New Delhi: In an effort to improve corporate governance among the companies listed, Sebi on Tuesday approved various regulatory amendments governing the appointment, re-designation and elimination of independent directors, including the requirements to reveal the letter of resignation from the individual.
There will be a one-year cooling period for independent directors who turn to the whole time director at the same company / detention / subsidiaries / associate companies or any company belonging to the promoter group.
As part of a review of regulations related to the Independent Director, the SBI Board has cleared the amendment to Sebi (list of liabilities and disclosure requirements), 2015.
Appointment, re-designation and elimination of independent directors must be carried out only through special resolutions authorized by shareholders.
This will apply to all registered entities.
Furthermore, the process that must be followed by the Nomination and Remuneration Committee (NRC) when choosing a candidate for appointment as an independent director has been made more transparent.
This includes an increase in disclosure regarding the skills needed for the appointment as an independent director and how the candidate proposed in accordance with the skillet, the word was released.
The composition of the NRC has been modified to include 2/3 independent directors instead of current requirements of the majority of independent directors.
“Approval of shareholders for appointment of all directors, including independent directors, will be taken at the next general meeting, or within three months after the appointment on the board, which before,” said the broadcast.
In the case of the feasibility criteria for the appointment as an independent director, the regulator said there would be a three-year cooling period for the main managerial personnel and their relatives or employees from the promoter group company.
“Relatives of company employees, holding, subsidiaries or associate companies have been allowed to become independent directors, without conditions for cooling periods, in line with Act Companies, 2013,” said the broadcast.
When an Independent Director resigned from the Corporate Board registered, Sebi said all individual resignation letters must be expressed together with a list of current directors and membership in the Board Committee.
Among other things, at least 2/3 of the Audit Committee members must be independent directors and all related party transactions must only be cleaned by independent directors in the committee.
“Director’s business requirements and insurance officers have been expanded to the top 1,000 companies (by market capitalization),” said Sebi.
This amendment must be carried out with the effect of January 1, 2022.
The Board Sebi also agreed to make a reference for the Corporate Affairs Ministry to “provide greater flexibility to the company while deciding remuneration for all directors (including independent directors), which may include the commission related to profit, Seating costs, ESOPS, etc., within the determined overall limit are determined based on the Company’s law, 2013 “, the release said.