Secretarial norms for board meetings released

Our Corporate Bureau

New Delhi, Jan 7: The Institute of Company Secretaries of India (ICSI) has for the first time released secretarial standard for conducting meetings of the board of directors. The standard lays down principles which the companies are expected to follow during board meetings.

As per the standard, board meetings should be notified 15 days in advance to every director either by post, facsimile or e-mail. The notice should also specify the day, time and full address of the venue of the meeting. Further, the standard stipulates that notifications are mandatory even when meetings are to be held on pre-determined dates.

According to ICSI release, the standard is expected to ensure uniformity and consistency in corporate practices and establish sound corporate governance principles. It also prohibits transaction of any business at the meeting which is not earlier notified. Any supplementary item not originally included in the agenda can be taken for consideration with the permission of the chairman and the consent of the majority of the directors present at the meeting.

Regarding the schedule of meetings, the ICSI prescribes that the board should meet, at least, once in every three months, with a maximum interval of 120 days between any two meetings so that, at least, four meetings are held in each year. The meetings should not be held without the required quorum and an attendance register containing the names and signatures of the directors present at the meeting should be maintained.

The annual accounts and quarterly and half-quarterly financial results of a company should be approved at the board meeting and not by means of a resolution passed by circulation, the standard prescribes.
In the case of a listed company, if there is any material variance between audited and unaudited results, the limited review report of the auditors should be discussed and approved at a board meeting and not by means of a resolution passed by circulation, the standard states.