Indian outsourcers are anxious to limit the damage to their reputation caused by the revelation Satyam Computer Services had fiddled its accounts in the biggest fraud in Indian business history.
The National Association of Software and Service Companies (Nasscom) which represents Indian IT companies, was quick to distance itself from Satyam, and to defend the reputation of the Indian IT as a whole.
"This is a stand-alone case of failure of corporate governance and it is critical that it be viewed in this light," Nasscom said in a statement on Wednesday.
While the law will take its course, “this incident is particularly unfortunate as the Indian IT-BPO industry had set very high standards of ethics and corporate governance,” Nasscom added.
Nasscom will work with a Satyam Task Force “to reach out to their customers and employees and guide them through the transition,” and will work with its membership “to re-commit to maintaining the highest standards of governance and transparency.
Disgraced Satyam former CEO Ramalinga Raju was a former chairman of Nasscom and a pioneer of the Indian IT and outsourcing industry.
Mark Kobayashi-Hillary, a director of the National Outsourcing Association in the UK, said, “This is about corporate governance, not outsourcing.” He described the Satyam affair as “India’s Enron” and said the issue highlights the need for CIOs to do due diligence.
“Satyam has long been held up as an industry leader, but this illustrates that brand reputation means nothing if you don ‘t do due diligence.” Kobayashi-Hillary went on to say it is difficult to do effective due diligence when fraud can occur at a publicly quoted company whose books are audited.