The terms and conditions of appointment of the Independent Directors of the Company in accordance with the requirements of Schedule IV to the Companies Act, 2013.
Members of our Company have at their Annual General Meeting held on [.] appointed [.] as “Independent Director” of the Company.
Your appointment shall be valid up to [.] unless terminated earlier and it will be subject to the provisions of the Applicable laws.
II. Other Terms and Conditions
1.1 During the Appointment, the Independent Director may be required to serve on one or more of the committees of the Board including Audit Committee and Nomination and Remuneration Committee as the Board may decide.
1.2 [.] is appointed as a Non-Executive Independent Director and will be identified as such in the annual report and other documentation of the Company. If circumstances change, and he believes that his independence will be in doubt, he should discuss the same with the Chairman of the Company as soon as practicable.
2. Duties and Liabilities:
2.1 The Independent Director will perform his fiduciary duties in a responsible manner and his general legal responsibilities to the Company will be at par with as non-executive director.
2.2 The Independent Director will be held liable only in respect of such acts of omission or commission by the Company which has occurred with his knowledge, attributable through Board processes and with his consent or where he has not acted diligently.
2.3 The Independent Director will seek appropriate clarification or amplification of information and, where necessary, take and follow appropriate professional advice and opinion of outside experts at the expense of the Company.
2.4 The Independent Director will strive to attend all meetings of the Board and of the Board committees of which he is a member.
2.5 The Independent Director will strive to attend the general meetings of the Company
2.6 The Independent Director will participate constructively and actively in the committees of the Board in which they are chairpersons or members.
2.7 The Independent Director will ascertain and ensure that the company has an adequate and functional vigil mechanism and to ensure that the interests of a person who uses such mechanism are not prejudicially affected on account of such use.
2.8 The Independent Director will acting within his authority, assist in protecting the legitimate interests of the Company, shareholders and its employees.
2.9 The Independent Director will undertake appropriate induction and regularly update and refresh their skills knowledge and familiarity with the company;
2.10 The Independent Director will where they have concerns about the running of the company or a proposed action, ensure that these are addressed by the Board and, to the extent that they are not resolved, insist that their concerns are recorded in the minutes of the Board meeting;
2.11 The Independent Director will keep themselves well informed about the company and the external environment in which it operates;
2.12 The Independent Director will pay sufficient attention and ensure that adequate deliberations are held before approving related party transactions and assure themselves that the same are in the interest of the company;
2.13 The Independent Director will not disclose confidential information, including commercial secrets, technologies, advertising and sales promotion plans, unpublished price sensitive information, unless such disclosure is expressly approved by the Board or required by law.
2.14 The Independent will report concerns about unethical behavior, actual or suspected fraud or violation of the Company’s code of conduct or ethics policy.
2.15 The Independent Director will not unfairly obstruct the functioning of an otherwise proper Board or committee of the Board.
1. Code for Independent Directors:
1.1 The Company has relied on the declaration of the Independent Director that he meets the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 (the ‘Act”).
1.2 The Independent Director will uphold ethical standards of integrity and probity.
1.3 The Independent Director will exercise his responsibilities in a bona fide manner in the interest of the Company.
1.4 The Independent Director will act objectively and constructively while exercising his duties.
1.5 The Independent Director will devote sufficient time and attention to his professional obligations for informed and balanced decision making
1.6 The Independent Director will not allow any extraneous considerations that will vitiate his exercise of objective independent judgment in the paramount interest of the company as a whole, while concurring in or dissenting from the collective judgment of the Board in its decision making
1.7 The Independent Director will not abuse his position to the detriment of the company or its shareholders or for the purpose of gaining direct or indirect personal advantage or advantage for any associated person
1.8 The Independent Director will refrain from any action that would lead to loss of his independence
1.9 The Independent Director will where circumstances arise which make an independent director lose his independence, the independent director must immediately inform the Board accordingly
1.10 The Independent Director will assist the company in implementing the best corporate governance practices
2.1 During the term of Appointment, the Independent Director will refrain from any action that would lead to loss of his independence
2.2 During the term of Appointment, the Independent Directors are expected not to take up directorship in any company (whether in India or abroad) engaged in the same or similar businesses as that of the Company or in a company, business or undertaking which competes or is likely to compete with the Company or which could otherwise potentially give rise to a conflict with his duties with the Company.
2.3 During the term of Appointment, an Independent Director shall not serve as:
(a) As an independent director in more than the prescribed number of companies and
(b) A committee member of more than the prescribed number of committees (i.e) the Audit Committee, the Nomination and Remuneration Committee and any other Board Committees) including chairmanship of such Committees.
3. Time Commitment
By accepting the Appointment, the Independent Director confirms that he will be able to allocate sufficient time to perform his duties as an Independent Director and attend meetings of the Board or any committee thereof. In addition to such attendance, he will be expected to devote appropriate preparation time ahead of each meeting.
4. Training and Development:
4.1 The Independent Director will be invited to attend ongoing training and familiarization sessions for Directors including site visits.
4.2 The Board members are provided with necessary documents/brochures, reports and internal policies to enable them to familiarize with the Company’s procedures and practices.
4.3 Periodic presentations are made at the Board and Board Committee Meetings, on business and performance updates of the Company, global business environment, business strategy and risks involved.
4.4 Quarterly updates on relevant statutory changes and landmark judicial pronouncements encompassing important laws are regularly circulated to Directors.
5. Separate Meeting
5.1 The Independent Directors of the Company shall hold at least one meeting in a year, without the attendance of non-independent directors and members of management;
5.2 All the independent directors of the Company shall strive to be present at such meeting;
5.3 The meeting shall:
(a) review the performance of non-independent directors and the Board as a whole;
(b) review the performance of the Chairperson of the Company, taking into account the views of the executive directors and non-executive directors;
(c) assess the quality, quantity and timelines of flow of information between the Company management and the Board that is necessary for the Board to effectively and reasonably perform their duties.
6. Evaluation Process:
6.1 The performance evaluation of individual directors shall be done by the entire Board of Directors, excluding the director being evaluated.
6.2 On the basis of the report of performance evaluation, it shall be determined whether to extend or continue the term of appointment of the independent director.
In consideration of the Independent Director’s services, the Company will pay him fees as under;
In addition to the remuneration stated in preceding paragraph, the Company will reimburse Independent Director, or bear and pay, all travel, accommodation or other expenses incurred as a result of him carrying out his duties as a director. The Independent Director may, at the Company’s expense, seek independent legal or other professional advice where necessary to perform his duties and will be entitled to reimbursement of costs incurred in seeking such advice. In these circumstances, he should discuss the issues concerned with the Chairman of the Company in advance.
The Independent Director agrees that both during and after the term of Appointment, he will not disclose confidential information, including commercial secrets, technologies, advertising and sales promotion plans, unpublished price sensitive information unless such disclosure is expressly approved by the Board or required by law.
10. Publication of Letter:
In line with the provisions of Schedule IV to the Act, the letter of appointment will be open for inspection by any member and the Company will also post the terms and conditions of the appointment on the Company’s website.
11. Governing Law:
The Appointment and the terms are governed by the laws of India.
12.1 The appointment construes neither a contract for services nor a service contract.
12.2 There will be no relationship of employer and employee as a consequence of appointment as an Independent Director of the Company.
The Letter of Appointment will be issued under the authority of the Board.