The Naresh Chandra committee is examining the possibility of inducting independent members in disciplinary committees to ensure accountability of auditors.
Secretary, department of economic affairs, V K Dhall said at the FICCI annual general meeting that while self regulation was important, it has to be tempered with outside presence.
Dhall's comments are significant as the Naresh Chandra committee on corporate governance, which was appointed by Finance Minister Jaswant Singh is expected to lay down a wide-ranging code of corporate governance guidelines.
Dhall said the committee's recommendations would be put on the Web next week for eliciting reactions before they are finalised.
He said liberalisation in the economy has to proceed with tightening of the regulatory aspects. He said the government was also working to plug the regulatory gaps by setting up the Serious Fraud Office.
He said the SFO would examine only the very serious cases of corporate malfeasance numbering about eight to ten in a year.
But it would be a multidisciplinary body with representations from tax officials, capital markets and other concerned departments to ensure that the gaps in regulatory overlap are plugged.
He said the JPC on stock scam has highlighted the weakness in the corporate governance practices including that of inadequate penalties.
The secretary also said the department has set up a group to come up with recommendations to ease compliance costs for private limited companies. He said they should be allowed to go for summary compliance.
Speaking at the same session divestment secretary Pradeep Baijal said there has been unwarranted criticism of the divestment ministry on allowing post closure adjustments in several cases.
He was referring to the comments that the Centre had given discounts for bids when the losses in some of the PSUs slated for divestment had been found to be bigger than expected.
He said these were very few. he also said there was no proposal to privatise the railways. Baijal said a position paper on divestment would be placed on the home page of the ministry within a fortnight.
Secretary Telecom, Vinod Vaish said there should be no rush to reduce STD rates further by TRAI and instead it should be left to market forces.
He said given the investments made by the NLD players they should be given some time to recoup those.
The telecom secretary said the big opportunity in the country is for manufacture of telecom equipments which was currently unexploited.
He added that while the market for cellular and basic services were maturing, the number of players would come down.
He also added that to increase their market shares, the existing companies would have to enhance their consumer services instead of concentrating on a rate war.
