Key Managerial Personnel (KMP) refers to persons holding significant positions in the company who are expected to perform their designated roles. They are the first point of contact between the company and its stakeholders and are responsible for the formulation of strategies and its implementation.
Key Managerial Personnel (KMP) in relation to a company, broadly includes:
i) the Chief Executive Officer or the Managing Director or the Manager;
(ii) the Company Secretary;
(iii) the whole-time director;
(iv) the Chief Financial Officer;
Every ‘KMP’, i.e. the CEO, Managing Director, Manager, CS, WTD, CFO, etc. wherever they are appointed, contributes to the achievement of company’s objectives. They are involved in planning, directing, and controlling the functioning of a company at different levels.
The Companies Act mandates certain classes of companies to have KMP as indicated below:
Every listed company and every other public company having a paid-up share capital of ten crore rupees or more shall have the following whole-time key managerial personnel:
(i) Managing Director, or Chief Executive Officer or Manager and in their absence, a whole-time director;
(ii) Company Secretary; and
(iii) Chief Financial Officer:
Summary-The Key Managerial Personnel performs a vital role in their specialised areas of functioning including finance, law, technical expertise, compliance, business promotion, etc.so as to contribute to the company.
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