Under the provision of the Companies Act, 2013, Board of Directors forms committee so that they can delegate certain matters to the committees set up for the purpose. Committees are formed as a means to improve board effectiveness and efficiency in areas where more focused, specialized and technically oriented discussions is required. Board of the Director are the members of the committee.
AS PER COMPANIES ACT, 2013
|
SECTION |
NAME OF THE COMMITTEE |
APPLICABILITY |
COMPOSITION |
|
177 |
Audit Committee. |
Every Listed Company Every Public Company having Paid up share capital ≥ 10 Cr or more Every Public Company having Turnover ≥ 100 Cr or more Every Public Companies, having loans/ borrowings/ debentures/ or deposit > 50 Cr or more. |
Minimum 3 directors Majority of members of Audit Committee including its Chairperson shall be persons with ability to read and understand the financial statement. |
|
178 |
Nomination and Remuneration Committee |
Every Listed Company Every Public Company having paid up share capital ≥10 Cr or more Every Public Company having turnover ≥100 Cr or more Every Public Companies, having loans/ borrowings/ debentures/ or deposit > 50 Cr or more. |
3 or more Non Executive Director. Out of which not less than 50% are independent directors Chairperson of the company (whether executive or non-executive) may be appointed as the member of Nomination and Remuneration Committee but shall not chair of such committee. |
|
178 |
Stakeholders Relationship Committee |
Company having more than 1000 shareholders, debenture-holders, deposit-holders and any other security holders at any time during a financial year. |
Chairperson shall be non- executive director and such other members as decided by board. |
|
177(9) |
Vigil Mechanism |
Every listed Company Companies which accept Deposits from the Public; Companies which have borrowed money from Banks and Public Financial Institutions in excess of 50 crore rupees. |
As decided by Board |
AS PER SEBI (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2015
|
Particulars |
Audit Committee |
Nomination and Remuneration Committee |
Stakeholders Relationship Committee |
Risk Management Committee |
|
Regulation |
18 |
19 |
20 |
21 |
|
Applicability |
Listed Company |
Listed Company |
Listed Company |
Top 1000 Listed Company on the basis of market capitalization |
|
Composition |
Minimum 3 directors 2/3 shall be the Independent Director All members of audit committee shall be financially literate and at least one member shall have accounting or related financial management expertise. |
Minimum 3 directors All directors are non- executive directors At least 50% shall be the Independent Director |
At least 3 director with at least 1 being an Independent director shall be the member of the committee. |
Minimum 3 directors with a majority of them being members of the board of directors At least 1 Independent Director |
|
Chairperson |
Independent Director |
Independent Director {Provided that the chairperson of the listed entity, whether executive or non-executive, maybe appointed as a member of the Nomination and Remuneration Committee and shall not chair such Committee} |
Non- Executive Director |
Any member of the board of directors and senior executives of the listed entity may be members of the committee. |
|
Meeting |
At least 4 meeting in year and maximum gap between 2 meetings is not more than 120 days. |
At least 1 meeting |
At least 1 meeting |
At least 2 meeting in year and maximum gap between 2 meeting is not more than 180 days. |
|
Quorum |
2 members or 1/3 of the members {whichever is higher} + At least 2 independent director |
2 members or 1/3 of the members {whichever is more} + At least 1 independent director |
As decided by Board |
2 members or 1/3 of the members {whichever is more} Including at least 1 member of the board of directors in attendance. |
DISCLAIMER: The above mentioned article has been based on relevant provisions of Companies Act, 2013 and SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015. Under no circumstance, the author shall not liable for any direct, indirect, special or incidental damage resulting from, arising out of or in connection with the use of the information.
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