Secretarial Standard-1 on Board Meetings

secretarial standards in the meeting’s processes and in topics related to them since company law provisions are growing stricter and ROCs are being more vigilant. Secretarial Standard 1 serves as a reference for conducting the Board Meeting in accordance with the Company Act,2013 regulations.

ICSI was the world’s first professional organization to begin the process of developing Secretarial Standards for the integration, harmonization, and standardization of corporate secretarial procedures. With the help of ICSI, the Worldwide Federation of Company Secretaries (IFCS) agreed to establish an International Secretarial Standards Board, which will develop international secretarial standards to extend good corporate governance discipline beyond national lines.

The Act, having recognized Secretarial Standards, initially prescribed two Standards, namely the Standard on Board Meetings (SS-1) and the Standard on General Meetings (SS-2) (SS-2). The Act requires that every corporation follow both secretarial requirements, and any noncompliance will result in penalties. To be completely compliant with the Companies Act, about nine lakh operating companies in India would have to conform to these Secretarial Standards. These guidelines would facilitate conducting business and improve governance.

Meaning of Secretarial Standard 1

In accordance with Section 118(10) of the Companies Act, 2013 the Institute of Company Secretaries of India (ICSI) has released Secretarial Standard 1. (Act). The Secretarial Standards Board (SSB), which was established by the ICSI in the year 2000, develops secretarial standards and establishes a set of guidelines for calling and conducting board meetings (including committee meetings) and other related events.

The secretarial standards are a set of principles that companies are supposed to embrace and adhere to when carrying out their corporate responsibilities, resulting in greater corporate governance. The Board of Directors is responsible for ensuring appropriate, timely, and adequate compliance with the terms of the Act, and they are professionally aided by Company Secretaries. The Institute of Company Secretaries of India (ICSI) noticed divergent secretarial practices over time while regulating the profession of the Company Secretary and felt the need for integration, harmonization, and standardization of divergent secretarial practices and established the Secretarial Standards Board (SSB) in 2000.

It is a unique and beneficial step, and ICSI has formed such a Board for the first time in the history of the business sector worldwide. The SSB is made up of experienced company secretaries representing companies as well as practicing company secretaries, as well as representatives from regulators, other professional organizations, and other chambers.

Scope of Secretarial Standard 1

Applicability of Secretarial Standard 1

The Board of Directors meetings
Committee of the Board meetings

Non-Applicability of Secretarial Standard 1

One Person Company (or “OPC”) with a board that only has one director.
Companies have a license under Section 8 of the Companies Act, 2013.
Such class(es) of corporations as the Central Government may be exempt via the notice, such as IFSC Public Company and IFSC Private Company

SS – 1 is in accordance with the Act’s provision. However, the Act’s provisions must take precedence if a Standard or a portion of it becomes incompatible with the Act as a result of later amendments to the Act.

If formed under the Act, companies engaged in the generation or supply of energy, banking companies, insurance companies, and companies subject to any special acts are also subject to SS-1. However, if the terms of these Special Acts, which apply to these companies and include the Banking Regulation Act, 1949, the Insurance Act, 1938, etc., conflict with SS-1, the provisions of those Special Acts must take precedence.

Secretary Standards’ Benefits

It leads to an improvement in the quality of secretarial procedures used by businesses.
It improves corporate governance and leads to more transparency in Board Meeting processes, particularly for private companies; and
It minimizes litigation. Many lawsuit situations arise from disagreements that arise as a result of Board Meeting notifications not being received, the agenda being introduced without appropriate warning, and so on.
It boosts the trust of investors who wish to invest in Private Limited enterprises, such as Private Equity players and overseas investors. Many private equity investors have already praised this decision.

Secretarial Standard-1 on Board Meetings

Who may convene the meeting
Time, place, and mode of holding such meeting
Meeting notice and agenda
Meetings of Board Committees and independent directors
Quorum
Attendance at meetings
Directors’ participation in a meeting via electronic mode
Chairman of board or committee meetings
Procedure for passing board resolutions at board meetings or by circulation

For a better understanding of our reader we have tried to simplify and incorporated the concept of Secretarial Standard-1 on Board Meetings SS-1, in a tabular form, which is as follows:

Who Can Convene a Board Meeting	All Directors Business Secretary (If any) Anybody authorized by the Board to act in this capacity upon the request of a Director after consulting with the Chairman While he was away (Unless otherwise provided in the Articles) Executive Director (If any) Permanent Director (If any)
Notice Shall be issued by	A company secretary, Any Directors or Any other individual designated for the purpose by the Board.
Period of Notice	Unless the Articles require a longer amount of time, should be communicated at least seven days prior to the date of the Meeting. A further two days will be charged for the service if the provider ships through registered or fast post. The dates and times of meetings are set in advance, and notice of meetings must be given.
Adjournment of the Meeting	At any time during the meeting, the Chairman may postpone it for any reason, except Dissented to Refused by a majority of the Directors present at a meeting at which a quorum is present.
Day, Time, Place	Any day, at any time, and anywhere
To whom Notice of the meeting will be given	To all Directors (Even to the original director even if these have been sent to the Alternate Director) Adjourned Meeting Notice: Distributed to all Directors, even those who missed the meeting on the scheduled day. Unless the postponed meeting is scheduled during the meeting, At least seven days before to the meeting, notice must also be issued.
Mode of Sending Notice (Including Agenda and Notes on Agenda)	The company will choose the method of providing the notice, whether it is by hand, speed post, registered post, facsimile, e-mail, or any other electronic method. When a Director designates a specific method of delivery for the Notice, that method must be used to deliver the Notice to the Director. However, if a meeting is held with less notice, the corporation may choose a quicker method of distributing the notice, agenda, and agenda notes.
Address of Sending Notice (Including Agenda and Notes on Agenda)	To the mailing address or email address that the Director registered with the business When a Director designates a specific method of delivery for the Notice, that method must be used to deliver the Notice to the Director. The company should keep records of notices sent, agendas sent, agenda notes sent, and notices of delivery (3 years)
Content of Notice	The Notice must include the meeting’s venue’s entire address, serial number, day, date, time, and means of communication. A note supporting each item of business that has to be approved during the meeting is required. Serial numbers will be assigned to each item of business that will be discussed during the meeting. Any topic not on the agenda may be brought up for discussion with the Chairman’s approval and the support of the majority of the Directors present at the meeting. Supplementary Notes: Any of the agenda items may have supplemental notes circulated at or before the meeting, but these notes may only be discussed with the chairman’s approval and the support of the majority of the directors present, who must include at least one independent director if any. The Notice will advise the Directors of their choice to participate electronically and will provide them with all the essential details. In addition, the Notice must include the phone number(s) or email address (es) of the Chairman, the Company Secretary, or any other person designated by the Board, which the Director must confirm.
the business which is in the nature of Unpublished Price Sensitive Information	With the approval of a majority of the Directors, which must include at least one Independent Director, notes on certain topics may be delivered in a shorter amount of time. At the first Board meeting of each fiscal year, as well as anytime the director changes, general approval for presenting notes on such topics may be obtained. If the required general permission has not been obtained, it must be obtained before the Meeting takes up the relevant topics for discussion. The Minutes must reflect the fact that permission was obtained.
Participation through Electronic Mode:	Unless expressly forbidden, any Director may participate through electronic mode. A Director must notify the Chairman or the Company Secretary in advance if he plans to participate through electronic mode so that they can make the necessary preparations. The Director may also communicate his participation intentions by electronic means at the start of the calendar year, and those communications shall be valid for that calendar year. It shall be presumed that the Director will physically attend the Meeting in the absence of a prior communication or confirmation from him in the manner described above. If the Company Secretary or, in the absence of a Company Secretary, the Chairman or any other Director present at the Meeting, if so authorized by the Chairman, signs the attendance register and the fact of such participation is also noted in the Minutes, it will be assumed that the Directors participating via electronic mode have signed it.
Meeting conducted at a shorter Notice	The Notice must mention that the Meeting is being conducted with a shorter Notice. If at least one Independent Director, if any, is present at such Meeting, the Notice, Agenda, and Notes on Agenda may be delivered earlier than mentioned above in order to conduct urgent business. Decisions made at such a Meeting must be communicated to all the Directors if an Independent Director is not present. These decisions become final only after receiving the approval of at least one Independent Director if any. Unless such decisions were adopted at the Meeting itself by a majority of the Company’s Directors, decisions in cases where the Company lacks an Independent Director shall only be final upon confirmation by a majority of the Company’s Directors.
Frequency of Meetings	A minimum of four meetings of its board are held each calendar year, with no more than 120 days separating any two meetings that are held back-to-back. Within thirty days after the incorporation date, the board will hold its first meeting. If a One Person Company, Small Company, or Dormant, sufficient In each half of a calendar year, the company has one board meeting, with a minimum of 90 days passing between meetings. When an adjourned meeting is a continuation of the previous one, the time between meetings is measured starting from that date. Committee meetings—as frequently as required by any legislation At least one meeting of independent directors every calendar year
Quorum	Throughout the Meeting, a quorum must be present. Directors who are interested are not included in the quorum for the relevant transaction. Except where prohibited, directors participating through electronic mode counted toward the quorum. A board meeting requires a quorum of either two directors or one-third of the board’s total membership, whichever is higher. Any fraction in the aforementioned one-third must be rounded to the nearest whole number. If there are more than or equal to two-thirds of the total number of directors who are interested in voting, the remaining directors present at the meeting, who must number at least two, will constitute the quorum for that issue. Lack of quorum – The meeting will automatically be postponed to the same day, the next week, at the same time and location, or, if that day is a national holiday, to the following day, the following week, which is not a national holiday, at the same time and place. The meeting will be canceled if there is not a quorum at the adjourned meeting as well. If there are fewer than the minimum number of Directors required by the Articles, no business may be conducted until the remaining Directors or a general meeting has increased the number.
Leave of absence	Only when a request for such leave has been made known to the Company Secretary, Chairman, or any other individual designated by the Board to serve as the meeting’s notice-issuer. If a Director Misses all of the Board meetings held over the course of a year, whether or not they request a leave of absence from the Board, their position will become vacant.
Chairman	Board Meeting Schedule: The board’s chairman must also be the company’s chairman. The Directors may choose one among themselves to serve as the Chairman of the Board if the company lacks a Chairman. The Board Meetings will be presided over by the Chairman of the Board. Unless otherwise specified in the Articles, the Directors present at the Meeting shall pick one of themselves to chair and conduct the Meeting if such a Chairman is not chosen or if the Chairman is unable to attend. Commissions’ Meetings: According to the Act or any other legislation or the Articles, the Committee Meetings shall be presided over by a member of the Committee who has been selected by the Board or chosen by the Committee as Chairman of the Committee. Except as otherwise stated in the Articles, the Committee must pick one of its members present to a chair and manage the Meeting of the Committee if no Chairman has been so chosen or if the elected Chairman is unable to attend the Meeting.

FAQs

What is Secretarial Standard-1 (SS-1) on Board Meetings?

Secretarial Standard-1 (SS-1) on Board Meetings is a set of guidelines issued by the Institute of Company Secretaries of India (ICSI) to ensure good corporate governance and uniformity in the practices related to the conduct of Board Meetings. It provides detailed procedures for convening, conducting, and recording minutes of Board Meetings.

Is compliance with SS-1 mandatory?

Yes, compliance with SS-1 is mandatory for all companies except One Person Companies (OPCs) and companies licensed under Section 8 of the Companies Act, 2013. These companies are required to adhere to the guidelines specified in SS-1 for conducting their Board Meetings.

Meaning of Secretarial Standard 1

Scope of Secretarial Standard 1

Secretary Standards’ Benefits

Secretarial Standard-1 on Board Meetings

FAQs

What is Secretarial Standard-1 (SS-1) on Board Meetings?

Is compliance with SS-1 mandatory?

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