Procedure for Conducting Board Meeting

Introduction

Every Company shall conduct its first board meeting within 30 days of the incorporation, thereafter a minimum of 4 Board Meetings shall be held every year with a gap between two consecutive meetings of not more than 120 days. Relaxation in this regard has been given to One Person Company (with more than one Director), Small company and Dormant company for whom the provision of this section shall be deemed to have complied with if at least one meeting of the Board of Directors has been conducted in each half of a calendar year and the gap between the two meetings is not less than 90 days.

Applicable Provisions

While conducting the Board meetings, the company is required to adhere to the provisions of Section 173, 174 and 175 of the Companies Act 2013, the Companies (Meetings of Board and its Powers) Rules, 2014 and Secretarial Standard 1 –Meeting of the Board of Directors, prescribed by the Insitiute of Company Secretaries. Secretarial Standards are not applicable to OPC with one Director and a Company incorporated under Section 8 of the Companies Act 2013.

Procedure

Who can convene?

Any Director of a company may, at any time, summon a Meeting of the Board, and the Company Secretary or where there is no Company Secretary, any person authorised by the Board in this behalf, on the requisition of a Director, shall convene a Meeting of the Board, in consultation with the Chairman or in his absence, the Managing Director or in his absence, the Whole-time Director, where there is any, unless otherwise provided in the Articles.

Notice  

i. Notice of the meeting in writing shall be given to every Director to the email address or the postal address which the Director has registered with the company for the purpose of serving notices. In case the Company sends the Notice, Agenda and Notes to Agenda by speed post or by registered post, an additional two days shall be added for the service of Notice.

ii. Notice period shall not be less than 7 days unless a longer period has been prescribed by the Articles of the company. However, in case the meeting has been called for with Short notice, presence of at least One Independent Director is mandatory, if the Company has any. In the absence of the Independent Director, the decisions taken at the meeting shall be final only upon the ratification thereof by at least one independent director, if any.

iii. Notice shall specify the serial number, day, date, time & venue of the meeting and it shall be issued by the Company Secretary or where there is no Company Secretary, any Director or any other person authorised by the Board for the purpose.

iv. Notice shall inform the directors regarding the option available to them to participate through video conferencing mode or other audio-visual means, and shall provide all the necessary information to enable the directors to participate through video conferencing mode or other audio-visual means.

v. A director intending to participate through video conferencing or audio-visual means shall communicate his intention to the Chairman or the company secretary of the company sufficiently in advance so that company is able to make suitable arrangements in this behalf.

vi. Notice shall be accompanied by the Agenda setting out the business to be transacted at the meeting and notes to the agenda. However, notes on items of business which are in the nature of Unpublished Price Sensitive Information may be given at a shorter period of time than stated above, with the consent of a majority of the Directors, which shall include at least one Independent Director, if any.

Chairman  

i. The Chairman of the Board shall conduct the Meetings of the Board. If no such Chairman is elected or if the Chairman is unable to attend the Meeting, the Directors present at the Meeting shall elect one of themselves to chair and conduct the Meeting, unless otherwise provided in the Articles

Quorum  

i. Quorum for a Board Meeting is one-third of the total strength of the Board or Two Directors, whichever is higher. Ensure that the quorum shall be present throughout the Meeting i.e., not only at the commencement of the meeting but while transacting business also.

ii. For a public Limited company, an Interested Director shall not be counted for the Quorum. For this purpose, a Director shall be treated as interested in a contract or arrangement entered into or proposed to be entered into by the company with:

• • any body-corporate, if such Director, along with other Directors holds more than two percent of the paid-up share capital of that body corporate, or he is a promoter, or manager or chief executive officer of that body corporate; or
  • a firm or other entity, if such Director is a partner, owner or Member, as the case may be, of that firm or other entity.

iii. If the item of business is a related party transaction, then such director shall not be present at
the Meeting, whether physically or through Electronic Mode, during discussions and voting on such item.

Attendance Register

i. Every company shall maintain attendance register for the Meetings of the Board and Meetings of the Committee. The attendance register shall include the following details

• • serial no of the Board Meeting,
  • Day, date, time and venue of the meeting,
  • names & signatures of the Directors present, company secretary and invitees, if any.

ii. The attendance any Director attending the meeting through VC shall be recorded by the Company Secretary or the Chairman of any other Director present in the meeting and the details of such participation shall be recorded in the minutes.

iii. Leave of absence shall be granted to a Director only when a request for such leave has been communicated to the Company Secretary or to the Chairman or to any other person authorised by the Board.

Transacting the Business

i. Each item of business to be taken up at the Meeting shall be serially numbered. Each item of business requiring approval at the Meeting shall be supported by a note setting out the details of the proposal, relevant material facts that enable the Directors to understand the meaning, scope and implications of the proposal and the nature of concern or interest, if any, of any Director in the proposal, which the Director had earlier disclosed.

ii. Any item not included in the Agenda may be taken up for consideration with the permission of the Chairman and with the consent of a majority of the Directors present in the Meeting.

iii. Registers of all contracts or arrangements shall be placed in the meeting of the Board and signed by all the directors present at the meeting

iv. If the Chairman is interested in an item of business, he shall entrust the conduct of the proceedings in respect of such item to any Non-Interested Director with the consent of the majority of Directors present and resume the chair after that item of business has been transacted. However, in case of a private company, the Chairman may continue to chair and participate in the Meeting after disclosure of his interest.

v. Vote of thanks is given to the Chair at the conclusion of the Board Meeting