Participation by shareholders or Directors in meetings through Video Conferencing

The Ministry of Corporate Affairs has issued General Circulars No. 27/2011 and 28/2011 dated 20thMay 2011 whereby it was clarified that a shareholder or a director of the company may participate in meetings under the provisions of the Companies Act, 1956 through Video Conferencing.

Directors attending through Video Conferencing will also be counted for the purpose of quorum. However, Every director of the company must attend atleast One meeting of Board/Committee of directors personally in a financial year.

At the start of the scheduled meeting through electronic mode, a roll call shall be made by the Chairman/ Secretary. Every director and authorized participant shall state, for the record, Full Name, Location, the fact that he can completely and clearly see and communicate with each of the other participants and will ensure that no one other than the concerned director or authorized participant is attending the meeting through electronic mode. Thereafter, the Chairman/ Secretary shall confirm the participation of the directors in the meeting who are not physically present. After the roll call, the Chairman or Secretary may certify the existence of a quorum.

At the end of the meeting, Chairman of the meeting shall announce the summary of the decisions taken in that meeting in respect of each agenda item and names of the directors who have consented or dissented to those decisions. Video recording of that part of the meeting shall be preserved by the company for one year from the conclusion of that meeting.

Draft minutes of the meeting shall be circulated in soft copy not later than 7 days of the meetingfor comments / confirmation to the directors who attended the meeting to dispel all doubts on matters taken up during the meeting. Thereafter, the minutes shall be entered in the minute books as prescribed under section 193 of the Act, The minutes shall also disclose the particulars of the Directors who attended the meeting through electronic mode.

It is further clarified that it's not mandatory for companies to provide its directors, the facility to attend meetings through video conferencing. In respect of shareholders meetings to be held during financial year 2011-12, video conferencing facility for shareholders is optional. Thereafter, it is mandatory for all listed companies.

Summary

• Every Director must attend personally at least one meeting, a financial year of the company.

• Directors attending through Video Conferencing will also be counted for the purpose of quorum.

• Notice of the Board Meeting shall clearly mention the directors availability of participation through the electronic mode and give information to access the facility.

• Notice seeking confirmation of the presence of Director- physically or through video conferencing.

• Roll call will be necessary at the start and at the end of the meeting.

• At the close of the meeting, the Chairman shall announce the summary of the decisions taken in that meeting in respect to the agenda item and names of the directors in favor and not in favor with it.

• The video recording of closing summary of the meeting by chairman would be preserved for an year.

• Draft minutes of the meeting shall be circulated in soft copy not later than 7 days of the meeting for comments / confirmation to the directors who attended the meeting to dispel all doubts on matters taken up during the meeting. Thereafter, the minutes shall be entered in the minute books as prescribed under section 193 of the Act.

• The minutes shall also disclose the particulars of the Directors who attended the meeting through electronic mode.