Corporate and Economic Laws · Board of Directors and Key Managerial Personnel

Board Meetings, Committees and Register of Directors

Updated 11 October 2026 · Fact-checked

Board meetings are where directors decide company matters. Committees (Audit, Nomination and Remuneration, Stakeholders Relationship) handle specialised work. Section 170 requires a register of directors and KMP with their shareholdings at the registered office, and a return to the Registrar within thirty days of appointment or any change. Solve questions by identifying the body, then applying its composition and filing rules.

Understand Board Meetings, Committees and Register of Directors

A company acts through its Board. The Board takes decisions at meetings, and for specialised work it forms committees. This page covers the committees and the register of directors and KMP given in the supplied sections. Rules on the number of meetings, notice and quorum are in the related pages on Board meetings, and you should study them alongside this page.

Three committees come from the supplied text. The Audit Committee (section 177) is for every listed public company and other prescribed classes. It has at least three directors, with independent directors forming a majority. The Nomination and Remuneration Committee (section 178(1)) is for every listed public company and other prescribed classes. It has three or more non-executive directors, at least one-half of them independent. The Stakeholders Relationship Committee (section 178(5)) is needed where the company has more than one thousand shareholders, debenture-holders, deposit-holders and other security holders at any time during a financial year. Its chairperson must be a non-executive director.

Each committee has a distinct job. The Audit Committee recommends auditor appointment and remuneration, reviews auditor independence, examines financial statements and the auditor's report, approves related party transactions, scrutinises inter-corporate loans and investments, and evaluates internal financial controls and risk management. It also oversees the vigil mechanism. The Nomination and Remuneration Committee identifies people qualified to be directors or senior management, recommends their appointment and removal, and recommends the remuneration policy. The Stakeholders Relationship Committee considers and resolves security holders' grievances.

Section 170 is about records. Every company keeps at its registered office a register of its directors and KMP. It includes the securities each holds in the company, its holding, subsidiary, subsidiary of its holding company, or associate companies. A return of particulars must be filed with the Registrar within thirty days of every appointment of a director or KMP, and within thirty days of any change.

Key rules to remember

Audit Committee composition (s.177(2)): Minimum 3 directors; independent directors form a majority; Majority of members, including the Chairperson, must be able to read and understand financial statements.
Nomination and Remuneration Committee composition (s.178(1)): 3 or more non-executive directors; at least one-half independent; The chairperson of the company may be a member but cannot chair this committee.
Stakeholders Relationship Committee (s.178(5)): Needed if more than 1,000 security holders at any time in a financial year; Chairperson must be a non-executive director; other members are decided by the Board.
Register of directors and KMP (s.170(1)): Kept at registered office, including securities held in the company, holding, subsidiary, subsidiary of holding company and associate companies; Particulars are as prescribed.
Return to Registrar (s.170(2)): Within 30 days of appointment and within 30 days of any change; Applies to every director and KMP.
Penalty for contravening ss.177 and 178 (s.178(8)): Company: fine ₹1,00,000 to ₹5,00,000; officer in default: penalty of ₹1,00,000; The text as supplied is ambiguous on the officer's penalty figure; check the current text before quoting it. Failure to resolve a grievance in good faith is not a contravention.

How to solve Board Meetings, Committees and Register of Directors questions

Use this method for any question on committees or the register.

1Identify the body or record in question: Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, or the section 170 register and return.
2Check whether the company is covered: listed public company or prescribed class, or for the Stakeholders Relationship Committee, more than 1,000 security holders.
3Count the members and test them against the composition rule: total number, independent share, non-executive status, who chairs.
4For a register or filing question, find the trigger (appointment or change) and apply the thirty-day limit.
5Match the function asked about to the right committee.
6State the consequence of default, if asked, using section 178(8) or the relevant penalty.
7Write a clear conclusion that names the section.

Quickest way: Composition checklist

When to use it: For MCQs and short case questions that give you a committee's members and ask whether it is valid.

Audit: at least 3 directors and independent directors more than half.
Nomination and Remuneration: at least 3, all non-executive, independent at least half.
Stakeholders Relationship: chair must be non-executive; trigger is over 1,000 holders.
Register or return: 30 days, from appointment or change.
Eliminate options that swap these thresholds.

Common mistakes in Board Meetings, Committees and Register of Directors

Saying independent directors need only be one-half on the Audit Committee.
The one-half rule of the Nomination and Remuneration Committee gets mixed in.
Fix: Audit means a majority, so more than half. Nomination and Remuneration means at least one-half.
Allowing the company chairperson to chair the Nomination and Remuneration Committee.
Students notice the chairperson may be a member and assume chairing is also allowed.
Fix: The proviso to section 178(1) lets the chairperson be a member but not chair it.
Applying the Stakeholders Relationship Committee to every company.
The word 'every' from the other committees is carried over.
Fix: It is needed only where security holders exceed one thousand at any time in a financial year.
Stating sixty days or fifteen days for the section 170 return.
Other Registrar filing periods get confused.
Fix: Remember thirty days from appointment, and thirty days from any change.
Limiting the section 170 register to directors' holdings in the company only.
Students read 'shareholding' narrowly.
Fix: It also covers securities in the holding, subsidiary, subsidiary of the holding company and associate companies.

Worked examples

Example 1

Sundaram Textiles Ltd, a listed public company, has an Audit Committee of four directors: two independent directors and two executive directors. Is it validly constituted under section 177?

Show the solution

Section 177(2) needs a minimum of three directors, with independent directors forming a majority.
The committee has four directors, so the minimum is met.
Independent directors are two of four, which is exactly half, not a majority.
A majority of four needs at least three independent directors.

Answer: Not validly constituted. Independent directors are not a majority. It needs at least three independent directors out of four. The company faces the penalty under section 178(8) as applicable.

Example 2

Kaveri Foods Ltd appointed Mr. Rao as Chief Financial Officer on 10 June. On 20 July he was allotted shares of its subsidiary. By when must the company file returns under section 170(2)? What should the register show?

Show the solution

A CFO is key managerial personnel, so section 170 applies.
The appointment return is due within thirty days of 10 June, which is 10 July.
A change in particulars requires a return within thirty days of the change.
The shares in the subsidiary were allotted on 20 July, so the return for that change is due by 19 August.
The register must show his securities in the company and also in its subsidiary.

Answer: The appointment return is due by 10 July and the return for the change by 19 August. The register at the registered office must include his holding in the subsidiary.

Exam tips

Memorise the three composition rules side by side, because MCQs test the swapped thresholds.
In case questions, count members first, then check independent and non-executive status.
Name the section number for each rule in written answers.
For the register, list the five kinds of companies where securities are reported.
Link committee questions to Independent Directors and Key Managerial Personnel, as case studies mix them.

Practice questions from Board of Directors and Key Managerial Personnel

Board Meetings, Committees and Register of Directors in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Board Meetings, Committees and Register of Directors: frequently asked questions

Who must constitute an Audit Committee?

The Board of every listed public company and other prescribed classes of companies. It must have at least three directors, with independent directors forming a majority.

Who can chair the Nomination and Remuneration Committee?

The committee has three or more non-executive directors, at least one-half independent. The company's chairperson may be a member but cannot chair it.

When is a Stakeholders Relationship Committee required?

When the company has more than one thousand shareholders, debenture-holders, deposit-holders and other security holders at any time during a financial year. Its chairperson must be a non-executive director.

What does section 170 require?

The company must keep a register of its directors and KMP at its registered office, showing their securities in the company and related companies. A return must go to the Registrar within thirty days of appointment and of any change.