Revised Exposure Drafts of Secretarial Standards With Respect To General and Board Meetings

REVISED EXPOSURE DRAFTS OF SECRETARIAL STANDARDS WITH RESPECT TO GENERAL AND BOARD MEETINGS FOR PUBLIC COMMENTS

(Last Date for comments: May 21, 2014)

Section 118(10) of the Companies Act, 2013 provides that every company shall observe Secretarial Standards with respect to General and Board Meetings specified by the Institute of Company Secretaries of India constituted under section 3 of the Company Secretaries Act, 1980 and approved, as such by the Central Government. In the light of this, existing Secretarial Standards with respect to General and Board Meetings issued by the Council of the Institute are being revised as per the applicable laws.

Accordingly, the Secretarial Standards Board (SSB) of the Institute of Company Secretaries of India had revised its Secretarial Standard on Meetings of the Board of Directors (SS-1) and Secretarial Standard on General Meetings (SS-2) as per the new Act and Rules thereunder and hosted the Exposure Drafts thereon for public comments in the second week of April 2014.

Based on the public comments received and suggestions received from various quarters, SSB has now brought out Revised Exposure Drafts of the two Secretarial Standards namely Secretarial Standard on Meetings of the Board of Directors (SS-1) and Secretarial Standard on General Meetings (SS-2), comprehensively covering all aspects of the respective meetings viz. Physical Meetings of the Board of Directors, Meetings through Electronic Mode, Passing of Resolutions by Circulation, Conduct of Meetings, E-Voting, Passing of Resolutions by Postal Ballot and Minutes.

Based on the public comments received, these two Standards would be finalised and sent to the Central Government for their consideration and subsequent notification u/s 118(10).

The principal objective of the Secretarial Standards is integration, harmonisation and standardisation of diverse secretarial practices prevalent in the corporate sector. Further, Secretarial Standards seek to create template of highest order for corporates to follow, which addresses multiple grey areas in the law and incorporates Best Practices being followed by the corporates in the country, while simultaneously facilitating the professionals and benefitting the industry. Secretarial Standards do not substitute or supplant any existing laws or the rules and regulations framed thereunder but, in fact, supplement such laws, rules and regulations. In addition to the Secretarial Standards, requirements laid down under any other applicable law and rules and regulations needs to be complied with. In case of variations in any provision of the applicable laws and these Secretarial Standards, the stricter provisions need to be complied with.

In the light of the above, your specific comments or suggestions on the Exposure Drafts of on Secretarial Standard on Meetings of the Board of Directors (SS-1) and Secretarial Standard Secretarial Standards on General Meetings (SS-2) are solicited under following categories:

1. Drafting Errors or Improvements

Under this, we are concerned with deviations from the standard use of English as understood by a company. If you feel that the communication at any place is not effective or the standard is not clear and concise and can be improved kindly suggest the manner in which it should be expressed.

2. Areas not covered in law suggested to be covered in the Standard

Under this, we are concerned with situations where neither the Act nor the rules make provision to cover a given situation or the rules have not provided to make an exception where it is otherwise warranted.

3. Contradictions with the Act, Rules or Forms

Under this, you may point out any aspect of the standard which is not consistent with or contradicts any of the provisions of the Companies Act or Rules or Forms thereunder.

4. Contradictions with any other law

Under this, you may point out any aspect of the standard which is not consistent with or contradicts any of the provisions of any other Act or Regulations or Rules.

5. Multiple or diverse Interpretations of any part of the standard

The attempt of the standard is to have only one interpretation ie. the endeavour is to make the standard unambiguous. Kindly point out in this section, if you find any part of the standard which is capable of multiple or diverse interpretations or ambiguity.

6. Conflict with Judicial Pronouncements

Under this, you may point out if any part of the standard differs from or contradicts or is conflicting with any judgement of either the Supreme Court or High Court or any clarification by a regulatory authority like MCA, SEBI, stock exchange, etc.

7. Best Secretarial/ Industry Practices

Under this, you can share any good practices being followed by your organisation or industry, in respect of any of the areas which the standard seeks to cover, which removes the barriers that might have been hindering industry from complying with any of the provisions of the Act or Rules and/or facilitates better corporate governance.

8. Typical Situations/Scenarios not addressed in the Standard

Under this, you can list any critical issues or special circumstances encountered by you, which you consider are not addressed in the standard and which could be added.

9. Any other Suggestions not covered above

If you have any other suggestions or if you feel that the standard is not accurate or complete, you may respond under this. Otherwise, please confine your suggestions under the points enumerated above.