Independent director

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

10 July 2013 If a non-executive director is the husband of
another director's/promoters daughter,then can he be considered as an independent director on the board?

Ajay Mishra

Ajay Mishra (Expert)

10 July 2013 Hi

No, it will not be considered as Independent Director.

As per Clause 49 of Listing Agreement:

‘independent director’ shall mean a non-executive director of the company who:
a. apart from receiving director’s remuneration, does not have any material pecuniary relationships or transactions with the company, its promoters, its directors, its senior management or its holding company, its subsidiaries and associates which may affect independence of the director;
b. is not related to promoters or persons occupying management positions at the board level or at one level below the board;
c. has not been an executive of the company in the immediately preceding three financial years;
d. is not a partner or an executive or was not partner or an executive during the preceding three years, of any of the following:
i. the statutory audit firm or the internal audit firm that is associated with the company, and
ii. the legal firm(s) and consulting firm(s) that have a material association with the company.
e. is not a material supplier, service provider or customer or a lessor or lessee of the company, which may affect independence of the director;
f. is not a substantial shareholder of the company i.e. owning two percent or more of the block of voting shares.
g. is not less than 21 years of age