; Unlimited Attempts Allowed
As in line with the modern-day company governance laws, every company’s board should have at least 30% of directors as an unbiased.
The logic is that these unbiased administrators should act as a watchdog of the business enterprise affairs, and test any wrongdoings.
However, realistic life is exclusive.
Often, while that agency is stuck in an economic crisis or gets investigated for fraud, then the business enterprise directors plead lack of know-how of the laws as an excuse to get away with the mess.
But now, not anymore.
PM Modi led BJP Govt is now prepared to mandate exam for independent administrators.
This can exchange so many matters if performed properly.
Passing Exam Mandatory For Independent Directors
Within next two months, the Ministry of Corporate Affairs will introduce a new rule, as in keeping with which independent directors of any enterprise might be required to bypass an exam, else, they received’t be eligible.
This examination can be part of their company literacy, and the questions would encompass Indian agency legal guidelines, ethics, and capital market norms.
This has been showed by way of Corporate Affairs Secretary Injeti Srinivas, as he stated, “We need to demolish the myth that unbiased directors don’t have any fiduciary duty. We want to propagate company literacy to lead them to aware about their duties, roles and duties,”
The desirable news is that the applicants could be allowed limitless tries to bypass this examination, and end up independent directors.
Why This Examination Rule Makes Sense?
Right now, as in step with organisation laws, 30% of the organisation’s board strength have to be of unbiased administrators, and hence, this new rule will at once effect 30% of all directors within the company world.
A huge, massive exchange may be unleashed.
Now, want for this special corporate literacy examination was felt, after the debacle at Infrastructure Leasing & Financial Services (IL&FS).
Deloitte Haskins Sells and KPMG affiliate BSR & Associates, who were auditing this public-private partnership company made massive lapses, and the corporation administrators pleaded lack of information of the whole affair.
Govt. Can also soon ban Deloitte Haskins Sells and KPMG associate BSR & Associates for five years. However just a ban gained’t serve the motive.
In case the administrators of Infrastructure Leasing & Financial Services had acknowledged the basics of corporate governance, then perhaps, this case wouldn’t have arisen.
Having stated that, the proper execution of this proposed rule is vital, which could sincerely make a difference.
We will preserve you up to date, as greater info are available.
Since you have landed here, I am assuming that you have either successfully finished law school or will be graduating soon. Understanding the rigours you have endured, congratulations are certainly in order. But like me, after finishing law school, I am sure you are thinking “okay, I successfully jumped that hurdle, now I need to jump the next and most important one – passing the Bar.”
Taking the Bar exam is much different than taking an exam in law school. Putting aside the logistics, time constraints, and two-day intensity; the Bar exam is put together by the state bar regulatory agencies in an attempt to test for whether a person would be a competent attorney. Thus, the exam is different in many ways as to what you have been exposed to.