In the age of start-ups there are Directors who take up the charge of the company as they manage and controls the whole of the undertaking efficiently.
Directors are the representatives of the investors and ensures that the company is moving inna right direction to achieve its objectives. For every startup Board of Directors takes necessary steps to ensure that there is no mismanagement in the company.
Independent Director
Independent Directors are the Directors who are brought from outside to participate in Board Meeting of a company and must not be having any material or pecuniary interest in the Company. Only those who are not having any material or Pecuniary interest in the Company determined by the Board to Directors to become Independent Director of the Company. He is given sitting fees in the Board meetings of the Company.
Appointment of Independent Directors
Appointment of Independent Directors in a Listed and Unlisted Companies is very easy and the same is approves in the meeting of shareholders and Independent Directors are appointed as per the provisions under Companies Act, 2013 and they are as follows-
For Listed Companies- at least one third of the total Directors should be independent Directors.
For unlisted Companies- At least there should be two Directors who are Independent in case of unlisted companies.
- Public companies should be having paid up share capital of 10 crores or more.
- Public companies must be having turnover of Rs. 100 crores or more.
- And public companies who should be having in aggregate, outstanding loans, debentures, and deposits exceeding 50 crore Rupees or more.
Term of Appointment
The appointment is for a term of 5 years commencing from the date of appointment and ending on 6th Annual general meeting of the company following the date of appointment. Such appointment can be terminated at any point of time according to the Companies Act, 2013.
The time period of the Independent Director must not exceed two consecutive periods of 5 years each and can be extended for a second term only after passing a special resolution.
Re-appointment of Independent director
According to the companies Act, 2013 Independent Directors can be reappointed only after the expiry of the second term but such reappointment can be done only after the expiry of three years.
Independent Directors always makes sure that the affairs of the company are conducted in a best way so that organisational objectives can be achieved easily.
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