This was the verdict that emerged at a congregation of human resource and business experts at the three-day Nirma International Conference on Management (NICOM 2009), which started here on Thursday.

Dalit Mirchandani, chairman, Ingersol Rand, India, who was the chief guest, said: “The Statutory Audit Committee in every company relies solely on the audit report. It is surprising how a fraud of this magnitude escaped at least three filters.”

He elaborated on such frauds being related to issues of corporate governance in India, as the majority of businesses here are family-run. “Unless the Indian corporates learn to attract and retain the best of talent, my advice to them is always to exit from business,” Mirchandani added.

Endorsing this, Prof Allan Cohen, former Harvard professor and co-founder of the Indian Institute of Management, Ahmedabad, said: “The situation in the west is the same. Although on the face of it, the hierarchy may appear neutral, the underlining issues don’t differ much.”

Another issue that the delegates at the NICOM, which aims for ‘Strategic Human Resource Management and Entrepreneurship in the Changing Business Scenario’, discussed was the ailing Small and Medium Enterprises (SMEs) in Gujarat.