National seminar

A national seminar on the  observance of Secretarial Standards (SS) on Meetings of the Board of Directors and General Meetings by the corporate sector was recently conducted by Institute of Company Secretaries of India (ICSI). As per the Section 118 (10) of Companies Act, 2013, these standards issued by the Institute follow a consultative process and requires the approval of Central Government.

Addressing the seminar, Mamta Binani, VP, ICSI, said that “small and private companies will not have any difficulty in implementing the SS as it has enabling clauses in many cases. For instance, with respect to calling meeting at shorter notice, transacting any other business not in the agenda and passing of resolutions by circulation.

“A weak board process is a sure foundation for management and shareholders’ dispute. SS seeks to address all such issues. Much litigation arises on account of improper maintenance or manipulation and tampering of minutes, agenda papers, etc. all these issues are addressed in SS,” she added.

Binani emphasised that it’s all about the good corporate governance and transparency which makes the ease of doing business better. Pavan Kumar Vijay, former president ICSI and chairman SSB, said that these standards aims to facilitate the compliance with principles by giving clarity where there is ambiguity or standardisation of diverse practices. There is no question of additional compliance burden nor any additional compliance cost.

CS Vineet Chaudhary, council member, ICSI, informed the Standards are not inconsistent with the Act and don’t attempt to overstep the law. Rather the best practices followed by the corporates have been assimilated so as to integrate, harmonise and standardise the divergent secretarial practices followed by corporates. At certain places, provisions stricter than the law have been introduced for transparency and better governance.

While emphasising the need of SS, she pointed out that large public interest is involved in private and small companies also. Compliance with SS would enhance the confidence of the financial institutions and creditors who lend to these companies and reduce litigations in these companies, thereby boosting their business. The SS would also enable such companies to comply with the law and enhance their disclosures.