N K Jain, Secretary and CEO, ICSI, shares the importance of Company Secretary’s role and the challenges that lie ahead for them.
Can you explain the importance of a Company Secretary in an organization?
A Company Secretary (CS) is one of the most vital professional in an organisation who acts as a link between the Board and various stake-holders. He connects the Board with employees, share holders, deposit holders, banks, institutions, stock exchanges, regulatory bodies and authorities, Central and stategovernments, and the society at large.
What is the status of a Company Secretary in an organization today?
In a large corporate, the decision making takes place essentially through a CS whether in terms of marketing strategies or production strategies. Marketing policies cannot be in conflict with the competition law while the production strategies should be aligned with the government policies. A CS also forms a part of all commercial decisions, apart from corporate matters related to the organization like raising funds from the banks and capital markets, mergers, acquisitions, de-mergers, cross-border mergers, arbitrations, intellectual property rights, all legal matters, and more importantly the governance issues. After the recent corporate misgovernance incidences, a CS is sought-after by the industry to have advice on how to upgrade their governance practices, improve their disclosures, enhance transparency and benchmark their current practices with the global ones. He is a conscious keeper of the corporate entity and touches its roots. On the other hand, smaller corporates are yet to realise the importance of the services of a CS.
What are the challenges for a Practicing CS?
As a Practicing CS, one has to maintain very high standards of services to the client. They have to provide a competent, timely and cost effective advice. The way the economy is moving, companies are looking forward to a CS advice as one of the major elements that bothers the Board is the risk of loosing reputation. Today one has to think twice before joining a company’s board, as he needs to be doubly sure whether a company is fully compliant with all the laws, rules and regulations. A smaller company feels that it can’t recruit a fulltime CS, so they avail the services of a Practicing CS.
What is ICSI doing in regards to governance at the level of the students?
Our MOU for exchange programmes with Malaysian Institute of Chartered Secretaries and Administrators (MAICSA) provides Indian students an opportunity to visit Malaysia and undergo training with corporate there to get an international flavor. We want to do similar arrangements with other institutions.
Do you suggest a student to go for job experience before starting their practice?
A student should be clear in his mind about going for practice or job. If it’s the latter, he should directly go for practice. But initially, instead of starting his own practice, he should join a Practicing CS firm and work for 3-5 years and gain adequate experience. Then depending upon his progress and understanding, he should set goals for his practice.
Which are the other nations with which ICSI will be signing MOUs?
We are in discussion with Hong Kong, Singapore, Australia, Kenya, Pakistan, Bangladesh, Sri Lanka, and a few more. They are important as leveraging strengths of one another brings quality.
How is the ICSI’s Peer Review Board (PRB) doing?
The progress is good. The reviewers will soon go to the practicing units and check whether they are following proper practices and in case of gaps, they will be advised. It’s a hand-holding exercise and we don’t want to be seen as a police. We feel this will improve the audit practices and they will achieve more credibility. We are targeting to get about 300 firms of PCS peer reviewed this year.
What is ICSI doing on the placement front?
Placement is one area that has got our attention in a much focused manner. It is one of the most critical areas for us. We have a separate placement and training cell in place headed by one of the Joint Directors. To strengthen the cell, we have also constituted a committee of the council called placement committee so that council also gives a focused attention. Last year we conducted a series of campus placements in Delhi, NOIDA, Kolkata, Chennai, Gurgaon and Mumbai, including Centre for Corporate Governance, Research and Training (CCGRT), in a structured manner. It was done for students who are looking for training avenues with the corporate, for practicing CS and also for fresh members who were looking for jobs.
