How to Conduct and Document Board Meetings Effectively as per Companies Act 2013 and Secretarial Standards

In this article we will discuss about Board Meeting as per Companies Act 2013, Board meetings are critical for the governance of a company. They are a platform for discussion and decision-making by the company’s board of directors. To ensure these meetings are conducted and documented effectively, one must adhere to the provisions of the Companies Act, 2013, and the Secretarial Standards set by the Institute of Company Secretaries of India (ICSI). Here’s how to do it step by step.

Step 1: Convene the Meeting

Issuing Notice:

• Draft a notice of the meeting according to Secretarial Standard-1 (SS-1).
• Include the meeting agenda, date, time, and location.
• Send the notice at least 7 days before the meeting to all directors, by hand, post, or electronic means.

Agenda:

• The agenda should be clear and comprehensive. Every item for discussion should be stated, including items specifically required by law.

Additional Documentation:

• Provide any necessary notes or supporting documents to the directors along with the notice.

Step 2: Ensure Quorum of the Board Meeting as per Companies Act 2013

Quorum Requirements:

• Quorum should be present throughout the meeting. As per the Companies Act 2013, the minimum quorum is 1/3rd of the total strength of the board or 2 directors, whichever is higher.

Leave of Absence:

• If a director cannot attend, they should notify in advance, and the board may grant a leave of absence if deemed fit.

Step 3: Conducting the Board Meeting as per Companies Act 2013

Chairing the Meeting:

• The Chairperson, as per the Articles of Association, presides over the meeting.
• In absence of the Chairperson, the directors present may elect one amongst themselves to chair the meeting.

Discussion:

• Follow the agenda strictly for discussions.
• Encourage open discussion and note any dissenting opinions.

Voting:

• Decisions are generally taken by a majority of votes. Each director has one vote. In case of a tie, the Chairperson has a casting vote.

Step 4: Documenting the Meeting (Minutes) as per companies Act 2013

Recording Minutes:

• As per Secretarial Standard-1 (SS-1), minutes should contain a fair and correct summary of the proceedings of the meeting.
• They should be entered in the minutes book within 30 days of the meeting.

Contents of Minutes:

• Include details like the date, time, place of the meeting, list of attendees, issues discussed, decisions taken, and the final resolutions passed.

Signing of Minutes:

• The minutes should be signed by the Chairperson of the meeting or the Chairperson of the next meeting.
• Once signed, the minutes are conclusive evidence of the proceedings.

Distribution:

• Copies of the signed minutes should be circulated to all directors within 15 days after these are signed.

Step 5: Compliance and Filing

Filing Resolutions with Registrar:

• Certain resolutions need to be filed with the Registrar of Companies within 30 days of the meeting.
• File using the prescribed forms and ensure that all statutory registers are updated accordingly.

Maintain Statutory Records:

• Safeguard the minutes and ensure they are accessible for inspections as required by law.

Step 6: Disclosure and Dissemination

Disclosure to Shareholders:

• Share relevant excerpts of the minutes with shareholders if required by law or demanded by shareholders’ agreements.

Website Publication:

• If applicable, publish the proceedings of the meeting on the company’s website as per the regulatory requirements.

By following these six steps, you can ensure that your company’s board meetings are not only effectively conducted but also meticulously documented in compliance with the Companies Act, 2013, and the Secretarial Standards issued by the ICSI.