1. Shareholders Rights Vigil Mechanism & Corporate Social Responsibility … Companies Act, 2013 – Everthing you need to know.

2. Shareholders Right

3. Minority Shareholders Right Class Action Suit Who can sue Members If Co. having share Capital Not less than 100 Members Such % of Total Members If Co. not having Share Capital Not less than 20% of Total Members Any class of Members or Depositors Depositors Not less than 100 Depositors Such % of Total Depositors

4. Minority Shareholders Right Application to Tribunal To Restrain Co. from doing ultra vires act Co. from doing ultra vires act Co. from breaching MoA or AoA To declare resolution altering MoA or AoA as void Directors on acting on such resolution. co. from breaching any law co. for taking action contrary to the resolution passed To claim damages

5. Minority Shareholders Right Oppression & Mis - Management Affairs of the Co. conducted in a manner pre-judicial to public, Co. or members Material change in the Co. not being in the interest of Creditors, investors, debenture holders, shareholders

6. Minority Shareholders Right Who can apply Members If Co. having share Capital Not less than 100 Members 10% of Total Members Holding 10% of Issued Capital If Co. not having Share Capital Not less than 20% of Total Members

7. Minority Shareholders Right Small Shareholder Director Every Listed Co. may have one Director elected by Small shareholders Request made by 1000 Small Shareholders Or 10% of the total shareholders Whichever is lower  The Company can also appoint a Small Shareholder Director on Suo motu.  Small shareholder for this purpose mean shareholder holding nominal value of Shares of Rs. 20,000/- or less.

8. Shareholders Right Shareholder’s Right  Right to receive Notices of General Meetings, Financial Statements etc.,  Right to Inspect Statutory Registers and Returns  Right to attend and Vote at Meetings  Right to receive Share Certificates  Right to Transfer his Shares  Right to receive Dividend when Declared  Right to have Right Shares  Right to Appoint Directors  Right to dissent and safegaurd his interest on increase in liability.  Right to share surplus of the assets

9. Reporting to Members Extract of the Annual Return Disclosure of Non- acceptance of recommendations given by Audit Committee Number of Meetings of the Board. Statement of declaration given by independent Directors Criteria framed by nomination & remuneration committee comments on qualifications made in Audit and Secretarial audit report. Particulars of loans, guarantees and investments made under Sec. 186 Particulars of contracts and arrangements made under Sec. 188 Statement indicating Annual Performance evaluation of its Board. Disclosing of Composition of CSR committee Details of material orders passed by the Regulators or Courts or Tribunals Many other Details…

10. Reporting to Members Signing of..  Board’s Report By Chairperson (if authorised by the Board) [or] By Chairperson (if authorised by the Board) [or] By 2 Directors (if there is MD, he shall sign). By 2 Directors (if there is MD, he shall sign).  Financial Statements By Chief Executive Officer (If he is a Director) [and] By Chief Executive Officer (If he is a Director) [and] BY Chief Financial Officer [and] BY Chief Financial Officer [and] By Company Secretary [and] By Company Secretary [and] By Chairperson (if authorised by the Board) [or] By Chairperson (if authorised by the Board) [or] By 2 Directors (if there is MD, he shall sign). By 2 Directors (if there is MD, he shall sign).

11. Vigil Mechanism Whistle Blower Mechanism

12. Vigil Mechanism Introduction A Vigil Mechanism is a policy developed by the Board of Directors to detect and avoid, fraud or misconduct by the company. A Vigil Mechanism is a policy developed by the Board of Directors to detect and avoid, fraud or misconduct by the company.

13. Vigil Mechanism Who shall frame Listed Companies Company having Borrowed money of 50 Cr or more from Banks & FI. Companies which accepted Public Deposits Every Company, falls under any of the Category mentioned beside shall establish a Vigil Mechanism for its Directors & Employees to report Genuine Concerns.

14. Vigil Mechanism Motive of Vigil Mechanism  To Detect and Prevent Fraud or Misconduct in the Organisation.  To protect the Interests of Whistle Blower against Victimisation.  To establish Standard Operating Procedures for reporting of unethical events through established mechanism.  To give Direct access to the Chairman of the Audit Committee in appropriate or exceptional cases.

15. Vigil Mechanism Disclosure of Vigil Mechanism Disclosure Companies Website Board’s Report

16. Vigil Mechanism Responsibilities Audit Committee Audit Committee shall look after Vigil Mechanism Audit Committee shall look after Vigil Mechanism In case of conflict of interest of any member of the Committee, he has to recuse himself. In case of conflict of interest of any member of the Committee, he has to recuse himself. Where no Audit Committee is required The Board shall appoint a director to play the role of Audit Committee. The Board shall appoint a director to play the role of Audit Committee. In case of frivolous complaints the committee or the Director may take necessary action. In case of frivolous complaints the committee or the Director may take necessary action. Independent Directors A scertain & ensure that the Company has an adequate and functional Vigil MechanismA scertain & ensure that the Company has an adequate and functional Vigil Mechanism Report concerns of unethical behaviour or suspected fraud or violation on Company Code. Report concerns of unethical behaviour or suspected fraud or violation on Company Code.

17. Corporate Social Responsibility. Corporate Social Responsibility

18. Corporate Social Responsibility. Need for Mandatory Provision. The contribution to CSR made by top 25 listed companies (in terms of sales) is Rs. 1,310 Crore out of the average preceding 3 years profits of Rs. 1,53,490 Crore which is amounting to 0.85% of the total profits.

19. Corporate Social Responsibility. Benefits  Strengthened Brand Positioning  Enhanced Corporate Image  Increased Sales and Market Share  Increased Appeal to Investors  Ability to attract, motivate and retain employees.

20. Corporate Social Responsibility. Triggering Point Net worth of Rs. 500 Crore or more Turnover of Rs. 1000 Crore or more Net Profit of Rs. 5 Crore or more Every Company, during any Financial Year, falls under any of the Category mentioned beside shall constitute a Corporate Social Responsibility Committee.

21. Corporate Social Responsibility. Constitution of Committee  For Companies where appointment of Independent Director is mandatory.  For Companies where appointment of Independent Director is not mandatory.  In a Private Company with 2 Directors.

22. Corporate Social Responsibility. CSR Budget The Board of the Company shall ensure that the Company spends, in every Financial Year at atleast 2% of the average Net Profits of the Company during immediately preceding 3 Financial Years. Net Profits for this purposes of this Section shall be calculated as per the Provisions of Section 381 for Foreign Companies and Section 198 for other Companies.

23. Corporate Social Responsibility. Duties of Committee recommend the amount of expenditure to be incurred formulate and recommend a CSR policy to the board monitor CSR policy from time to time 11 22 33

24. Corporate Social Responsibility. Duties of Board Ensure that activities included in CSR policy are undertaken consider & approve CSR policy recommended by committee. Ensure that company spends, in every financial year, at least 2% of the average net profits 11 22 33

25. Corporate Social Responsibility. Disclosures To Disclose CSR Policy in Board Report. Disclose of CSR Committee Composition in Board Report. Reasons for note spending the CSR Budget Allocated in Boards Report.

26. Corporate Social Responsibility. CSR Activities  Eradicating hunger, poverty and malnutrition  Promoting Education  Promoting Gender Equality.  Ensuring Environmental Sustainability  Protection of National Heritage, Art and Culture  Measures for the benefit of Armed Forces veterans  Training to Promote Sports  Contribution to the Funds set up by Central Government.  Contributions or Funds provided to Technology Incubators  Rural Development Projects

27. Undertaking CSR Activities On its Own In collaboration with other Company Third Party Registered Society, Trust or Sec. 8 Company. Registered Trust, Society or Sec. 8 Company started by Group Companies. Corporate Social Responsibility. Undertaking CSR Activities

28. Corporate Social Responsibility. Restrictions CSR Expenditure is not allowed in the Following Activities: Activities undertaken outside India Activities undertaken only for the purposes of its employees and their Families. Contribution made to the Political Parties Amount spent more than 5% of the CSR Budget for CSR Capacity building Activity not coming under the purview of Schedule VII.

29. Corporate Social Responsibility. Ceasing Effect If the Company ceases to fall under the Triggering Criteria, in three continuous Financial Years, then the Company need not:  Constitute CSR Committee  Comply with the Provision of Section 135 Till such time it does not fall under triggering Criteria.

30. Companies Act, 2013 – Everthing you need to know. Thank You. Meher Kiran Cholkar Asst. Manager meher@rna-cs.com R & A Associates, Company Secretaries.