Finance Minister P. Chidambaram Saturday urged Indian companies to incorporate the rules of corporate governance to enhance productivity.

"Rules of corporate governance is essential to raise productivity because things are very cluttered in the private sector," Chidambaram said while speaking at a function of Indian Chamber of Commerce (ICC) here.

He favoured more autonomy to public sector undertakings and banks.

"Scams are not halting our growth in some sectors but lack of ethics, audit improvements, etc. Scams happen everywhere in the world," he said.

"For productive conversion of capital, more freedom should be given to business leaders and the younger generation."