Company management
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Company management

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    Company management Company management Presentation Transcript

    • Company management
    • A company being an artificial person cannot act by itself. It has neither mind nor a body of its own. The persons by whom the business of the company is carried on are termed as directors.
    • Director ?? Definition in companies act does not throw light on the functions and nature of duties performed by a director. So a director may be defined as a person who directs, controls, manages the affairs of the company. The directors of a company collectively are called Board Of Directors. It can be only an individual
    • Number of directors Every public company shall have at least three directors. Paid up capital of Rs.5 crore or more + 1000 or more small shareholders- one director Every other company shall have at least two directors. Maximum limit will be provided in the AOA. Increase or decrease by ordinary resolution and central govt approval if more than 12
    • Appointment of directors By the articles as regard first director or if not named By the company in general meeting- two third of total no. of directors of a public company liable to retire on rotational basis-public co or pvt co if subsidiary of public co Provisions- a. 1/3rd should be retiring from office b. Directors who have been from long c. Vacancy to be filled by retiring or any other d. If not, then resolution. If no resolution meeting adjourned same day in next week. If still not, retiring director seem to have been re-appointed
    • By the directors-additional (next AGM, no increase in max no.)/casual/alternate (in AOA, resolution in AGM) By third parties- one third of directors on non rotational basis. By proportional representation- not less than 2/3rd , but only once in 3 years and in casual vacancy By the central government- to protect the interest of shareholders, not more than 3 years. Applicable only If applied by- not less than 100 members or members not holding 1/10thof total voting rights
    • Number of directors Not in more than 15 companies. But exclusive Make choice of vacating in 15 days or the new directorship is cancelled Position of directors a. As agents b. Employees c. Officers d. Trustees- money, property and powers
    • Qualification of directors No provision regarding the qualification of directors. But AOA provides some qualification regarding the shares. Penalty- will be punishable which may extends to Rs. 500
    • Disqualification of directors Must be- an individual, competent, hold share qualification Is disqualified if:- Unsound mind. Insolvent or if application is pending Has not paid any call in respect of shares held by him for 6 years Disqualified by court Failed to repay loan or interest or not submit the accounts/auditing when he is already director of public co.
    • Meetings of directors Number of meetings- held at least once in every quarter and at least 4 such meetings in every year Notice of meetings- to be given in writing to every director being in India and at his address in India Quorum- atleast 1/3rd or even rounded off or 2, whichever is higher. If does not held, adjourned till same day in next week, same time and place. If public holiday, then the day following the same
    • Duties of directors Fiduciary duties- benefit of company, honestly, should not conflict his personal interest Duty of care and skill Duty to attend board meeting Duty not to delegate except to the extent in Act Duty to disclose interest
    • Removal of directors By the shareholders- by ordinary resolution except in the following case. Is appointed by the central government Removal by the central government- If a person is in fraud Not with sound princiles Conduct of the person has been such which is injurious or damaging the interest of the trade, industry,creditors,members
    • Removal by company law board– on the application of the tribunal for prevention of mismanagement, the tribunal may terminate, or modify the agreement between the company and the director. They will terminate for five years and can not claim damages or loss.