Board of Directors are the most essential Personnel of a company who are entrusted with the fiduciary duty to carry on objectives of the company in the manner profitable to its stakeholders. The Companies Act allows the Board to exercise all such powers, and to do all such acts and things, as the company is authorized to exercise and do, except those powers which can only be exercised or done by the company in a General Meeting. The powers of the Board are however, subject to the provisions contained in that behalf in the Act, other statutes, as well as the Memorandum and Articles of Association of the company or any regulations, including regulations made by the company in General Meeting.
REGULATORY PROVISIONS
- Section 118(10) of the Companies Act, 2013.
- “Secretarial Standard on Meetings of the Board of Directors” (SS-1).
CONVENING A MEETING
Any Director of a company may, at any time, call a Meeting of the Board where the Company Secretary or if there is no Company Secretary, any person authorized by the Board in this behalf, on the direction 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 OF MEETINGS
- The Notice shall be sent to all the Directors of the company on their postal address or e-mail address, registered by the Director with the company or in the absence of such details or any change thereto, any of such addresses appearing in the Director Identification Number registration of the Director.
- Notice convening a Meeting shall be given at least seven days before the date of the Meeting, unless the Articles prescribe a longer period. In case the company sends the Notice by speed post or by registered post, an additional two days shall be added for the service of Notice.
- Notice of the Meeting shall clearly mention a venue, whether registered office or otherwise, to be the venue of the Meeting and all the recordings of the proceedings of the Meeting, if conducted through Electronic Mode, shall be deemed to be made at such place.
PARTICIPATION THROUGH ELECTRONIC MODE
The Director may intimate his intention of participation through Electronic Mode at the beginning of the Calendar Year also, which shall be valid for such Calendar Year.
FREQUENCY OF MEETINGS
The company shall hold first Meeting of its Board within thirty days of the date of incorporation.
- For One Person Company, Small Company or Dormant Company
These Companies shall hold one Meeting of the Board in each half of a Calendar Year and the gap between the two Meetings of the Board is not less than ninety days.
- For all other Companies
The company shall hold at least four Meetings of its Board in each Calendar Year with a maximum interval of one hundred and twenty days between any two consecutive Meetings.
QUORUM
The Quorum for a Meeting of the Board shall be
- One-third of the total strength of the Board, or
- two Directors, whichever is higher.
Common List of items of business for the Agenda for the First Meeting of the Board of the company.
1. To appoint the Chairman of the Meeting.
2. To note the Certificate of Incorporation of the company, issued by the Registrar of Companies.
3. To take note of the Memorandum and Articles of Association of the company, as registered.
4. To note the situation of the Registered Office of the company and ratify the registered document of the title of the premises of the registered office in the name of the company or a Notarized copy of lease / rent agreement in the name of the company.
5. To note the first Directors of the company.
6. To read and record the Notices of disclosure of interest given by the Directors.
7. To consider appointment of Additional Directors.
8. To consider appointment of the Chairman of the Board.
9. To consider appointment of the first Auditors.
10. To adopt the Common Seal of the company, if any.
11. To authorize the issue of share certificates to the subscribers to the Memorandum and Articles of Association of the company.
12. To approve the appointment of the Key Managerial Personnel, if applicable and other senior officers.
Powers of the Board to be exercised at Board Meetings as prescribed under the Act
- To make calls on shareholders in respect of money unpaid on their shares;
- To authorize buy-back of securities under Section 68 of the Act;
- To issue securities, including debentures, whether in or outside India;
- To borrow monies;
- To invest the funds of the company;
- To grant loans or give guarantee or provide security in respect of loans;
- To approve financial statement and the Board’s report;
- To diversify the business of the company;
- To approve amalgamation, merger or reconstruction;
- To take over a company or acquire a controlling or substantial stake in another company;
- Any other matter which may be prescribed,
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