A Board Meeting is a formal meeting of the board of directors of an organization, held usually at definite intervals to consider policy issues and working of the company. The conduct of board meetings is almost entirely regulated by the Companies Act.
What should be the time interval between two board meetings?
According to Section 285 of the Companies Act, a meeting of board of directors of a company shall be held at least once in every three months and at least four such meetings shall be held in every year. Therefore, there cannot be a gap of more than 3 months between two board meetings. For instance if the first meeting takes place on any day before the 31st March in a certain year, then the second meeting would be due in between the time of April and June, on any particular day.
As per the provisions of Companies Act, 1956, a company licensed under Section 25 has the privilege to hold the board meeting at least once in every six months.
When is a Board Meeting held?
The board meeting can be held on any day decided by the members of the board based on their ease and convenience, within the period of three consecutive months. Generally, the meeting is held during the business hours, but the board meetings can also be held outside the business hours, depending upon various factors involved.
Where is a Board Meeting held? There is no restriction on the venue of board meetings. It can be held at any place chosen unanimously by the majority of the board members, as per their ease and convenience.
What are the legal requirements for holding a Board Meeting?
- Any director may call a directors' meeting by giving notice of the meeting to the directors or by authorizing the Company Secretary (if any) to give such notice.
- Notice of any directors' meeting must indicate-
- its proposed date and time;
- where it is to take place; and
- if it is anticipated that directors participating in the meeting will not be in the same place, how it is proposed that they should communicate with each other during the meeting.
- Notice of a directors' meeting must be given to each director, but need not be in writing.
- Notice of a directors' meeting need not be given to directors who waive their entitlement to notice of that meeting, by giving notice to that effect to the company not more than 7 days after the date on which the meeting is held. Where such notice is given after the meeting has been held, that does not affect the validity of the meeting, or of any business conducted at it.
What is the Quorum Required for Board Meeting?
The quorum for a meeting of the board of directors of a company shall be one-third of its total strength, or two directors, whichever is higher.
Provided that where at any time the number of interested directors exceeds or is equal to two-thirds of the total strength, the number of the remaining directors, that is to say, the number of the directors who are not interested present at the meeting being not less than two, shall be the quorum during such time.
What are the consequences of not holding a Board Meeting?
If a meeting of the Board could not be held for want of quorum, then, unless the articles otherwise provide, the meeting shall automatically stand adjourned till the same day in the next week, at the same time and place, or if that day is a public holiday, till the next succeeding day which is not a public holiday, at the same time and place.