Disclosures requirements of directors remuneration under new companies act

Under the new Companies Act, 2013, there are specific disclosures requirements for directors' remuneration. The following are the key requirements:

  1. Annual Report: The company is required to disclose the remuneration of its directors in the annual report. The disclosure should include:
    • The name and designation of each director.
    • The remuneration paid to each director, including:
      • Salary or wages.
      • Commission or bonuses.
      • Stock options or other equity-based incentives.
      • Pension or retirement benefits.
      • Any other benefits.
  2. Remuneration Report: The company is required to prepare a separate remuneration report, which should be included in the annual report. The report should provide detailed information on the remuneration of the directors, including:
    • The remuneration policy of the company.
    • The remuneration paid to each director, including the breakdown of the remuneration into its various components.
    • The performance criteria used to determine the remuneration of the directors.
    • The role of the remuneration committee in determining the remuneration of the directors.
  3. Remuneration Committee: The company is required to have a remuneration committee, which should be responsible for determining the remuneration of the directors. The remuneration committee should consist of at least two independent directors.
  4. Disclosure of Related Party Transactions: The company is required to disclose any related party transactions, including transactions with directors or their relatives. The disclosure should include the nature of the transaction, the amount involved, and the date of the transaction.
  5. Disclosure of Shareholding: The company is required to disclose the shareholding of each director, including the number of shares held and the percentage of the total share capital held.
  6. Disclosure of Interests: The company is required to disclose any interests of directors in the company, including:
    • Any interest in a contract or arrangement with the company.
    • Any interest in a transaction with the company.
    • Any interest in a property or asset of the company.
  7. Disclosure of Loans and Credits: The company is required to disclose any loans or credits provided to directors or their relatives, including:
    • The amount of the loan or credit.
    • The terms and conditions of the loan or credit.
    • The date of the loan or credit.
  8. Disclosure of Benefits: The company is required to disclose any benefits provided to directors or their relatives, including:
    • Any benefits in kind, such as cars or housing.
    • Any benefits in the form of loans or credits.
    • Any benefits in the form of insurance or other benefits.

These are the key disclosures requirements for directors' remuneration under the new Companies Act, 2013. The company is required to comply with these requirements to ensure transparency and accountability in the remuneration of its directors.