Centre may allow small shareholders to choose director

Centre may allow small shareholders to choose director: "Centre may allow small shareholders to choose director

To pave the way for small groups of shareholders to nominate a director on the board of listed companies, the Ministry of Corporate Affairs (MCA) is set to bring in more clarity to a provision in the Companies Act 1956. A senior government official said the provision was dropped in the Companies Bill 2009 but may find place in the revised Bill. Other emerging economies, including China and Brazil, already have a set procedure in place to empower small shareholders.

Ministry of corporate affairs is expected to specify the procedure to be followed by small shareholders to elect their nominee in the revised Companies Bill 2011. The Act of 1956 allowed a group of 1,000 or more small shareholders to appoint their nominee on the company board, but it lacked clarity."