Independent Directors are directors who are not associated with the company. They are important for strengthening the corporate governance contributing significantly at the boards by bringing a specialized set of skills with an independent judgement.
Independent Directors act as the custodians of good governance and balances the interest of the company and the interest of all stakeholders.
Therefore with a view to further strengthen the corporate governance framework, the MCA had introduced a databank maintained with IICA (Indian Institute of Corporate Affairs) which serve as a pool of information about the Independent Directors.
To serve as Independent director on the board of companies, the person shall register with the IICA databank and also to pass an online test. The test is broadly based on corporate laws, accountancy, governance, etc. which is useful in assessing the skillset of Independent directors.
The databank may be accessed by the companies who are willing to appoint Independent directors on their boards.
The basic objectives of the databank are as under:
i) To enhance the capacity of Independent directors by providing relevant platform for education.
ii) Develop and maintain a databank of Independent directors by way of empanelment of existing Independent directors as well as the persons aspiring to become Independent directors.
iii) Provide a platform to individuals to help them acquire knowledge, develop new skills, and apply best practices.
iv)Create a system for individuals looking for opportunities and corporate requiring to appoint Independent directors.
Summary
Independent Directors are vital for corporate governance framework in the companies and creation of databank, further strengthen the governance.
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(Republished with amendments)
Very comprehensive & precise
Thanks for providing clarity on the whole issue
Very lucid and informative article.
I superannuated as General Manager from Oil & Gas PSU recently.
Could you please guide me. Whether taking the test will be necessary?
Regards
Concise, relevant and informative. Is there any course or examination run by an Institute in India on Independent Director. Thx
I registered myself for Independent director’s database and recently successfully qualified for
assessment test. Now what next I need to do ?
Do I need apply for a DIN ? How I will be selected
for ID in any organisation ?
I will be thankful if someone share these information.
How to check if any individual is exempted from IICA test?
Very meticulous and informative
sir my brother preparing rrb exams last 3 years. but he cant pass still now anyone help him sir
please help him thank you.
I have 37 years experience in Banking Field . Can I apply for Independent director if yes what is the process and what about online examination
Thanks for the excellent guidance for the course.
What is the next step after passing exam and got the certificate?
Do we submit to anybody or we need to enroll further
Excellent guidance for course