Defining A Desired level of Maintaining Secretarial Records in India

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Defining A Desired level of Maintaining Secretarial Records in India

In the absence of a physical presence, the actions of a legal entity like Company is evidenced only by their records. Considering the importance of records, there are extensive provisions made in the Companies Act, Rules and Mandatory Secretarial Standards on how to maintain Secretarial Records, with penalty for non-compliances. Given this importance, we have taken a leaf out of Software Engineering Institute –Capability Maturity Model to define Five-levels at which Secretarial Records can be maintained for a company to evaluate what is desirable. The Five-levels defined here go beyond theoretical concepts and are guided by concrete examples that I have personally observed in my interaction with over 300 Company Secretaries, both in practice and in employment in the last four years.

Possible reasons for varying levels at which secretarial records are maintained could be a result of one or more of the three factors in play:

  1. A belief that private companies are private affairs and hence maintenance of secretarial records at the level mandated is seen as being onerous and not a necessity.
  2. Amicable relations between the shareholders lulling the Board of Directors and the Company Secretary into believing that secretarial records are superfluous and an avoidable cost to be done away with.
  3. Absence of Secretarial records scrutiny by the regulator and instances of defaulters not being punished for non-maintenance of proper secretarial records.

Given this ground reality, secretarial records maintained by a company can be categorized under five distinct levels based on their visibility to different stakeholders.

By | 2018-12-06T12:03:25+00:00 November 5th, 2018|Opinion|0 Comments

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