In the ever-evolving landscape of corporate governance, compliance with Secretarial Standards plays a pivotal role in ensuring transparency, consistency, and accountability in boardroom practices. The Institute of Company Secretaries of India (ICSI), recognizing the need to align these standards with contemporary business practices and legislative changes, introduced key amendments to Secretarial Standard-1 (SS-1)—which governs Meetings of the Board of Directors—with effect from April 1, 2024.
These revisions are designed not only to reduce procedural burdens but also to provide greater operational flexibility, especially for startups and smaller entities, without compromising governance principles.
What is SS-1?
Secretarial Standard-1 (SS-1) is a standard issued by ICSI under the authority of Section 118(10) of the Companies Act, 2013. It lays down uniform principles for convening and conducting meetings of the Board of Directors and its committees.
Key areas covered under SS-1 include:
- Frequency and mode of board meetings
- Agenda and notice requirements
- Quorum and attendance norms
- Recording and maintenance of minutes
- Resolutions passed by circulation
What Was the Need for Revision?
The 2024 revision was driven by the following key factors:
1. Alignment with Evolving Legal Framework:
Amendments to the Companies Act and MCA notifications created a need to update SS-1 to avoid overlaps, confusion, or contradictions.
2. Promotion of Ease of Doing Business:
Startups and smaller entities often faced challenges in complying with rigid meeting schedules. The revised SS-1 introduces relaxations aimed at simplifying governance for such businesses.
3. Adoption of Digital Practices:
The increased adoption of digital platforms for board meetings, especially post-COVID, warranted an update to reflect practical realities, including allowing e-participation in key decisions.
4. Clarity and Streamlining:
Feedback from professionals and corporates indicated ambiguities in certain provisions. The revisions address these gaps to ensure better compliance and interpretation.
Revised Applicability of SS-1
Following the 2024 amendments, SS-1 applies to all companies incorporated under the Companies Act, 2013, with the following exceptions:
- One Person Companies (OPCs) with only one director.
- Section 8 Companies (non-profit organizations), except the requirement to record minutes within 30 days of the meeting.
- Private Companies recognized as Startups or a Small Company, which are allowed a relaxed frequency for board meetings.
This revised framework balances the need for corporate discipline with the ease of doing business, especially for emerging enterprises.
Key Amendments in SS-1 (2024)
1. Board Meetings Permitted on National Holidays
Earlier, board meetings could not be held on national holidays. This restriction has now been removed, providing companies the flexibility to convene meetings on any day, including national holidays, as per their convenience. This aligns with the Companies Act now.
2. Participation in Restricted Items via Electronic Mode
Previously, directors could not participate in discussions on certain critical matters—like approval of financial statements, mergers, and takeovers—through video conferencing or other electronic means. The amendment now permits such participation provided a physical quorum is present, promoting inclusivity and reducing logistical constraints.
Although the list of restricted items have been omitted.
3. Clarified the participation of Director through electronic mode
Any director who has given his intention to participate through electronic mode can also participate in the meeting in person provided he gives such intimation in advance to the Company.
4. Meeting of Independent Directors
Earlier atleast one meeting was required to be held in a Calendar Year, now atleast one meeting is required to be in a Financial Year.
5. Clarified regarding reckoning quorum
In case of a Private Company, Director will be reckoned for quorum and entitled to participate in the item in which he is interested after disclosure of interest.
6. Clarified Exemption Criteria
The revised standard clearly outlines the exemption criteria for:
- Section 8 Companies, which continue to enjoy full exemption.
- Startups recognized under DPIIT, which are now explicitly allowed to conduct just one board meeting per half calendar year, with a minimum gap of 90 days between them.
This exemption is only available if the Company has not defaulted in filing it’s Financial Statements or Annual Return with ROC.
FAQs on SS-1 (Post-2024 Amendment)
Q1. Is SS-1 applicable to all companies?
No. SS-1 is not applicable to:
- OPCs with only one director
- Section 8 companies (except as specified)
- Startup-recognized private companies (with relaxed compliance)
Q2. Can board meetings now be held on national holidays?
Yes. The amendment permits board meetings to be held on any day, including national holidays, providing greater scheduling flexibility.
Q3. Are directors allowed to attend meetings via video conferencing for all agenda items?
Yes, directors may now participate electronically in discussions involving restricted items—such as approval of accounts or corporate restructuring—if a physical quorum is present at the venue.
Q4. What is the new board meeting requirement for startups?
Startups can now hold one board meeting in each half of the calendar year, with a minimum gap of 90 days between the two meetings, instead of the usual four meetings per year.
Q5. Does the amendment impact the manner in which minutes are recorded?
No major changes have been made to minute-recording practices, except the clarification that Section 8 companies must continue to record minutes within 30 days, despite other exemptions.
Q6. Does SS-1 applies to all the Committees? No, SS-1 applies to only Statutory Committees of the Board.
Q7. Is SS-1 applicable to Listed Companies? Yes it applies to all the Companies registered under Companies Act, 2013 except otherwise specified.
Q8. Can a startup-recognized private company opt to comply with the full SS-1 voluntarily?
Yes. While exemptions exist, companies—especially those planning fundraising or IPOs—may choose to comply voluntarily to demonstrate sound governance practices.
Q9. Are draft minutes now required to be circulated to directors who did not attend the meeting?
Yes. As per SS-1, draft minutes must be circulated to all directors, including those who did not attend, within 15 days of the meeting, allowing them to offer comments.
Q10. If a director joins late or leaves early during a virtual meeting, how is quorum determined?
Quorum is calculated based on the continuous presence of directors throughout the meeting. If the number of directors drops below the required quorum at any point, the meeting must be adjourned, unless the remaining business is not subject to quorum.
Conclusion
The 2024 amendments to SS-1 mark a significant shift towards simplification and flexibility in corporate compliance, without compromising on the core principles of governance. By easing restrictions around meeting dates, electronic participation, and applicability to smaller entities, the ICSI has taken a progressive step in facilitating smoother board functioning. Companies and secretarial professionals should update their internal processes in line with these changes to ensure continued compliance and efficiency.
Stay Compliant. Stay Informed.
If you’re a company secretary, compliance professional, or board administrator:
- Review your board processes today to ensure they align with the revised SS-1.
- Update your internal documentation and SOPs to reflect the new rules.
- Train your board and teams on the new participation and quorum norms.
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