English

Explain the following Term/Concept: Independent Director.

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Question

Explain the following Term/Concept:

Independent Director.

Short/Brief Note
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Solution

(1) As per Section 149 of the Companies Act. 2013. "Any director other than a Managing Director, Whole Time Director, or a Nominee Director is an Independent Director." He holds office for a term up to 5 consecutive years and is eligible for reappointment. He is expected to possess skills, experience, and knowledge of different fields like law, management. sales, market, administration, corporate governance, and technical process (operation) concerning the company‘s business.

(2) In a listed Public Company, 1/3 % of its total number of directors should independent directors. In other public company at least 2 directors should be independent directors. He cannot hold office for more than 2 consecutive terms.

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Key Managerial Personnel (KMP)
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Chapter 6: Directors and Key Managerial personnel of a company - EXERCISES [Page 100]

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Balbharati Secretarial Practice [English] Standard 11 Maharashtra State Board
Chapter 6 Directors and Key Managerial personnel of a company
EXERCISES | Q 2. 3) | Page 100

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