Source: ET
NEW DELHI: Over 200 public sector undertakings (PSUs) in the country do not have a company secretary on their rolls, even though they are mandated to have one, the government on Thursday informed Parliament.
A company secretary acts as a key personnel, who serves as an intermediary between the board of directors and the outside world, and ensures that the company does not flout regulatory norms relating to business decisions.
“As per available information 233 PSUs have not appointed company secretary,” minister for corporate affairs Salman Khurshid said in his reply to the Lok Sabha. Although the names of these PSU’s were not disclosed by the minister, a senior official, on conditions of anonymity, said the list of these defaulting companies mostly included the loss making entities and did not include the central navratnas.
“Normally, PSUs are unable to appoint company secretary due to financial position of such PSUs and non-availability of suitable company secretaries,” the government’s reply further said. Commenting on the minister’s statement, an senior official in the Institute of Company Secretaries of India (ICSI) said that there was no shortage in the number of registered company secretaries in the country.
Under the provisions of the Companies Act, every company having a paid up share capital of Rs 5 crore or above is required to appoint a whole time company secretary. The profession of company secretaries is overseen by the statutorily formed ICSI, which formulates code of conduct for its members.
Even though the Satyam crisis mainly raised debate on the role and effective functioning of the statutory auditors, the role of company secretaries has also come under focus, as the latter is privy to all that happens in a company board room. The role of the company secretary is mainly to ensure procedural compliance.
“As per available information 233 PSUs have not appointed company secretary,” minister for corporate affairs Salman Khurshid said in his reply to the Lok Sabha. Although the names of these PSU’s were not disclosed by the minister, a senior official, on conditions of anonymity, said the list of these defaulting companies mostly included the loss making entities and did not include the central navratnas.
“Normally, PSUs are unable to appoint company secretary due to financial position of such PSUs and non-availability of suitable company secretaries,” the government’s reply further said. Commenting on the minister’s statement, an senior official in the Institute of Company Secretaries of India (ICSI) said that there was no shortage in the number of registered company secretaries in the country.
Under the provisions of the Companies Act, every company having a paid up share capital of Rs 5 crore or above is required to appoint a whole time company secretary. The profession of company secretaries is overseen by the statutorily formed ICSI, which formulates code of conduct for its members.
Even though the Satyam crisis mainly raised debate on the role and effective functioning of the statutory auditors, the role of company secretaries has also come under focus, as the latter is privy to all that happens in a company board room. The role of the company secretary is mainly to ensure procedural compliance.
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