Our country has now adopted a philosophy of "Better late than never", following which the urgency of Compliance to Century Old Act's enacted by the Parliament was identified. This posed a major challenge to the Government as Compliance has a backbone feature of transition which is a day to day process. This further acted as "to have a bone in one's throat" for a country which never gave weight to compliance(s).
In this article, we understand what went wrong for the CS fraternity and identifying areas of improvement to be worked on.
1. As Section 203 and Rule 8/8A of Companies (appointment and remuneration of managerial personnel) Rules 2014, provides for appointment of Company Secretary: In every Listed Company and public company having a paid up capital of ten crores rupees or more,
2. A company other than companies mentioned above, having paid up capital of 5 crore or more.
This section covers more than 28000 companies operative in India which acted as bait to young directionless minds who want to secure their future with minimum efforts and maximum benefits. It overshadowed all other duties of CS prescribed under following laws:
- SEBI Act, SCRA and rules and regulations made there under
- Foreign Exchange Management Act
- Consumer Protection Act
- Depositories Act
- Environment and Pollution Control Laws
- Labour and Industrial Laws
- Co-operative Societies Act
- Mergers and Amalgamations and Strategic Alliances
- Foreign Collaborations and Joint Ventures
- Setting up subsidiaries abroad
- Competition Policy and Anti-Competitive Practices
- IPR Protection, Management, Valuation and Audit
- Drafting of Legal documents.
The above-mentioned law's burden required Company Secretaries shoulder but unfortunately, our fraternity got into the bait of Section 203 of Companies Act 2013. this proved to be an invitation to walking disaster which led the government to exempt private companies from Appointment of CS irrespective of their Capital.
In the fraternity, it is still observed as a black day when the sole purpose of existence for good corporate governance was nullified and ignored by the government, but thanks to our freedom fighters that we today live in a democratic country which gave us right to protest indefinitely which succumbed government's intention.
From above we derive a conclusion that our fraternity desperately needs to introspect and give equal weightage to other laws enacted in our country.