Women Director

By Manisha Chaudhary, Managing Partner and Ravi Kumar, Principal Consultant (August 24, 2021)

The Companies Act, 2013 is the main enactment that governs companies in India. The said Act replaced the erstwhile Companies Act, 1956 and introduced various new concepts in the corporate world such as Corporate Social Responsibility, Internal Audit, Small Companies, One Person Companies etc.

One of such concepts is the concept of Women Director through which Central Government introduced the mandatory representation of women on the board of a company.

Women Director – Provisions under the Companies Act, 2013

Pursuant to the second proviso to section 149(1) of the Companies Act, 2013, such class or classes of companies as may be prescribed, shall have at least one woman director.

Rule 3 of the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended from time to time, prescribes the class or classes of companies for which appointment of at least one woman director has been made mandatory. Pursuant to the aforesaid rules,
(i) Every listed company;
(ii) Every other Public Company having –
a. Paid up share capital of one hundred crores rupees or more; or
b. Turnover of three hundred crores rupees or more

Shall have at least one woman director on their board.

Women Director – Provisions under the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015

Regulation 17 of the aforesaid Regulations known as the LODR Regulations adopted the provisions of the Companies Act, 2013 and requires all listed companies to have at least one woman director on their board. The proviso to the aforesaid regulation 17 further required that the board of directors of the top 500 listed entities shall have at least one independent woman director by April 1, 2019 and the board of directors of the top 1000 listed entities shall have at least one independent woman director by April 1, 2020.

Roles, Duties and Responsibilities of Woman Director

There is no specific separate roles, duties and responsibilities are prescribed by the Companies Act, 2013 for the Woman Director. Accordingly, the duties prescribed under section 166 of the Companies Act, 2013 shall also be the duties of a woman director.

So far, the role and responsibilities of a Woman Director are concerned, apart from the above, the same shall be prescribed by the board of directors of the company concerned and she has to act accordingly. If she is appointed as Managing director/ Whole-Time Director, then her roles and responsibilities shall be of an executive director. However, if she is a non-executive director, then her duties and responsibilities will be restricted in nature.

Being a non-executive director, she will have to attend the board meeting and/ or committee meetings of the company of which she would be a member and shall be liable to perform the duties as entrusted to her by the board from time to time.

Liabilities on a Woman Director
Pursuant to the provisions of section 149(12) of the Companies Act, 2013, a non-executive director, not being a promoter or key managerial personnel, shall be held liable, only in respect of such acts of omission or commission by a company which had occurred with her knowledge, attributable through board processes, and with her consent or connivance or where she had not acted diligently.

However, the liabilities of executive director shall be as prescribed under various provisions of the Companies Act, 2013 and as per the roles and responsibilities casts upon them and accordingly shall be held liable.

Accordingly, a woman director shall also be held liable according to the position being held by her in the board of a company.

In present day world, women are participating and growing in each and every filed of life. The women have proved their potential in the corporate world also even under the erstwhile Companies Act, 1956. The provisions relating to woman director under the Companies Act, 2013 is just to secure the place of woman director on the board of directors of certain classes of companies. Now the corporates world has to ensure that they will be benefited by the views, opinion and experience of woman director by ensuring their effective participation.




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