Corporate Governance Board Of Directors

Priyanka Amin (62) Kalyani Gadre (71) Pranjali Patki (98) Vinayak Tilakar (117) Hetal Vasani (118)

Introduction
A board of directors is a body of elected or appointed members

who jointly oversee the activities of a company or organization. The board is elected by the stockholders and is the highest authority in the management of the corporation The board of directors provides the company with direction and advice. It is the responsibility of the board of directors to ensure that the company fulfills its mission statement. The board of directors frequently sets the company's overall policy objectives. A good board of directors includes knowledgeable and experienced business people.

 Any Public company desirous to list its securities with

any stock exchange has to execute the listings agreement prescribed by SEBI
The listing agreement prescribes the following

categories of directors:
1. Executive Director 2. Non-executive Director 3. Independent Director

Independence of Board

Independent of the influence of Management Clearly know their responsibilities and powers Focus on Policy Making and general direction No role in day to day affairs No conflict of interest Understand the organizations risk profile - training programs for Board members

Corporate Structure: Board of Directors

Executive directors Non Executive directors Board of Directors Independent Directors

Management

Supervisory & enforcement authorities

Corporate

Shareholders

Stakeholders

Creditors

Organization structure
Board of Directors

At the top of the company hierarchy is the Board of Directors, headed by the Chairperson or President. The Board is responsible for policy decisions and strategy. It will usually appoint a Managing Director or Chief Executive Officer, who has overall responsibility for the running of the business. Senior managers or company officers head the various departments or functions within the company, which may include the following:
Production Marketing Finance Public Relations or PR Information Technology or IT Research and Development or R and D Personnel or Human Resources

Managing Director

Senior management

Middle management

Composition
The Board of Directors should have a combination of Executive and Non-

Executive members, at least 50% of the Board should comprise of Nonexecutive members
Where the Chairman of the Board is a non-executive Director, at least one-third

of the Board should comprise of independent directors and in case he is an

executive director, at least half of the Board should comprise of independent

directors
Provided that where the non-executive Chairman is a promoter of the company

or is related to any promoter or person occupying management positions at the Board level or at one level below the Board, at least one-half of the Board of the company shall consist of independent directors.

Roles & Responsibilities of Board

Setting Tone at the Top Defining Business Philosophy Setting the:

Objectives Vision and Mission statement Strategy & Business Plan

Providing oversight to ensure achievement of organizational objectives - within the legal and regulatory framework and high business ethics Standing accountable to stakeholders

Responsibilities (Contd.)

Appointing key executives Defining powers and responsibilities of senior management Succession planning for key positions Disclosing conflict of interest Ensuring disclosure to promote transparency and market discipline

Responsibilities Policy Framework

Formulating policies :
Credit Investments and Treasury Management Human Resources

Internal Audit and Control

Compliance Risk Management Other areas

Communication and compliance

Responsibilities Internal Audit

Creation of separate department of Internal Audit, with

Professional Staff Full Scope coverage Audit Charter & Manual

Head of Internal Audit reporting to the board or the Audit Committee Appointment and remuneration of Head of Internal Audit

Responsibilities - MIS

Ensuring existence of an effective Management Information System For keeping itself abreast with Activities Operating Performance & financial condition Operating environment Major Risks Evaluating Performance of the management - based on certain benchmarks

Responsibilities Board Meetings

At least quarterly, preferably more frequently Individual Directors to attend at least half of the meetings in a year Information through agenda items in advance Recording minutes of deliberations in detail

Responsibilities - Others

Reviewing the effectiveness of Internal Controls Strengthening Risk Management Annual Financial Statements : - Coverage of Directors Report - Statement on Internal Controls - Risk Management Framework IFRS Reporting Regulatory compliance

Individual Directors
Individual directors often serve on more than one board.

This practice results in an interlocking directorate, where a

relatively small number of individuals have significant influence over a large number of important entities.
This situation can have important corporate, social, economic,

and legal consequences, and has been the subject of significant research.
Individual directors are accountable to the full Board of

Directors.

Roles
Individual director is to attend to the good governance of the

Agency as one member of the team of board members.

Individual director is to participate in board meetings to

enable the board to reach these decisions and make sure that the company's obligations are fulfilled.

Duties and Responsibilities

Individual directors have no power outside board meetings, apart from

any authority specifically delegated by the Board of Directors. However, at law the Board itself has not only substantial power, but also discretion in its use. Individual directors have significant duties and responsibilities, in consequence. The Board of Directors is charged with protecting the Agencys assets, safeguarding the public interest, honouring the rights of employees and creditors, and seeing to it that the Agency makes effective and appropriate use of resources in fulfilling its mandate and meeting the terms of its agreements with its government clients. Individual directors, as members of the Board, are expected to bring the full weight of their experience, integrity, judgement and abilities to this task.

Fiduciary Duty
Acting in good faith Freedom to act Ethical Conduct and Conflicts of Interest or Loyalty

Duty of Care, Skill and Diligence

Drawing on the full range of their talents, education and experience, every

director must act with the degree of care, skill and diligence that a reasonable person would exercise in similar circumstances. This standard of diligence implies that a director will study the Agencys vision, mission, values, policies, and agreements with government clients; become familiar with the requirements of legislation governing the Agency and the duties of the Board and individual directors; prepare for and take part in all meetings of the Board and any committees to which the director is assigned, unless excused; maintain, for their own reference, adequate notes of meetings and decisions; volunteer for and complete a reasonable share of tasks on behalf of the Board.

 Directors must seek to understand everything presented to them,

using board meetings to question anything doubtful or unclear and to ask for any further information they may need. They must be alert to the importance of ensuring that all board members, the Chief Executive Officer and staff are acting within their authority and in the best interests of the Agency. It is the responsibility of every director to help the Board execute its full job description, which includes the duties given to the Board in the Agencys by-laws and policies, in the Agencys agreements with government and under all applicable laws.

Thank You