09 June 2008
The Cl. 49 requires a listed company to have at least 50% of its directors as "independent" directors, if the chairman of the company is an Executive Chairman or he is related to Promoters family.
My query is - what if a company does not have a Chairman.
A company has option (but no compulsion) to appoint a Chairman of the Board. If a co. appoints such a Chairman, then at each meeting of the Board, he takes the Chair without any need for electing a chairman for every meeting. But if there is no such appointed chairman, then at each Board meeting the directors present will have to elect a chairman for that respective meeting.
Thus, the query is - if there is no such appointed Chairman, then can the company be exempt from the restrictive requirement of 50% "independent" directors? (In which case, it would be sufficient for the company if it has just 1/3rd of the directors as "independent"
10 June 2008
since, Cl. 49,restricts company to have 1/2 of independent directors = if chairman is executive or 1/3rd of such directors = if chairman is non-executive, 2ndly, in every board meeting other directors to have chairman who will initiate the proceeding of the meetings & subsequently sign the minutes. so, i think compliance to have chairman is mandatory either pre-decided or elected.
10 June 2008
assming that the co. does not have an appointed chairman of the Board, but chooses to elect one at each meeting separately .. in such a case, theoritically, in some of the meetings there could be an Executive Chairman, and in the others a Non-Executive Chairman ...... in such a scenario, how does the compliance get affected?
CAclubindia
