The new Act focuses on self-disclosures and self-governance. Thus, as drivers of the entire compliance area, Company Secretaries need to remain alert, says Sailesh Dholakia of Allcargo Logistics.
Shailesh Dholakia has been there and done that. Yet, Dholakia who currently handles three portfolios-Company Secretary (CS), Legal and finance at Allcargo Logistics, has already drawn up his next wish list.
“There’s so much to do and learn,” remarks Dholakia while explaining why handling the Intellectual Property Rights (IPR) and company brand and trademark registrations etc. would be exciting. But then, the opportunity to learn something new has always been a key motivator for Dholakia. Starting young, he has already spent 22 years in the industry.
Even while still studying for his B Com, Dholakia spent his evenings at the Bombay Stock Exchange (BSE) working along with his brother. Back then, trading was conducted in the BSE’s trading ring and shares were still not dematerialized, this meant a lot of paperwork needed to be completed once the day’s trading was over. “I prepared ledgers, got to know the share transfer process, rectified trades and sorted out the bad deliveries besides understanding the market dynamics of public issues, rights issues and dividends,” says Dholakia.
The experience also helped him zero in on Company Secretaryship as a career. “The Company Secretarial course was fairly new but my friends and I believed that the profession had a bright future. When a friend handed over the course prospectus, I realized that share market transactions were a part of the course and I already knew most of it,” says Dholakia.
Dholakia took up his first job while still doing the course since he believed it would help him understand the theory better. Shepan Consultants were share registrars and merchant bankers. His three years with them gave him an insight on how to liaison with the Securities and Exchange Board of India (SEBI), Stock Exchanges, Reserve Bank of India, Registrar of Companies besides handling the share transfer and transmission process, dividend distribution and even allotment of shares in a public and rights issue.
Looking back Dholakia says, “While most CS get the opportunity to handle a just a couple of public issues for their company, I handled around 15 such issues. And even though a CS may never have to get into the nitty-gritty of allocating shares to the public, financial institutions, mutual funds and foreign bodies etc., he sure needs to have the knowledge of what goes into it.”
Dholakia also studied law to improve his scope of work. “Unless you are working for a large group, you won’t have enough work, especially if you are working in a small or mid-sized company. So it always makes sense to be ready for more than one portfolio,” says he.
He then joined Parekh Platinum, a listed company involved in the gems and jewelry business. Here he worked as a full time Company Secretary and as an independent in-charge of the Mumbai office; he looked after the compliances under the Companies Act, 1956, Listing Agreement with stock exchanges, Foreign Exchange Regulations and other corporate laws.
When after six years, Dholakia joined Zee Telefilms; it offered him the opportunity to do “Something completely different which dealt with another interesting aspect of a Company Secretary’s job.” Zee Telefilms was the first private multi-channel media pioneer in India and thus there were plenty of buy-back and merger and acquisition opportunities.
When the company decided to demerger the Cable, News and DTH businesses from Zee Telefilms, it was a very specialized job that involved details like preparing the scheme of arrangements, determining the valuation and share swap ratios, handling of court processes besides having to liaison with various statutory and regulatory authorities.“From conceptualization till the end, I was part of the all related activities taking place since I had all the teams working under me. I enjoyed the experience and it added to my skills as a CS,” adds Dholakia.
A firm believer in growing along with the company, Dholakia’s stint with Zee Telefilms lasted for six years. “Staying long enough with the company results in the management trusting you,” says he. According to him, “You need to get that sense of belonging to increase your appetite for higher responsibilities. Else, by the time the management is ready to give you opportunities to showcase your capabilities, it is time for you to leave.”
Dholakia’s current position at Allcargo Logistics, has given him enough opportunities to showcase his skills. An integrated logistics service provider, the company has a presence in 90 plus countries and boasts of 120 group companies. Keeping track of the wide network of operations and the separate laws governing every country, ensure that there is never a dull moment for Dholakia. But he distinctly remembers two big achievements his team managed to pull off. In September-October 2013, the company acquired one US based company and another European based company. Says he, “With teams sitting across different geographies, different time zones while dealing with international financing, getting the cross-border merger and acquisition done within the set deadline was a real feat. We had to be there round the clock.” Personally, Dholakia feels the cross- border deal provided the one experience he had always longed for.
While most CS get the opportunity to handle a just a couple of public issues for their company, I handled around 15 such issues. And even though a CS may never have to get into the nitty-gritty of allocating shares to the public, financial institutions, mutual funds and foreign bodies etc., he sure needs to have the knowledge of what goes into it.
Looking back, Dholakia says his confidence in the profession has paid off. In fact, even the New Companies Act 2013 has recognised the CS as a ‘Key managerial’ person who drives the entire compliance area. But with the recognition, comes greater responsibility cautions Dholakia.
Says he, “There is a paradigm shift in the philosophy of the new Act from the old one and Company Secretaries need to remain alert and watchful. While the old Act depended a lot on the government for approvals, the new Act focuses on self-disclosures and self-governance. Any defaults on disclosures will attract higher penalties. Thus the onus of delivering is now on the CS.”
Certain sections in the New Act have created considerable brouhaha in the corporate world. Dholakia says the confusion stems from different interpretations of the law while adding, “While certain sections do seem anti-industry at first glance, they have been made keeping the interests of the shareholders.”
Dholakia says the government is already addressing issues raised by the industry. “For instance, Section 185-186 that restricted companies from giving loans and advances to directors or entities in which the directors have an interest, has been amended to allow companies to give guarantee, loan or security to their wholly owned subsidiaries,” he says.
One can expect many more amendments and it will be a year before confusions regarding the New Act settle down says Dholakia. In the meanwhile, Company Secretaries will have to keep themselves updated, read about the amendments and more importantly; be ready to learn something new every day.
By Dipta Joshi