Few queries on directors
Querist : Anonymous
Can a MD / CEO serve on the board of other companies as well? If yes, is there a limit on the number of companies?
Can a former CEO/MD join on the board of the company?
Is it mandatory for the CEO/MD and Chairman to be different individuals? If yes, as per which section / guidelines?
Thanks
In case of Public Limited Company, a MD can be a member of the Board up to 15 public company and n number of private limited company. But MD without approval of CG can be MD of one more company.
In case of CEO, it means he/she is whole time employee of the company and his/her total service is restricted to only that company.
But, Generally the Companies Act, 1956 is silent about the provision of CEO, so you are free to use this post accordingly.
The provisions of the Companies Act, 1956 regarding MD/CEO is not applicable to private limited company.
So you are free to appoint him/her as per management decision.
Yes, there is no restriction on appointment of former MD/CEO in Board.
Also, it is not mandatory, that MD and Chairman should be different. However, CEO and MD can be different.
Querist : Anonymous
Regd part 2 of my query, can the former CEO/MD serve on the board of the company?
Is it mandatory for the CEO/MD and Chairman to be different individuals? IF so, as per which clause/section?
Querist : Anonymous
MD and CEO should be different, as its name pronounce different liability.
CEO word is not used under the Companies Act, 1956. It is used only in Listing Agreement.
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