THE COMPANIES ACT,

ACT 2013
(CA)
VIS A VIS
LISTING AGREEMENT (LA)

CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
COMMON THEME

Global
Good
Corporate
Governance
Practices

Align Interest
Transparency
of
& Disclosures
Stakeholders

2
CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 SEBI V/S MCA

Two sides of
a Coin Attempt to
outsmart
t t each
h
other

CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 ONE DISH – TWO COOKS

Parallel Requirements

Regulatory Gaps and

O l
Overlaps

Wastage of Resources
4
CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
BOARD OF DIRECTORS

Woman Independent
Director Director

Limit on Composition
Number of of Board of
Directorship Directors

5
CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
LA > CA

Code of Succession
Conduct Planning

Subsidiary
Co
Company
a

6
CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
MATTERS TO BE PLACED BEFORE
BOARD OF DIRECTORS (AS PER LA)
 Annual Operating Plans
 Capital Budgets
 Show cause
 Demand and prosecution
 P
Penalty
l notices
i
 Fatal or serious accidents
 Material default
 P ibl public
Possible bli or product
d t liabilities
li biliti
 Substantial payments,
 Significant Labour problem
 S l nott in
Sale i course off business,
b i
 Quarterly details of foreign exchange exposure
 Non compliance
7
CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 MATTERS TO BE PLACED BEFORE AUDIT
COMMITTEE (AS PER LA)
 Oversight of the company’s financial reporting process and the disclosure
of its financial information
 Approval of payment to statutory auditors for any other services
 Reviewing, with the management, the quarterly financial statements before
submission to the board for approval.
 Reviewing the adequacy of internal audit function
 Discussion with internal auditors of any significant findings and follow up
there on.
 Reviewing the findings of any internal investigations by the internal
auditors
 To look into the reasons for substantial defaults in the payment to the
depositors, debenture holders, shareholders (in case of non-payment of
declared dividends) and creditors.
creditors
 Approval of appointment of CFO after assessing the qualifications,
experience and background, etc. of the candidate.

8
CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 ANNUAL REPORT
LA > CA
 Web Link to be given in Annual report relating to details of Familiarization
programmes for the Independent Directors.
 All pecuniary relationship or transaction of the NED vis a vis the
Company.
 Number of Shares and Convertible instruments held by NED.
 Web Link to be given in Annual report relating to policy on determining
Material Subsidiary of the Company.
 A declaration signed by CEO regarding compliance of the Code of Conduct
by the Board Members and Senior Management.
 Company to disclose policy on dealing with related party transactions on its
website
b it and
d a Web
W b Link
Li k thereto
th t be b provided
id d in
i Annual
A l report.
t
 The company shall disclose the criteria for performance evaluation, as laid
down by the Nomination Committee, in its Annual Report.
9

CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 POLICY / DOCUMENTS
LA > CA
 Code of Conduct for all Board Members and Senior Management of
the Company.
p y
 Affirmation of Compliance with the Code of Conduct on annual
basis by Board Members and Senior Management.
 P li on Board
Policy B d Diversity
Di i
 Policy for determining Material Subsidiaries
 Related Party Transaction Policy
 Risk Assessment and minimization procedures
 Corporate Governance Report & Compliance Report on Corporate
Governance
 Management Discussion & Analysis Report

10
CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 POLICY / DOCUMENTS
LA = CA

 Terms & Conditions

C di i off appointment
i off Independent
d d Director.
i
 Vigil Mechanism (Whistle Blower policy) for Directors and
Employees
p y to report
p ggenuine concerns.
 Remuneration Policy (covering Directors, KMP & Employees)
 Formulation of criteria for evaluation of Independent Directors
andd Board
B d
 Formulation of criteria for determining qualification, positive
attributes and independence of a Director

11

CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 WEBSITE DISCLOSURE
AS PER THE COMPANIES ACT, 2013:

 Corporate
C t Social
S i l Responsibility
R ibilit Policy.
P li
 In case of a Listed Company, financial statements including consolidated
financial statements, if any, and all other documents required to be attached
thereto.
 Separate audited accounts in respect of each of the subsidiaries of the
Company.
 Details of establishment of Vigil Mechanism.
 Details of change in objects for which money has been raised from public
through prospectus and still has unutilized amount.
 Notice of a meeting proposed to be called in pursuance of an order of the
Tribunal u/s 230(1) accompanied by a statement disclosing the details of
the compromise or arrangement, a copy of the valuation report, etc.
 Statement containing names, addresses and unpaid dividend amount in
respect of Unpaid Dividend to be placed on website within 90 days of
transfer to Unpaid Dividend Account.
Account 12

CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 WEBSITE DISCLOSURES
AS PER RULES UNDER THE COMPANIES ACT, 2013:

 Copy of Circular for inviting deposits from the public.

 Notice of closure of register
g of members or the register
g of debenture holders or
the register of other security holders.
 Notice of General Meeting of the Company.
 Notice regarding E-voting facility at the general meeting.
 R lt off E-voting
Results E ti along l with
ith Scrutinizer’s
S ti i ’ Report.
R t
 Notice of Postal Ballot and results along with Scrutinizer’s report.
 Special notice, if it is not possible to give the notice in the same manner as
notice of anyy other g
general meetings.
g
 Notice of candidature of a person for the office of a director or the intention of
a member to propose such person as a candidate.
 Notice of resignation of Director.
 Notice (in Form INC-19) regarding conversion of Section 8 Company into any
other kind of Company.
 Notice in respect of the resolution for altering the objects for which money has
been raised from ppublic throughg pprospectus.
p
13

CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 WEBSITE DISCLOSURES
AS PER CLAUSE 49 OF THE LISTING AGREEMENT:

 The Terms and conditions of appointment of independent director shall be disclosed on the
website of the company.
 Code
C d off conduct
d t made
d for
f Directors
Di t andd Senior
S i managementt to
t be
b posted/disclosed
t d/di l d on the
th
website of the company
 Company to disclose policy on dealing with related party transaction on its website and web
link thereto shall be provided in the Annual Report.
 To disclose criteria for making payment to NED in annual report or put on the website and
annual report may contain reference to the same.
 Quarterly results and presentations made by company to analysts shall be put on company’s
website
 Code of conduct shall posted on website laying down duties for Independent Director as per
The Companies Act, 2013
 Details of familiarization pprogrammes
g for the Independent
p directors to be disclosed on
company website and web link thereto shall be given in the annual report
 Company to formulate policy on determining material subsidiary of the company and to
disclose such policy to the Company website and a web link to be provided in the Annual
Report.
Report
14
 The details of establishment of vigil mechanism shall be disclosed by the Company on its
website and in the Board’s report. CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 BOARD COMMITTEES
 Audit Committee
 Nomination & Remuneration Committee

 Stakeholders Relationship Committee

 Risk Management Committee (requirement of LA)

 Corporate
p Social Responsibility
p y Committee
(requirement of CA)

15

CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 EVALUATION MECHANISM
AS PER THE COMPANIES ACT, 2013:
Section 134(3)(p): A statement indicating the manner in which formal
annuall evaluation
l i has
h been
b made
d by
b the
h Boardd off its
i own performance
f andd
that of its committees and individual directors
(Applicable to Listed Company or Public Company having Paid Up Capital
of Rs.
Rs 25 Crores or more)
Section 178(2): The Nomination and Remuneration committee shall carry
out evaluation of every director’s performance
Schedule IV: Code of Independent Director:
II- Role & Functions: Bring an objective view in the evaluation of the
performance of board and management
VIII- Evaluation Mechanism: The performance evaluation of independent
VIII
Directors shall be done by the entire Board of Directors, excluding the
director being evaluated.
V- Re-appointment:
pp The re-appointment
pp shall be on the basis of report
p of
performance of evaluation. 16

CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 EVALUATION MECHANISM
AS PER CLAUSE 49 OF THE LISTING AGREEMENT:

D. RESPONSIBILITIES OF THE BOARD:

2. Keyy Functions of the Board- Monitoringg and Reviewingg Board Evaluation
Framework
II. BOARD OF DIRECTORS:
5. Performance Evaluation of Independent
p Directors-
a. The Nomination Committee shall lay down the evaluation criteria for
performance evaluation of Independent Directors
b. The Company
p y shall disclose the criteria for pperformance evaluation,, as laid
down by the nomination Committee, in its Annual Report.
c. As per CA..

17

CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 SEPARATE MEETING OF
INDEPENDENT DIRECTORS
LA = CA
(1) The independent directors of the company shall hold at least one
meeting in a year, without the attendance of non-independent directors
and members of management;
(2) All the independent directors of the company shall strive to be present
at such meeting;
(3) The meeting shall:
( ) review
(a) i the
h performance
f off non-independent
i d d di
directors and
d the
h
Board as a whole.
(b) review the performance of the Chairperson of the company, after
considering views of executive directors and non-executive
directors.
(c) assess the quality, quantity and timeliness of flow of information
between the company management and the Board. 18

CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 PERFORMANCE EVALUATION - LAYERS
Independent directors
Review performance of non
Independent Directors, Board
as a whole & Chairperson
[Schedule IV(VII)(3)(a)
&Schedule IV(VII)(3)(b) of
the Companies Act, 2013 &
Clause 49(II)(B(6))(i) &
Clause 49(II)(B(6))(ii) of the
Listing Agreement]
Nomination & Remuneration Board of Directors
Committee
Criteria of performance of
Independent Director & Board
[Clause 49(IV)(B)(2) of the
Listing Agreement]
Performance Evaluation of
every Director
[Section 178(2) of the
Companies act, 2013]
CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
Formal Annual evaluation of
its own performance & of its
committees & individual
directors
[Section 134(3)(p) of the
Companies Act, 2013]
Performance evaluation of
Independent Directors
excluding the director being
evaluated [
Schedule IV(VIII)(1) of the
Companies Act, 2013 &
Clause 49(II)(5)(c) of the
listing Agreement]
19
 E VOTING
E-VOTING
 Section108 of the Companies Act, 2013 read
with Rule 20 of the Companies (Management &
Administration) Rules, 2014

V/S
 Clause 35B of the Listing Agreement

20

CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 ABRIDGED FINANCIAL
STATEMENTS
 Section 136 of the Companies Act, Act 2013
read with Rule 10 of the Companies
((Accounts)) Rules,, 2014 ((Form AOC-3))

V/S
 Clause 32 of the listing Agreement

21

CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 RELATED PARTY TRANSACTIONS
 Section
188 of the Companies Act, 2013 read
with Rule 15 of the Companies (Meetings of
Board & Its Powers) Rules, 2014

V/S
 Clause 49(VII) of the Listing Agreement

22

CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
 CHANGE IN SHAREHOLDING
 Disclosure of change in Shareholding (SAST & PIT)

V/S
 Section 93 of the Companies Act,
Act 2013 read with Rule
13 of the Companies (Management & Administration)
rules,, 2014

23

CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY
THANK YOU

24

CS MANOJ HURKAT
PRACTISING COMPANY SECRETARY