Dear Professional Colleagues,

Appointment of a Company Secretary has been one of the most talked topics in the recent times as Companies not just appoint them because there is a statutory requirement for a few class of the company including listed companies or company having paid-up capital more than the prescribed limited but due to the reason that he is someone who adds values to the corporate governance of the Company..

The Institute of Company Secretaries of India is the Regulatory Body in India. The Company Secretary is responsible for the efficient administration of a company, particularly with regard to ensuring compliance with statutory and regulatory requirements and for ensuring that decisions of the board of directors are implemented. Visit www.icsi.edu for more info.

Despite the name, the role is not clerical or secretarial. The company secretary ensures that an organisation complies with relevant legislation and regulation, and keeps board members informed of their legal responsibilities. Company Secretaries are the company’s named representative on legal documents, and it is their responsibility to ensure that the company and its directors operate within the law. It is also their responsibility to register and communicate with shareholders, to ensure that dividends are paid and to maintain company records, such as lists of directors and shareholders, and annual accounts.

Company Secretary is someone who holds a very high rank and position and is next to the Chief Executive including Managing Director, Chief Financial Officer, Whole-Time Directors. He himself may be the Chief Executive and then his position is next to the directors. In fact, he is the only employee who has advisory powers. His advice is sought in carrying out general administration and in the decision-making process at the time of framing policies of the Company. He is consulted to ascertain the legal implications of policy decisions. And so he is the only outsider who is present at the meetings of the Board of Directors. Very often he is taken to the level of Vice-President.

As per Section 2 sub-section 24 of Companies Act, 2013:

Company Secretary or Secretary means a Company Secretary as defined in clause (c) of sub-section (1) of section 2 of the Company Secretaries Act, 1980 who is appointed by a company to perform the functions of a Company Secretary under this Act;

As Per Company Secretaries Act, 1980: 

“Company Secretary” means a person who is a member of the Institute of Company Secretaries of India.

The requirement to appoint a Company Secretary in Private Limited Company is governed by the Provision of Rule 8A and in Public / Listed Company by the provisions of Rule 8 of The Companies “Appointment and Remuneration of Managerial Personnel” Chapter XIII under Section 203 of the Companies Act, 2013.

Following Companies need to appoint whole time company secretary (mandatory):

1. All Listed Companies (Rule 8 Companies Appointment & Remuneration of Managerial Personnel Rules, 2014)
2. Every Public Company having paid-up share capital of Rs. 10 Cr. or More (Rule 8)
3. Every other Company having paid-up share capital of Rs. 5 Cr. or More (Rule 8A)

CRUX:

Therefore every company which has a paid-up share capital of Rs 5 Cr. or more is compulsorily required to appoint whole time Company Secretary.

Board Resolution Format:

“RESOLVED  THAT pursuant to provisions of section 203 of the Companies Act 2013 and Rule 8 and Rule 8A of Companies Appointment & Remuneration of Managerial Personnel Rules 2014), Mr……………………………… Company Secretary (ACS/FCS: …………) be and is hereby appointed as the whole time Company Secretary of the Company with effect from (date) on such terms and conditions as decided and agreed by and between the Board and Company Secretary.

FURTHER RESOLVED THAT  Mr………………………… director of the company be and is hereby authorised to file necessary eforms and documents with Registrar of the Company and to do all other such acts, deeds and things which are necessary to give effect to the above resolution.”

• Meetings of the Board of Directors
• General Meetings
• Memorandum and Articles of Association
• Requirements of Stock Exchanges
• Statutory Registers
• Statistical Books
• Statutory Returns
• Report and Accounts
• Registration of Shares
• Communications to and from Shareholder
• Issues of Share and Capital and Restructuring
• Acquisitions, Disposals, and Mergers
• Corporate Governance
• Common Seal of the Company etc.

• As a senior level officer he can supervise, control and he can direct subordinate officers and employee.
• He can sign any contract/agreement on behalf of the company as a principal officer, subject to the delegation of power by the board of the company.
• Company Secretary can issue guidelines for the employees on behalf of the company.
• Company Secretary can attend the meeting of shareholders and the meeting of the board of directors.
• During Winding up, he can claim his legal dues as a preferential creditor of a company.
• He can sign and authenticate the proceeding of meetings (Board, AGM/EGM) and other documents on behalf of the company where the common seal is not required.
• Company Secretary is a Compliance Officer and concise keeper of the company and he has a right to blow the whistle whenever he finds the conduct of the officers or of the directors of the company are detrimental to the interest of the Company.