The role of company secretary has great importance in every stage of company formation. A secretary plays a vital role in the company. Primarily we can differentiate the role of company secretary in three-step which is discussed below:
The overall role of the company secretary can be divided into three (3) types:
- Role of company secretary before incorporation.
- Role of company secretary after incorporation.
- Routine Role of the company secretary.
The above role described below:
A. Role of company secretary before incorporation
Here the company secretary performs the following functions related to incorporation:
- Make an arrangement of meeting for the promoters.
- Submitting necessary forms and documents to the registrar of the joint-stock company for getting a certificate of incorporation, Prepare Memorandum and Articles of Association as per company Act 1994.
B. Role of company secretary after incorporation
Here the company secretary requires performing the below functions:
- Arrange a meeting for the board of directors.
- Prepare and circulate prospectus.
- Collecting certificate of commencement from the registrar of a joint-stock company,
- Arrange a statutory meeting, prepare a statutory report, and file a copy of such report with the registrar of the company.
C. Routine Role of company secretary
Such functions are regular in nature towards the following stakeholders:
1. Functions to Wards Company: These functions are set as per company Act 1994, and other related laws, which are:
- Comply with the rules of company Act 1994; stamp Act and Income Tax Act.
- Sign the Annual Report.
- Maintenance of statutory books or different registers of the company.
- Preparation, validation, and filing of resolutions, agreements, documents, notices, and various returns with the company Registrar.
- Attending the meetings and record their proceedings.
- Keep the common seal in safe custody.
The image given below will give a clear-cut idea about the role of company secretary.
2. Role towards directors: Company secretary performs as a spokesman of the board of directors such as:
- Make sure that all actions of the board of directors are in accordance with the company’s memorandum and articles of association.
- Deal with the correspondence as per instruction from the directors.
- Provide necessary advice and information to the board to formulate company policy.
- Arrange board meetings, issuing notice, and preparing the agenda of such meetings, also recording the minutes and resolutions of the meeting.
- Draft the director’s report and presenting it in the annual general meeting in favor of the directors.
3. Role towards shareholders: Company secretary executes the following functions for shareholders:
- Circulate prospectus, invite and receive share application. Issue allotment letter and share – certificates and arrange distribution of dividend warrants to the shareholders.
- Sending notice and agenda to the ‘shareholders for their respective meetings and make arrangements to hold the meeting.
- Record the proceedings of the meeting in the minute’s book.
- Allowing shareholders to inspect various books and registers as permissible under the company Act 1994.
- Communicate the decisions of the board of directors to the shareholders and deal with the query and complaints of the shareholders.
- Protect the interest of the shareholders.
4. Role related to meeting: Company secretary plays an important role to hold various meeting, such as:
- Select the appropriate place for the meeting.
- Sending notice and agenda of the meeting to the participant.
- Examining the proxy form.
- Announcing the agenda before the meeting.
- Assist the chairman to conduct the meeting.
- Record and maintain the minutes of the meeting.
5. Role as a liaison officer: As a liaison officer, a company secretary has to:
- Maintain liaison between the board of directors and various employees of the company,
- Ensure link between company and stakeholders like shareholders and creditors,
- Circulate orders or instructions at various levels of the company and escalate insights & opinions to the top level.
6. Roles as an administrative officer: Duties towards the office and staff company secretary is a high profile administrative officer of the company and therefore he needs to:
- Supervise and coordinate the activity of various departments like share department, correspondence department, accounts department, filings record department, etc.
- Act like a friend and guide to the staff and ensure equal opportunity for all.
- Handle with query complaints of the staff.
Related Content of Secretarial Function:
- Appointment of Company Secretary in Effective Ways
- Reasons for Dismissal of Company Secretary
- Company Secretary Definition
- Types of Secretary with its Definition
- Company Secretary Qualification and Qualities
- Duties of Private Secretary
- Definition and Qualities or Features of a Private Secretary
- Powers and Rights of Company Secretary
- Legal Status or Position of Company Secretary
- Company Secretary Duties and Responsibilities
- Importance of Company Secretary
- Liabilities of Company Secretary