“Secretarial Standards has received wide acceptance in the corporate world”.
Section 118 (10) of Companies Act, 2013 mandates the observance of Secretarial Standards on Meetings of the Board of Directors and General Meetings by the corporate sector. These standards have been issued by the Institute of Company Secretaries of India following a consultative process and with the approval of Central Government.
Shri Dhanraj, Member, (Technical) Company Law Board, Kolkata and Chief Guest of the inaugural session said that The Secretarial Standards guidesthecorporates in the best practices with regard to Board Meetings and General Meetings there by strengthening the Board processes. The standards assure the directors about the flow of information to the Board and ensures that due process with regard to general meetings are followed thereby boosting investor confidence and It also enhances the governance practices which is a pre-requite for the growth agenda.
While speaking on the occasion CS Atul H Mehta , President ICSI,informed that ‘Small and Private’ companies will not have any difficulty in implementing the Secretarial Standards as it has enabling clauses in many cases viz. with respect to calling Meeting at shorter notice, transacting any other business not in the agenda.
A weak Board process is a sure foundation for management and shareholders’ dispute. Secretarial Standards seeks to address all such issues. Many litigation arises on account of improper maintenance/ manipulation and tampering of Minutes, agenda papers, etc. The Standards address these issues, he added.
Private and small companies should be the “swacch” corporates; today’s private company may be tomorrow’s listed company. Whatever a private company is doing in preparation of minutes, notice etc. are the same; only time schedule and disciplined approach laid down. What is being practised is put into paper for uniformity.
CS Mamta Binani, Vice-President,ICSI in her speech said that emphasizing the need of secretarial standards in companies, she pointed out that large public interest is involved in private and small companies also. Compliance with Secretarial Standards 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.
She also explained that accordingly some of the standards of SS relating to quorum, voting rights, notice, appointment of proxies, provisions relating to chairman shall be applicable to private companies unless the articles of the company provide otherwise. It means if the article of a private company provide otherwise than what is prescribed under the Act/Secretarial Standards, then it has to follow the Articles.
Shri Vijay Kr Jhalani, Council Member,ICSI informed that Secretarial Standards has received wide acceptance in the corporate world and said that like accounting standards, the secretarial standards will be a game changer
CS Pavan Kumar Vijay Past President ICSI and Chairman SSB also spoke on the occasion and 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. The apprehension that the standards increases the compliances is unfounded. The standards in fact clarify the process to be followed so that the laws are followed in intent and good governance practices are adopted. The laws are subject to multifarious interpretation and standards clarify these.
CS Santosh K Agarwala,Council Member,ICSI and Programme Director in his speech informed the august gathering that the Secretarial Standards are not inconsistent with the Companies Act and do not attempt to overstep the law. Rather the best practices followed by the corporates have been assimilated so as to integrate, harmonize and standardize the divergent secretarial practices followed by corporates. At certain places, provisions stricter than the law have been introduced for transparency and better governance.
CS Sunita Mohanty, Chairperson, EIRC of ICSI in her speech said that it’s all about the good corporate governance and transparency which makes the ease of doing business better. She said that the Secretarial Standards are a repository of knowledge and these enhance better control and regulation on corporates.
CS Siddhartha Murarka, Council Member, EIRC of ICSI introduced the theme and the speakers earlier in the day .