The Hindu Business Line : ICSI for secretarial audit of listed cos every 6 months

Speaking to Business Line, they said: "We have suggested that the SEBI prescribe independent secretarial audit once in every six months for all listed companies with its report to be submitted to the board of directors and circulated among the shareholders."

A secretarial audit has wide connotations and includes compliances of all statutory requirements by a company covering areas such as corporate and securities laws, industrial and labour laws, competition and economic laws, environmental laws, and listing agreement, according to professionals.

Commenting on the purpose that such an audit will serve, the sources said: "An independent secretarial audit will go a long way in ensuring implementation of those norms, thereby providing the required comfort and assurances to the entire board, including the independent director, that there has been no legal violation by the company."

Further, it will provide an in-built mechanism to ensure that corrective measures are taken to prevent violation of law, they added.

The independent directors are exposed to onerous liability of non-compliance of laws, and the introduction of secretarial audit will make it easier for them to assume their real responsibility and the real spirit of good corporate governance can thus prevail in the organisation.

On the authenticity of such audits and how independent will it be, the sources said: "Company secretaries undergo rigorous training to gain knowledge and expertise in corporate and securities laws comprising a major part of corporate governance. A company secretary in practice is an independent professional governed by the code of conduct provided in the Company Secretaries Act, 1980."