Guiding corporates to achieve good governance
CRUNCHING NUMBERS A company secretary advises a company’s board on strategy formulation, compliances besides acting as a link between the board and various stakeholders
Atul H Mehta was not keen on taking up mathematics and statistics during his higher studies and took up a course in company secretaryship instead after a friend advised him to do so. Today, he does not regret his decision and has achieved great success by becoming the president of Institute of Company Secretaries of India.
Over the years, his work has involved preparing project reports, identifying the potential market and clientele, getting reports vetted by banks or public finance institutions, applying for loans from financial institutions before disbursing that money to the shareholders of the company involved.
“Company secretaries act like in-house lawyers, taking care of day-to-day functions/ activities of corporate secretarial department in an organisation,” says Mehta.
They are professionals who take care of governance-related issues in a company and also sign documents that are sent to regulators, including the ministry of corporate affairs, stock exchanges and Securities and Exchange Board of India (SEBI).
They are also responsible for conducting board meetings, preparing the agenda, issuing notices to the board of directors, following up orders for these meetings, and handling legal compliances of an organisation.
The j ob i nvolves giving advice on conducting a business, dealing with situations involving conflict of interest, suggesting ways to prepare financial reports, and developing corporate strategy and assiting in planning.
Besides company law, there are several other laws applicable to organisations doing business. Companies with more than 20 employees are governed by a range of labour laws that include Minimum Wages Act, Bonus Act, Gratuity Act, Factory Act, Foreign Exchange Regulation Act etc. Company secretaries are required to deal with these as well.
Several SEBI regulations apply to a listed company. The regulator expects companies to get their quarterly results published in the media and ensure that they comply with these regulations. Most of these functions are taken care of by a company secretary employed with the firm, says Mehta.
Company secretaries are much sought after. Today, there is demand of approximately 7,000 company secretaries in India, he adds. Every listed company is required to have on its rolls a full-time CS as per Companies Act 2013. In India, there are about 10 lakh companies, out of which a lakh are private limited ones, of which 7,000 are listed in the stock market. About 1,000 of these 7,000 firms are large and are required to employ several these professionals.
When it comes to studying for becoming a company secretary, students must remember that about 90% of the CS syllabus consists of corporate law. Most of these laws also form part of the LLB course. A LLB qualification along with the CS course is an added advantage. Some of the skills that one requires to become a CS include an analytical mind, interest in case studies and laws of the country.
Atul H Mehta, president, The Institute of Company Secretaries of India, pursued a career in law alongside his company secretary course, which, he thinks, gave him an edge over others in the industry.