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SEBI Introduces Options for Appointment and Removal of Independent Directors

Published on November 18, 2022
Current Context: The Securities and Exchange Board of India (SEBI) introduced a flexible option regarding the appointment and removal of Independent Directors from the board of companies.
SEBI Introduces Options for Appointment and Removal of Independent Directors
  • According to the SEBI, the following parameters will be taken into account for the appointment and removal of Independent Directors:
  1. The threshold for an ordinary resolution
  2. The threshold for the majority of minority shareholders
  • Currently, a special resolution, consisting of at least 75% of “yes” votes from the company’s board, is required for appointment and removal.
  • From now on, if the special resolution for the appointment and removal of Independent Directors doesn’t get the required majority, the two thresholds will be tested.
  • SEBI also introduced several provisions concerning schemes of arrangement for entities having handling of unclaimed amounts pertaining to non-convertible securities of listed entities, listed debt securities, and continuous disclosure norms for entities with listed non-convertible securities.
  • SEBI is a Government of India-owned regulatory authority that was established in 1992 with its headquarters in Mumbai. The current Chairperson of the body is Madhabi Puri Buch.

Question:

Q.1 Recently _______ introduced a flexible option regarding the appointment and removal of Independent Directors from the board of companies.
a. SEBI
b. RBI
c. NABARD
d. SIDBI
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