Sequoia Capital India, one of the most prolific and successful investors in India and Southeast Asia, addressed the allegations of fraudulent practices against some of its portfolio startups and pledged to take proactive steps to do more to improve compliance.

In a blog post published Sunday afternoon, the legendary venture capital fund said it is still a “work-in-progress” and said all players collectively need to “be more accountable, along with improving performance so we can get the full unlocking the potential of this region. has to offer.”

The post — which serves as Sequoia’s first official word on the matter — comes at a time when at least three of its portfolio startups have conducted investigations:

Fashion marketplace Zilingo has suspended Ankiti Bose, its founder and chief executive, this month over an accounting investigation. The head of Sequoia Capital India, Shailendra Singh, has left the board. (Both developments were first reported by Bloomberg News.) BharatPe co-founder and former chief executive Ashneer Grover resigned from the $2.8 billion startup earlier this year after investigations revealed that he and his wife transferred money. (Grover has refuted the findings.) Live commerce startup Trell recently investigated claims that its founders siphoned money and lied about usage and growth stats.

Sequoia Capital India, which did not name any startups, said it will work on a wide variety of things, including:

Board training for founders and senior management Implementation of whistleblower policies More independent board representation Call for more disclosures and stricter implementation of internal audits and controls

The post, written by the Sequoia team, said it often seems like investors aren’t doing enough due diligence, but recalled that when investments are made early on or at a later date in the early phase, “there is hardly a company even at a later stage, investors may be faced with negative surprises after the investment, if there is deliberate fraud and intent.”

The message adds:

As an investor’s representative, you sit on the board, and boards can only operate with the information shared with them – the less transparency there is for the board, the less they are able to really expose erroneous behavior. The board is there to govern and help make decisions in the interest of the shareholders. The board is not responsible for an ongoing investigation unless something is formally raised with them, often through a whistleblower. Better corporate governance is a shared responsibility of founders, management and board. And to get there, the ecosystem has to come together and commit to some changes.

At Sequoia India & SEA, we have always held ourselves to a high bar of integrity because we do this for the long haul. We will take a series of proactive steps as a responsible participant of this ecosystem and do more than our part to improve compliance of our portfolio companies, including, but not limited to, governance training for founders and senior management, implementation of whistleblower policies, more independent representation on the board of directors, call for more disclosures and stricter implementation of internal audits and controls.

We will continue to respond vigorously when we encounter intentional misconduct or fraud. When whistleblowers call us to report concerns, we always take them seriously. We know they turn out to be unfounded in some cases, but we still need to investigate them because it’s a board member’s fiduciary duty. We will continue to maintain a zero tolerance for proven wrongdoing. We will not hesitate to act to protect the interests of the company and employees, even if it costs us financially. We will make difficult decisions where necessary to do the right thing.

We hope more people in the ecosystem will join us in this pledge for greater governance. […]