The Institute of Company Secretaries of India(ICSI) has issued new secretarial standards bringing about several changes in terms of compliance for companies under the Companies Act 2013.
Section 118(10) of the Companies Act, 2013 mandates companies to observe Secretarial Standards with respect to general and Board Meetings specified as such by the Institute of Company Secretaries of India.
Further, Section 205 of the Companies Act, 2013 has casted a responsibility on the Company Secretary to ensure the compliance of the Secretarial Standards in a well defined manner and it is also required to provide comments in the Secretarial Auditor report to the Board of Director about the compliance of the Secretarial Standards.
Secretarial Standards shall apply to all companies apart from One Person Companies.
Some of the significant changes introduced by these new secretarial standards include:
- Companies must ensure that during the general meeting, the company chairman explain the objective and implications of a particular resolution before it is put to vote.
- There should be quorum throughout the meeting and not just at the beginning.
- With regard to board meetings, the draft minutes should be circulated to all the members of the board for their comments within 15 days from the date of conclusion of the meeting.
These standards shall be effective from July 1 2015.