Code for Independent Directors is prescribed in Schedule IV to the Companies Act, 2013. During the selection process, the Board ensures that there is appropriate balance of skills, experience and knowledge in the Board so as to enable the Board to discharge its functions and duties effectively.
The Board always ensures that the Independent Director proposed to be appointed fulfils the conditions specified in the Act and the Rules made thereunder. The terms and conditions for the appointment of the Independent Director are enumerated below:
Term of Appointment- The appointment of Independent Directors shall be for a term upto 5 (five) years or as may be prescribed under Companies Act, 2013 and rules made thereunder as amended from time to time. The Independent Directors shall not be liable to retire by rotation. The Re-appointment at the end of their tenure shall be considered by the Board of Directors (“the Board) based on the recommendation of the Nomination and Remuneration Committee and the performance evaluation report, subject to the Directors continuing to meet the independence criteria. The Independent Directors may be nominated to be a Member or Chairman of any one or more Committees of the Board.
- The Independent Directors will be appointed as a Non-Executive Independent Director on the Board of Directors of PATANJALI AYURVED LIMITED (hereinafter referred to as “the Company”).
- Appointment of the Independent Directors is subject to approval of the Board of Directors and the Shareholders, as per the provisions of the Companies Act, 2013 alongwith rules made thereunder and other applicable provisions.
- Their appointment is also subject to the maximum permissible Directorships that one can hold as per the provisions of the Companies Act, 2013 and rules made thereunder.
- The Independent Director will not be liable to retire by rotation.
- The term Independent Director should be construed as defined under the Companies Act, 2013 and the Listing agreement.
- The Company has adopted the provisions with respect to appointment and tenure of Independent Directors which is consistent with the Companies Act, 2013 Accordingly, subject to the terms of the Board and Shareholder’s resolution passed by the Board/ Shareholders, the Independent Directors will serve for not more than two terms of upto five years each on the Board of the The Company is at liberty to disengage Non Executive Independent Director earlier subject to compliance of relevant provisions of Companies Act, 2013.
Role and Duties
The role and duties will be those normally required of a Non-Executive Independent Director under the Companies Act, 2013. There are certain duties prescribed for all Directors, both Executive and Non-Executive, which are fiduciary in nature and are as under:
- They shall act in accordance with the Requirements under the Act and Rules framed there under and Company’s Articles of Association.
- To follow the “Code for Independent Directors” as specified under Schedule IV of the Companies Act, 2013;
- Accountability under Directors’ Responsibility Statement which forms part of the Board’s Report to the shareholders.
- They shall act in good faith in order to promote the objects of the Company for the benefit of its members as a whole, and in the best interest of the Company, employees, shareholders, community & for the protection of the
- They shall discharge their duties with due and reasonable care, skill and diligence & shall exercise independent
- They should not involve in a situation in which they may have a direct or indirect interest that conflicts, or possibly may conflict, with the interest of the
- They shall not achieve or attempt to achieve any undue gain or advantage either to themselves or to their relatives, partners or
- They shall not assign their office as Director and any assignments so made shall be
- To apply the highest standards of confidentiality, and not disclose to any person or company, any confidential information concerning the Company.
- To review of Companies business strategy, financial plan and monitor the performance of the Company.
Status of Appointment
The Independent Director will not be an employee of the Company and this letter shall not constitute a contract of employment.
As advised by the Board, during the tenure of office, the Independent Director may be required to serve on one or more of the Committees of the Board established by the Company. Upon any such appointment to any one or more Committees, they will be provided with the appropriate Committee charter which sets out the functions of that Committee.
- The Independent Director will be paid such remuneration by way of sitting fees for meetings of the Board and its Committees as may be decided by the Board and approved by such other persons/Authorities as may be required from time to time.
- For the period of their appointment, the Company shall reimburse them for travel, hotel and other incidental expenses incurred by them in the performance of their roles and duties for the Company at the discretion of the Board.
- An independent director shall not be entitled to any stock option and shall not be covered by any pension
Conflict of Interest
It is accepted and acknowledged that the Independent Director may have business interests other than those of the Company. As a condition to their appointment commencing, they are required to declare any such directorships, appointments and interests to the Board in writing in the prescribed form at the time of their appointment and first board meeting of every financial year or whenever there is any change in such disclosures already made.
All information acquired during the tenure of appointment is confidential to the Company and should not be released, either during the appointment or following termination (by whatever means) to third parties without prior clearance from the Chairman unless required by law or by the rules. On reasonable request, the Independent Director shall surrender any documents and other materials made available to them by the Company.
The Company shall have a Board Evaluation process for the evaluation of the Board, the Committees of the Board and individual Directors, including the Chairman of the Board. The Board shall carry out the evaluation process for the performance of the Board as a whole, Board Committees and Directors. The appointment and re-appointment on the Board for Independent Directors shall be subject to the outcome of the evaluation process.
- An Independent Director may resign from his position at any time and should they wish to do so, they are requested to serve a reasonable written notice on the
- Continuation of their appointment is contingent on their getting re-elected by the shareholders in accordance with provisions of Companies Act, 2013 and the Articles of Association of the Company, from time to time in They will not be entitled to any compensation, if the shareholders do not re-elect them at any time.
- Their appointment may also be terminated in accordance with the provisions of the Companies Act, 2013, Articles of Association of the Company and other applicable provisions.
Subject to the provisions of the Companies Act and other applicable provisions, being an independent director they shall be held liable, only in respect of such acts of omission or commission by a company which had occurred with their knowledge, attributable through Board processes, and with their consent or connivance or where they had not acted diligently with respect of the provisions contained in the Companies Act.
This agreement is governed by and will be interpreted in accordance with Indian law and the engagement shall be subject to the jurisdiction of the Indian courts.