Company secretary is responsible for appointment of independent directors in such a way that the directors fulfill the criteria laid down in companies act and listing regulations. Under law, CS has a critical role to play in organizing and implementing boards decisions, its committees, general body meetings. The soul and core of corporate governance is not the conduct or behavior that we see on face of it. A company secretary plays a major role in ensuring good governance practices in a corporation, whether privately or publicly held. The Company Secretary should have both functional and administrative responsibilities. Also a CS has to ensure that the same information is disclosed in the annual report of the company as well it shall be placed on the website of the company. It, therefore, behoves on the Company Secretary to ensure that good corporate governance practice is enshrined. Basic Corporate Governance; including the history of governance, governance . Study Resources. Corporate governance is concerned with the process by which corporate companies and particularly limited liability companies are governed. The role of the corporate secretary The role of the corporate secretary has evolved from the traditional role of a secretary, namely as the person who takes minutes, organizes meetings, maintains the corporate record and associated documentation, and generally performs administrative duties for an organization. It mainly involves balancing interests of a companys stakeholders like shareholders, management, customers, financiers, government, and the community as well. According to Section 204 of the Companies Act 2013, it is the duty of the Company Secretary in practice to perform the secretarial audit of every listed company. Role of company secretary is to ensure compliance by forming all the above mentioned committees. Company secretary shall act as a secretary of the all the above mentioned committees. Regulation 17 of the listing regulations states that the board of a listed entity shall have an optimum combination of executive and non-executive directors with at least one woman director and 50% of the board shall comprise of non-executive directors. Attending the meetings of the company, Board of Directors and its Committees, rendering all necessary secretarial services in respect of the meeting and advising on compliance by the meetings with applicable rules and regulations; Maintaining the registers and other records required to be maintained by the company under this Act; Rendering proper returns and giving notification to the Commission required under this Act; and. Further the regulations state that the approval shall be valid for a period not exceeding one year and fresh approvals shall be taken after the expiry of one year, but rule 6a states that the approval shall be valid for one financial year and fresh approval shall be taken after the expiry of the financial year. Having said that, it is pertinent to note that, good corporate governance involves a commitment of a company to run its business in a legal, ethical and transparent manner- a dedication that must come from the very top and permeate throughout the organisation. The responsibilities of the company secretary have been limited only to assisting and supervising board workflows, which can be seen in these areas: Preparing and documenting board and committee meetings. A company . The annual report of the company shall also contain a confirmation to this effect by the directors duly certified by the chief executive officer. States approve of corporations because they create jobs and contribute to the economic well-being of state and national economies. See you there. Second, it allows GCs to be proactive in meeting the corporation's needs in recruiting legal expertise and other areas. The Company Secretary is often referred to as the Chief Governance Officer/ Legal Officer of a company, and this emphasises on its role in promoting compliance with corporate governance practices. The Organisation for Economic Co-operation and Development (OECD) defines corporate governance as involving a set of relationship between a Companys Management, its board, its shareholders, and other stakeholders. Innovation will bring tremendous resistance from vested interest. It is also incumbent on the corporation to treat locals who work for a company with respect and not unjustly absorb most of the natural resources of an area, with the locals seeing little benefit. Without prejudice to the provisions of extant laws, the Company Secretary should be a person with relevant qualifications and competence necessary to effectively discharge the duties of his office. The regulations further state that a transaction shall be considered material if the transaction or transactions to be entered into individually or taken together with the previous transaction during a financial year exceeds 10% of the annual consolidated turnover of the listed entity as per the last audited financial statements of the listed entity. 4) 2008 Section 89/15 and 89/16, the Board of Directors has appointed Mrs. Pilasphan Udomjarumanee Senior Vice President - Corporate Secretary and Legal In performing this duty, the Corporate Secretary has the following roles and responsibilities: Arranging meetings for the Board of Directors, Management Committee and AGM as . The World Bank defines corporate governance as the following: A good summary of corporate governance entails solid codes of practice that provide a governing structure in which a company operates. | Powered by, Role of Company Secretary in promoting Good Corporate Governance. Also a CS has to ensure that the same information is disclosed in the annual report of the company as well it shall be placed on the website of the company. Kumar Mandalay Birla Committee, Narayan Murthy Committee, Cadbury Committee etc. Indian Companies Act, 2013. While a blanket limit has been specified by the regulations, the act lays down individual limits for each of the related party transaction specified under section 188 of the act. The Company Secretaries Act, 1980. When it comes to secretary and corporate governance, they are measures in which companies should operate to benefit owners and society at large. Moreover, corporations must adhere to a regulatory structure providing flexibility to sustain itself in an effective manner, responding to expectations from shareholders and other investors. The Companies Act, 2013 stipulates that a company shall enter into a contract or an arrangement with a related party with respect to sale, purchase or supply of any goods or materials, selling or otherwise disposing of or buying property of any kind, leasing of property of any kind, availing or rendering of any services, appointment of any agent for purchase or sale of goods, materials, services or property, appointment of a related party to any office or place of profit in the company, its subsidiary or associate company and underwriting the subscription of any securities or derivatives thereof of the company shall be entered only with the consent of the board of directors given by way of a resolution at a meeting of the board of directors. UpCounsel accepts only the top 5 percent of years to its site. This allows corporations to attract employees and raise capital from investors. The Essential Company Secretary Overview of the Guide: A member serving as a company secretary is regarded as both an officer and part of the senior management team, and at the center of the board's decision-making process. of the board shall comprise of independent directors and where the chairperson is an executive director, of the board shall comprise of independent directors. The governance framework is made to encourage the efficient use of a Companys resources and equally to promote accountability for the stewardship of the resources. Accordingly, the Secretary is expected to review the Board and the companys activities periodically to ensure minimum compliance with the best practices as well as advise on necessary improvements that would strengthen the overall governance of the company. The regulations further stipulate that the code shall incorporate the duties of the independent directors as laid down in the Companies Act, 2013. By following good corporate governance practices corporate earns or achieves best reputation in the world. Ashish M. Shaji has done his graduation in law (BA. Company secretaries have legal responsibilities for certain tasks that are required by The Companies Act 2006 such as corporate governance framework, shareholder communication, statutory compliance, general administration and other UK rules and regulations. Many countries, through their corporate networks and regulatory regimes embraced these principles and standards and accordingly, began to respond to the need to develop good governance processes by developing Codes of Best Practices on Corporate Governance for the guidance of their corporate sectors. Corporate governance improves capital efficiency of companies and provides a roadmap for an entity, helping the leaders of a company in making decisions by law, benefits to stakeholders, etc. Our Upanishads mentioned the hierarchy of human needs and different layers along with the levels of needs. The CS is a unique interface between the board as well as Companys management and acts as a vital link between the board and the business. Further the listing regulations have also mandated a quorum for the audit committee meetings, which shall be either two members or 1/3rd of the members of the committee, whichever is greater with at least 2 independent directors. In order to guarantee a successful corporate administration, it is imperative to ensure that the essential principles of corporate governance are adhered to by the company. In this article, we shall discuss the role of company secretary in corporate governance. Read our article: Appointment of Key Managerial Personnel under Companies Act, 2013. There have been cases where the companies management, despite having respectable independent and representative directors from the banks, have indulged in financial frauds for the benefit of promoters/management in control, and there has been no clear policy by the central government as to how these loopholes in the system can be plugged and how the money that has been looted can be brought back to the economy. While the provisions for omnibus approval are the same, the regulations state that where the need for related party transaction cannot be foreseen and the details regarding the same are not available the audit committee may grant omnibus approval for such transactions subject to their value not exceeding Rs. With the increasing rate of Boardroom dynamics, management of Companies are realising the need for company secretaries to provide this expertise, specialised skills and technical knowledge in the area of advising and guiding the Board to ensure full compliance with the law. One of the salient duties of a Company Secretary has a duty to advise the Board of Directors, through the Chairman of the Board, on all corporate governance and compliance matters. The responsibilities of the company secretary have developed substantially over time such that today, the company secretary does not merely carry out administrative functions but plays a key role in ensuring that the company's internal operations run smoothly, effectively contributing to the company's good corporate governance. Therefore, the position of the Company Secretary is mandatory for proper compliance under CAMA. Government has assigned the responsibility of good corporate governance to the company secretaries of india. The company secretary is required to have a good working relationship with all board members to enable him/ her to effectively advise the Board to ensure that they act in the best interests of the company. He has keen interests in doing extensive research and writing on legal subjects especially on corporate law. Understanding The Tax Obligations And Liabilities Of Companies In Nigeria. It ensures that corporate managers run their businesses successfully and take care of long term interests of the stakeholders of the company. Managing corporate records and documents. Lastly, there is a need for the full cooperation of the management of a Company to enable the Secretary to seamlessly and effectively carried out its duties. Corporate Compliance and Corporate Governance are important areas for effective capital markets and corporate growth. The Board is confident that it is applying the QCA Code across the main areas of delivering growth, maintaining a dynamic management framework and building trust. In practice, the role of the company secretary has developed into much more than the basic statutory requirements outlined above. It also involves implementing a rigorous annual Board, committee and individual director assessment. ROLE OF COMPANY SECRETARIES v Pursuant to section 383A of the Companies Act, 1956, companies with a paid-up share capital of Rs.Two crores or more are compulsorily required to appoint a whole time Company Secretary who must he member of the Institute of Company Secretaries India.
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