Members of self-governing professions are required to assume legal and ethical responsibility for their work, as well as to prioritize the public and societal interests. One of the most significant components of the profession is keeping stringent ethical and moral convictions while sticking to high standards of behavior. The Company Secretary (abbreviated “CS”), who is subject to a strict code of conduct in the self-regulated system, is regarded by regulators as an ethical and trustworthy professional whose professional judgment and competence have made an impression in the company sector.
Company Secretary as a Profession
The Companies Act, 2013 clearly retains the obligation for Public as well as Private Companies to have a Company Secretary. The responsibilities of the modern Company Secretary have evolved from being a “note taker” at board meetings or a “administrative employee of the board” to a much bigger position of “advisor to the board” and accountability for the organization’s operations and corporate governance.
One of the most significant positions in a company is that of Company Secretary (CS). A competent Company Secretary manages the legal aspects of a company or sole proprietorship. A controller is responsible for keeping and analyzing the company’s tax returns, preserving records, alerting the board of directors on the company’s financial health, and ensuring compliance with legal and statutory standards. To be able to act professionally as a Company Secretary, an individual must complete professional training and pass examinations.
Company Secretary’s Role under the Companies Act, 2013
The Company’s Secretary is a critical component who must carry out his responsibilities with care. In addition to functioning as a legal mentor, he must guarantee that all business activities adhere to all legal requirements; otherwise, he may be held accountable for misconduct and terminated for deceit or violating the company’s legal rights. The secretary is the organization’s primary point of contact with its owners, board of directors, regulatory bodies, and other stakeholders.
Their functions, according to Section 205 of the Companies Act of 2013, are as follows:
- Ensuring that allotment and registration information is given to the registrar Applying for a share capital increase and monitoring the delivery of allocation share certificates
- Keeping a record of share warrant holders
- Obeying the law and filing annual reports
- The statutory declaration must be released before the commencement certificate may be issued.
- Keeping track of the required books
- Meeting updates and general meeting announcements are disseminated to all members of non-banking financial institutions.
- Financial statements and reports (Balance Sheet and Profit & Loss Statements) must be authenticated and signed.
- File a resolution with the registrar within 30 days.
- Keeping minute records of all board and general meetings
- Adherence to the Act Board
- Ensuring that the company adheres to all required secretarial standards
- To carry out additional duties imposed by the Companies Act
- Confirming and submitting attested returns and forms; supervising the TDS (Tax Deducted at Source) authentication and filing process; ensuring that the correct amount of TDS is deducted from employees’ salaries; ensuring that TDS reports are kept up to date; and ensuring that TDS is properly submitted to the government.
Functions of a Company Secretary as per the Companies Act, 2013
- Ensuring Compliance with Laws and Regulations: One of the most important functions of a company secretary is to ensure compliance with various laws and regulations. The company secretary is responsible for ensuring that the company complies with the provisions of the Companies Act, 2013, and other applicable laws. The company secretary also ensures that the company’s policies and procedures are in line with the relevant laws and regulations.
- Board Meetings and General Meetings: The company secretary is responsible for organizing and conducting board meetings and general meetings. The company secretary prepares the agenda, circulates the relevant documents, and ensures that the meetings are conducted as per the provisions of the Companies Act, 2013.
- Maintaining Statutory Registers and Records: The company secretary is responsible for maintaining various statutory registers and records. These include the register of members, register of directors, register of charges, and minutes of board meetings and general meetings. The company secretary ensures that these registers and records are maintained as per the provisions of the Companies Act, 2013.
- Filing of Forms and Returns: The company secretary is responsible for filing various forms and returns with the Registrar of Companies (ROC). These include annual returns, forms related to the appointment and resignation of directors, and forms related to the issue and transfer of shares. The company secretary ensures that these forms and returns are filed within the prescribed time limits.
- Corporate Governance: The company secretary plays a key role in ensuring good corporate governance. The company secretary ensures that the company follows ethical business practices and adheres to the principles of transparency, accountability, and fairness. The company secretary also ensures that the company’s policies and procedures are in line with the best corporate governance practices.
- Advising the Board of Directors: The company secretary advises the board of directors on various matters, including legal and regulatory compliance, corporate governance, and risk management. The company secretary also provides guidance to the board of directors on the interpretation and implementation of the Companies Act, 2013, and other applicable laws.
- Communication with Shareholders: The company secretary is responsible for communication with shareholders. The company secretary ensures that the company communicates effectively with its shareholders and provides them with timely and accurate information. The company secretary also ensures that the company complies with the provisions of the Companies Act, 2013, related to communication with shareholders.
Qualifications required to work as a Company Secretary
A Company Secretary is required to obey various rules established by the Indian Government from time to time, according to Section 2(24) of the Companies Act, 2013. A CS must also meet the requirements outlined in the Companies (Secretary’s requirements) Rules of 1975.
The Company’s Secretary must be a member of the ICSI – Institute of Company Secretaries of India if the company has a paid-up capital of 50 lakhs.
If the paid-up capital of a Private Limited Company exceeds 50 lakhs, the Secretary must be a member of the ICSI – Institute of Secretaries of India. The Secretary must meet one or more of the qualifications, be an ICSI member, and have a law degree from a reputable university. A member of the Indian Institute of Cost and Works Accountants, a postgraduate degree in Commerce from a respectable university, and a Company Law Diploma from any India Law Institute are all required.
FAQs
Q: How does a company secretary contribute to risk management?
Company secretaries identify, assess, and manage legal and regulatory risks. They ensure that the company operates within the legal boundaries, minimizing the risk of legal disputes and financial penalties.
Q: What is the role of a company secretary?
A company secretary plays a crucial role in ensuring that a company complies with all relevant laws and regulations. They also facilitate communication between the board of directors, management, and shareholders.
Q: What are the primary responsibilities of a company secretary?
Responsibilities include ensuring compliance with statutory and regulatory requirements, maintaining company records, organizing board meetings, preparing agendas and minutes, handling shareholder communication, and advising the board on governance issues.
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