Under the second proviso to Section 149(1) of the Companies Act, 2013 read with Rule 3 of the Companies (Appointment and Qualification of Directors) Rules, 2014, every listed company and every public company having paid-up share capital of Rs. 100 crore or more or turnover of Rs. 300 crore or more must appoint at least one woman director on its Board. Before appointment, the proposed director must possess a valid DIN and DSC and furnish Form DIR-2 (consent), Form DIR-8 (non-disqualification), and Form MBP-1 (disclosure of interest). Where applicable, the Nomination and Remuneration Committee recommends the appointment. The Board appoints the woman director as an additional director, files Form DIR-12 within 30 days, and subsequently regularizes the appointment through an Ordinary Resolution at the next AGM, followed by another DIR-12 for change in designation. Listed companies must also comply with stock exchange disclosure requirements. These provisions generally do not apply to private companies, except qualifying subsidiaries of eligible public companies.
A. Governing provisions of Companies Act, 2013:
| The second provision of Section 149(1) of The Companies Act, 2013 Rule 3 of The Companies (Appointment and Qualifications of Directors) Rules, 2014 |
B. Applicability:
The following certain class of companies must appoint at least one women director on its board:
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C. Prerequisites:
| Key Requirements Before Appointment of Woman Director:
If Nomination and Remuneration Committee is applicable to the Company, it will suggest name of Women Director eligible to be appointed, terms of appointment, remuneration, etc. The proposed Women Director must have a valid and approved DIN and DSC. If not, application for this two must be made prior to appointment procedure. The proposed women director needs to submit her consent in form DIR-2, intimation that she is not disqualified to be appointed as a director in form DIR-8 and Disclosure of interest in other entities in Form MBP-1. |
D. Procedure:
| Sr. No. | Steps |
| 1. | Convene a Board Meeting for:
a) Verify the disclosures and declarations given by the women director to be appointed. b) Passing resolution for appointment of Women Director as an additional director subject to approval of shareholders in the Annual General Meeting of the Company. c) Authorizing any of the directors of the company to file E-form DIR-12 to the Registrar of Companies along with a copy of Board Resolution, Consent to act as a Director, Declarations and Disqualifications. Within 30 days of appointment. |
| 2. | Regularization in Upcoming AGM:
In the upcoming Annual General Meeting regularize the appointment of the women director by passing an Ordinary Resolution. |
| 3. | Filing of Form DIR-12:
After the General Meeting, DIR-12 to be filed again for change in designation (from additional to director). |
| 4. | Make Necessary entries:
Company should make necessary entries in the Register of Director and Key Managerial Personals and register of contract and arrangements in which Directors are interested in form MBP-4. |
E. Important Disclosures to be made in case of Listed Companies:
| → Disclosure to be made to stock exchange(s) the Outcome of Board Meeting.
Within 30 Minutes of Conclusion of Meeting. → Disclosure to be made to stock exchange(s) the Proceedings of General Meeting. Within 12 Hours of Conclusion of Meeting → Post on website about the Proceedings of General Meeting. Within 2 working days of Conclusion of Meeting |
F. Steps not applicable to Private Companies:
| The provisions pertaining to appointment of Woman Director is not applicable to private companies unless for the Private companies that are subsidiaries of public companies meeting the size criteria as required to have a woman director. |
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**This document is for educational purposes only and does not constitute legal advice.
Author : Ms. Kathanshi Jain, Article Assistant at M/s Ronak Jhuthawat & Co, Practicing Company secretary Call: +91 98874 22212 | Email: compliancerjac@gmail.com
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