Company Secretary abbreviated as “CS” is a key professional in the corporate world. A CS is regarded as a “KMP” i.e Key Managerial Personnel under the express provisions of the Companies Act, 2013. By virtue of being designated as ‘KMP’ he is put along with Managing Director, CEO, Whole Time Directors and the CFO. Basically all of them performs the most important roles in their individuals capacity and as well as a team.

In many advanced countries of the world like USA, United Kingdom, Canada, etc the ‘Company Secretaries’ are commonly known as “Corporate Secretary”, “Board Secretary”, etc .

We will take a practical approach to understand the title that whether a ‘CS’ in employment is doing a ‘Corporate Job’ or  is rendering a ‘Service’ to the nation by helping the stakeholders.

By ‘Job’ here we means he is working as a corporate employee to maximize the profits and mitigate the risks for the company for which he is working and by ‘Service’ we means that he is acting as a government nominee to protect its interest.

How CS serves the stakeholders in corporate job…? Let’s understands the same:-

ROLE OF A CS  AS “KMP”  (DOING JOB)

As the very name suggest that CS is one of the key personnel who helps in managing the company and is made responsible for the compliance under the Companies Act and other applicable legislation. He has to report to the Board of Directors for timely guidance and strategic planning and also to perform such other duties as have been specified under various laws or delegated by the board from time to time. Moreover under SEBI norms a CS is regarded as a ’Compliance Officer’ which in itself is a great recognition.

But there is a line drawn in the role of a CS as a “KMP or Compliance Officer ” who is also a  “Corporate Employee” meaning how he balances his duties being in dual role.

In today’s world the role of Company Secretaries is multi fold and many times their role is combined with another role, but care should be taken that the prime role of governance should not be compromised.

Both the title “Compliance officer/KMP” and “Corporate Employee” are opposite to each other by very basic nature because as a compliance officer he has to comply and not manage. (here by ‘manage’ we means ‘business management’).

But it doesn’t means that CS has to do only the compliance part rather Company Secretaries are expected to possess commercial approach as well and use their senses along with technical skills to maintain sustainability of business instead of short term survival.  As such they are entrusted with multi fold role so balancing both the business and governance are equally important.

CA/CS/CMA as Army/ Navy/ Airforce for the Corporate World (Doing Service)

The hon’ble secretary Ministry of Corporate Affairs once addressed these three professionals as the Army, Navy and Airforce for the corporate sector. We all knows that in comparison to services rendered by our armed forces we are nothing they renders selfless service for the entire nation. But indeed it’s a great respect from the hon’ble secretary to the professionals.

CS RENDERING SERVICE TO NATION

Also appreciate one more thing that he said that professionals are not only doing a job but are rendering services to the nation. Rendering a service here means protection of the interest of the stakeholders including the government and contributing towards the betterment of the society.

Let’s understand more

Company Secretaries plays both the roles very effectively i.e serving the society as well as growth of the employer.

CS TO DECIDE THE CORPORATE CULTURE AND TORCHBEARERS FOR VISION 2022

The hon’ble Prime Minister Shri. Narendra Modi once in his speech said that CS professionals decides the corporate culture and are responsible for establishing the best corporate governance practices across the boards of companies. The PM also urged ‘ICSI’ to contribute its role in making the country a high tech compliant society by the year 2022. Every single word is highly motivational that the hon’ble PM gave the professionals such high recognition and responsible role to play in his dream of nation building.

CONCLUSIONArriving at the conclusion it is absolute correct to say that CS professionals are rendering their services to the nation as well as doing a job for the growth of his employer. There is no ambiguity that to maximize the profits and minimize the risks for the promoters is one of his duty but what matters more is to balance the interest of all stakeholders including the company which is in itself a separate legal stakeholder.  It is a well established fact that an organization is a corporate citizen and Company Secretaries are the conscience of such citizen due to their governance role.

DISCLAIMER

These are the personal views of the author and not an exact interpretation of the statue and may differ from person to person. The content published is only for educational purpose. Further the content is an original work of the author and it should not be used without permission.

(The author may be reached at email id paisalawgic@gmail.com)

Author Bio

Qualification: CS
Company: Himanshu Goyal & Associates (Practicing Company Secretaries)
Location: Delhi, New Delhi, IN
Member Since: 23 Oct 2019 | Total Posts: 15
A Company Secretary and a Post Graduate in financial administration having working hands in Investment Banking, Manufacturing Sector and Company Secretarial Practice. View Full Profile

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3 Comments

  1. Sreedar says:

    Very good article about CS profession.
    We could appreciate if it elaborate more on the current challenges are facing by profession due to AI etc.and other fellow profession’s etc

  2. Manish Anand says:

    Excellent,crystal clear explanation of whether A CS is
    1.corporate employee
    2.Service provider who works not only as a nation builder but also as a conscience keeper for the Government of India.
    3. Whether he is an insider or an outsider to the company.
    4. Or just a KMP..
    But there are a specialist field of officers who are known as ICLS officers(Indian corporate Law service officers) who are selected after writing the rigorous UPSC examinations.. these officers are appointed by the government of India in respective positions to prepare the bare act or amendments or notices their of which are to be complied with the company secretaries through out India.
    5.the point where the other explains that some powers of various stakeholders should be given to the company secretaries is counter-intuitive because various powers will be concentrated with key managerial person will get absolute power over the decisions to be taken regarding the long-term survival of the company itself and as we know absolute power corrupts absolutely.. Hansa company secretary should not be provided at various powers from the stakeholders.
    6.a company secretary being proficient in various corporate ,labour ,economic capital ,governance laws & rules and the company secretary act and rules and besides keeping the bottom line of the company in mind he had enough responsibilities and duties to be performed as a key managerial person to the company and I don’t think he must be given some additional powers and responsibilities.
    Conclusion: excellent representation of who and what a company secretary is what are his roles ,responsibilities and duties are. An excellent and enlightening article indeed.

    1. HimanshuGoyal says:

      Dear Sir, thank you for your appreciation and also appreciate your views.

      I Completely agree that giving some powers of various stakeholders may lead to concentration of power and CS are expected to perform the governance role besides keeping the bottom line.
      But in my individual opinion I think giving some additional powers with VALID LIMITATIONS and such VALID LIMITATIONS rest with stakeholders who ultimately controls the role may not lead to concentration of power and instead will help in balancing the role.

      It is also absolutely true which is highlighted about ICLS officers besides just adding, that their role is very Supreme and Crucial to CS role and accordingly the legislature delegates them appropriate powers from time to time.

      I respect your views as well because as said in the article that it may differ from person to person and situations. At the end thanks again for sharing your thoughts.

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