Economy

Covid impact: Independent directors get time till Dec-end to register in databank

KR Srivats New Delhi | Updated on September 29, 2020 Published on September 29, 2020

MCA also allows conduct of board meetings via video conferencing till December 31

The Ministry of Corporate Affairs (MCA) has given independent directors three more months to register themselves in the online databank launched last December.

Independent directors of companies had to register by September 30 this year, but can now do so till the end of December, the MCA has said. This is the fourth time that the registration timeline is getting extended this year.

Also read: Independent directors face Gordian knot of personal liability

In a separate development, the MCA has also extended by three more months — ie, up to December 31— the window for conduct of board meetings through video conferencing for approval of annual financial statements, audit committee meetings, board’s report, prospectus and approvals relating to amalgamation, mergers etc.

The latest move comes in the backdrop of Covid-19 continuing to affect the functioning of corporates in the country. The MCA has, from time to time, been taking several measures to lighten the compliance burden of companies amid the pandemic. It has already allowed companies to hold their EGMs through video conferencing and other other audio visual means till end-December.

Also read: EGMs: Video conferencing facility extended till Dec 31

Role of databank

It may be recalled that the independent directors databank was jointly launched by the MCA and Indian Institute of Corporate Affairs (IICA) on December 2, 2019. The databank aims to strengthen the institution of independent directors, create a pool of skilled professionals and build an ecosystem to serve existing independent directors, aspiring professionals and companies.

Initially, the MCA wanted independent directors to register within three months, ie, by February, but later extended it by two months, till the end of April. The timeline was extended to end-June and later to end-September. Now, this timeline has been again extended by another three months.

After registration with the databank, the independent directors are required to take an online proficiency self-assessment test conducted by the IICA. The test is based on relevant topics on the functioning of an individual acting as an independent director, such as companies law, securities law, basic accountancy and corporate governance.

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Published on September 29, 2020
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