SEBI has announced the target of appointing heads of listed companies
New Delhi:
Given strict regulations, market regulator SEBI has said that a person who is rejected by a shareholder at a meeting can be appointed or reappointed as a chief executive officer or director or full-time director. time, only after providing detailed reasons and ensuring compliance with various conditions.
“The appointment or re-appointment of a person, including as a chief executive officer (MD) or full-time director (WTD) or manager, who has been previously rejected by the shareholder at the meeting, will only be done with the prior approval of the shareholders,” the regulator said in an announcement on Monday.
For the consideration of the appointment or re-appointment of a person who has been previously rejected by the shareholders, a specific explanation and verification by the nomination and remuneration committee of the company and the board of directors is required for the gender nomination. introduce that person.
Under the Companies Act 2013, the board of directors cannot appoint a person who is not elected as a director at the general meeting as an additional director.
However, this does not prohibit the board from re-appointing a person as CEO or WTD, whose appointment to such positions was rejected by the shareholder at the meeting.
Furthermore, the board of directors of a listed institution can continue to appoint such persons as WTD or MD even if the shareholders subsequently decline.
SEBI has revised its Listing of Obligations and Disclosure Requirements (LODRs) related to appointments.
In addition, it has also revised the rules regarding credit rating agencies.
