Overview

Directors and Key Managerial Personnel of a Company — what this chapter actually covers

A joint stock company is an artificial legal person — it can own property, sue and be sued, and enter

into contracts, but it has no body of its own and cannot act by itself. It can only act through human

beings appointed to run it. The Board of Directors is the body of such persons the members

(shareholders) elect to manage the company's affairs on their behalf, and the Key Managerial Personnel (KMP) are the specific senior officers the Companies Act, 2013 requires certain companies

to appoint to actually execute the Board's decisions on a day-to-day, whole-time basis.

This chapter is the natural next step after "Members of a Company" in the Maharashtra HSC

Secretarial Practice Std XI syllabus: having studied who OWNS a company (its members), this chapter

studies who actually RUNS it — directors and KMP — and, because a Company Secretary spends a large

part of professional life servicing the Board (convening meetings, recording minutes, filing DIN and

KMP-related e-forms with the Registrar of Companies), a working knowledge of who qualifies to be a

director, how a director is appointed and removed, and what a director may and may not do is core,

practical Secretarial Practice — not abstract company law.

The chapter has five moving parts, in the order this treatment takes them up: (1) the meaning of

"director," the Board of Directors, and the Director Identification Number (DIN); (2) the different

types of directors a company's Board can contain; (3) the number of directors a company must/may

have, and how a director is appointed and qualified; (4) disqualification and removal of directors;

(5) the powers, duties and liabilities of directors; and finally (6) Key Managerial Personnel — who

they are, which companies must appoint them, and how a KMP differs from an ordinary director. All

statutory references in this chapter are to the Companies Act, 2013, the central law that governs

every company registered in India, Maharashtra included — the Maharashtra HSC Secretarial Practice

syllabus studies this same national company law, applied through the lens of a Company Secretary's

day-to-day work.