1. Corporate Governance
Clause 49
by vanshika kaushik
Roll no.-140
PG-3
WE SCHOOL

2. Corporate Governance
Corporate Governance may be defined as “A
set of systems, processes and principles
which ensure that a company is governed in
the best interest of all stakeholders”.
FAIRNESS – TRANSPARENCY –ACCOUNTABILITY

3. Why Clause 49 ?
• To align the provision of the
Listing agreement with newly
enacted companies act
• Disclosure and transparency
on All material matters made
in the annual report
• Responsibilities of board
more stringent

4. .
• Certificate from the auditor
or company secretary
• Provide additional
requirement to strengthen the
corporate governance
framework
• Separate report on corporate
governance

5. Composition of board :
• At least one women director
• At least 50% of the board room should comprise of Non-executive
directors
• If the chairman of the board is executive director or promoter,
then at least half Of the board be comprised of independent
director
• If the chairman of the board of board of Non- executive
director then at least one third of the board should comprised
of independent director.
COMPENSATION OF NON –EXECUTIVE DIRECTOR :
• Fixed by board
• Prior approval of shareholder is required

6. Clause 49 :
• Applicable to all the listed companies (SME
&SME IT PLATFORM)
• Company having paid up capital <=10
crore Net worth <=25 crore

7. REVISED CLAUSE 49:
BOARD MEETING :
• At least 4 meeting in an year with maximum gap between two meeting to
be 4 months
• Board should review compliance report laws and regulations that are
applicable to the Company
• Director can a member in not more than 10 committee and chairman not
more than 5 committees
• Director to furnish annual information about the company and positions
he holds and notification if any changes
Code of conduct :
• It is applicable to all the board of directors and the senior
management of the company it should be displayed on the websites and
duties of independent directors on the website

8. Independent director :
• Person of integrity and posses relevant experience in opinion of board
• Not a promoter or related to company or its holding, subsidiary or
associate company
• Not less than 21 years of age
• The maximum number to serve are restricted to 7
• Whole time director =3 ,Independent Director to 7
• Detailed profile of the independent director should be disclosed on
the website of the company
• Only can receive director’s remuneration.
Executive directors :
• Employ of the company who has in-depth knowledge of the company
• Take part in day to day activity of the company and have a personal
interest in the company
Non executive director :
They are not the employ of the company and are not directly related to
the company eg.: nominee/professional director

9. Role Audit committee :
• Review company’s financial
reporting process and disclosure
of its financial information
• Recommendation for appointment
remuneration and terms of
appointment of auditors of the
company and payment to payment
to statutory auditors
• Review all financial statement
• Approved of the related party
transaction and its condition
• Evaluation of the internal
control & risk management
system

10. Share holders:
• Increased participation in the decision making
• Right to place on agenda of GM & propose resolution
• Adequate mechanism to address grievances of shareholders .
• Protection of minority shareholders from the abusive actions of
controlling shareholder
• Right to be timely informed –date location and agenda
• Right to be informed about the capital structures
• All investor can obtain information about the right before they
purchase
Whistle blower:
• Seek relevant, sufficient and reliable information on timely and
regular basis to participate in corporate governance
• Play a role as whistle blower
• Seek redressal for violation of rights
• Effectively participate in overall in the corporate governance
process

11. Performance evaluation of the
independent director and board
of director done by nomination
committees It should be
disclosed in the annual report

12. THANK YOU