opportunities for the corporate sector are going to be immense. There are opportunities for associations, joint ventures and investments,” he said adding that if there are any “black sheep”, the law will be tough on them.
Finance secretary Arvind Mayaram recently said the economy would grow around 5.8 per cent this fiscal against 4.7 per cent last year.
Jaitley said a new companies act had been put in place to improve the quality of corporate governance.
However, he had been receiving several requests to look into the various provisions of the act, which came into effect from April replacing the earlier one enacted in 1956.
“We have come up with a new companies act. It is only when it is unfolding, that you are realising where the shoe pinches,” he said.