The 8th of August, 2013 would be remembered as a historic day in the history of Corporate India. For, on this very day the Rajya Sabha passed the much-awaited, the much-needed, a modern and contemporary company law. It would become the law of the land on receiving the assent of the Honourable President of India and on notification in Gazette of India, will replace the Companies Act, 1956.
The new Law is a progressive and forward looking which promises improved corporate governance norms, enhanced disclosures and transparency, facilitation of responsible entrepreneurship, increased accountability of company managements and auditors, protection of interest of investors particularly small and minority investors, better shareholder democracy, facilitation of corporate social responsibility (CSR) and stricter enforcement processes.
The new law also transits company secretaries to corporate governance professionals. It brackets them in the category of key managerial personnel and holds them responsible for implementation of all relevant laws applicable to the companies. It envisages a much larger role for them in the areas of secretarial audit, restructuring, liquidation, valuation and much more.
While the corporates and professionals have been gearing themselves up for this watershed event, it is our bounden duty to build human resource capacity in general and to prepare the company secretaries in particular, to implement the new law in letter and spirit. Under the guidance of the Corporate Laws Committee of the Institute, the ICSI has decided to take a number of initiatives in the next three months towards this end.
This Backgrounder on Companies Bill, 2012 is the stepping stone towards more elaborate and more focused capacity building exercise by the Institute.
Readers would find the contents of this Backgrounder useful in understanding the new Company Law.
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