(Schedule IV of the Companies Act, 2013)
(Section 149(8) of the Companies Act, 2013)

The Code is a guide to professional conduct for Independent Directors. Adherence to these
standards by Independent Directors and fulfilment of their responsibilities in a professional and
faithful manner will promote confidence of the investment community, particularly minority
shareholders, regulators and Companies in the institution of independent directors.


The Independent Directors shall:

  • 1. uphold ethical standards of integrity and probity;
  • 2. act objectively and constructively while exercising his duties;
  • 3. exercise his responsibilities in a bona fide manner in the interest of the company;
  • 4. devote sufficient time and attention to his professional obligations for informed and balanced
    decision making;
  • 5. not allow any extraneous considerations that will vitiate his exercise of objective independent
    judgment in the paramount interest of the company as a whole, while concurring in or
    dissenting from the collective judgment of the Board in its decision making;
  • 6. not abuse his position to the detriment of the company or its shareholders or for the purpose of gaining direct or indirect personal advantage or advantage for any associated person;
  • 7. refrain from any action that would lead to loss of his independence;
  • 8. where circumstances arise which make an independent director lose his independence, the
    independent director must immediately inform the Board accordingly;
  • 9. assist the company in implementing the best corporate governance practices

The Independent Directors shall:

  • 1. help in bringing an independent judgment to bear on the Board’s deliberations especially on
    issues of strategy, performance, risk management, resources, key appointments and standards
    of conduct;
  • 2. bring an objective view in the evaluation of the performance of Board and Management;
  • 3. scrutinize the performance of management in meeting agreed goals and objectives and
    monitor the reporting of performance;
  • 4. satisfy themselves on the integrity of financial information and that financial controls and the
    systems of risk management are robust and defensible;
  • 5. safeguard the interests of all stakeholders, particularly the minority shareholders;
  • 6. balance the conflicting interest of the stakeholders;
  • 7. determine appropriate levels of remuneration of executive directors, key managerial personnel
    and senior management and have a prime role in appointing and where necessary
    recommend removal of executive directors, key managerial personnel and senior
  • 8. moderate and arbitrate in the interest of the company as a whole, in situations of conflict
    between management and shareholder’s interest

The Independent Directors shall—

  • 1. undertake appropriate induction and regularly update and refresh their skills, knowledge and
    familiarity with the company;
  • 2. seek appropriate clarification or amplification of information and, where necessary, take and
    follow appropriate professional advice and opinion of outside experts at the expense of the
  • 3. strive to attend all meetings of the Board of Directors and of the Board committees of which he
    is a member;
  • 4. participate constructively and actively in the committees of the Board in which they are
    chairpersons or members;
  • 5. strive to attend the general meetings of the company;
  • 6. where they have concerns about the running of the company or a proposed action, ensure that
    these are addressed by the Board and, to the extent that they are not resolved, insist that their
    concerns are recorded in the minutes of the Board meeting;
  • 7. keep themselves well informed about the company and the external environment in which it
  • 8. not to unfairly obstruct the functioning of an otherwise proper Board or committee of the
  • 9. pay sufficient attention and ensure that adequate deliberations are held before approving
    related party transactions and assure themselves that the same are in the interest of the
  • 10. ascertain and ensure that the company has an adequate and functional vigil mechanism and to
    ensure that the interests of a person who uses such mechanism are not prejudicially affected on
    account of such use;
  • 11. report concerns about unethical behaviour, actual or suspected fraud or violation of the
    company’s code of conduct or ethics policy;
  • 12. acting within his authority, assist in protecting the legitimate interests of the company,
    shareholders and its employees;
  • 13. not disclose confidential information, including commercial secrets, technologies, advertising
    and sales promotion plans, unpublished price sensitive information, unless such disclosure is
    expressly approved by the Board or required by law.

1. Appointment process of Independent Directors shall be Independent of the company
management; while selecting Independent Directors, the Board shall ensure that there is appropriate balance of skills, experience and knowledge in the Board so as to enable the Board to discharge its functions and duties effectively.

2. The appointment of Independent Director(s) of the company shall be approved at the meeting
of the Shareholders.

3. The explanatory statement attached to the notice of the meeting for approving the
appointment of Independent Director shall include a statement that in the opinion of the Board,
the Independent Director proposed to be appointed fulfils the conditions specified in the Act
and the rules made thereunder and that the proposed director is independent of the

4. The appointment of Independent Directors shall be formalized through a letter of appointment,
which shall set out :

  • a) the term of appointment;
  • b) the expectation of the Board from the appointed director; the Board-level committee(s) in
    which the director is expected to serve and its tasks;
  • c) the fiduciary duties that come with such an appointment along with accompanying
  • d) provision for Directors and Officers (D and O) insurance, if any;
  • e) the Code of Business Ethics that the company expects its directors and employees to follow;
  • f) the list of actions that a director should not do while functioning as such in the company;
  • g) the remuneration, mentioning periodic fees, reimbursement of expenses for participation in
    the Boards and other meetings and profit related commission, if any.
  • h) The terms and conditions of appointment of Independent Directors shall be open for
    inspection at the Registered Office of the company by any member during normal business

5. The terms and conditions of appointment of Independent Directors shall also be posted on the
company’s website.


The re-appointment of Independent Director shall be on the basis of report of performance

  • 1. The resignation or removal of an Independent Director shall be in the same manner as is
    provided in sections 168 and 169 of the Act.
  • 2. An independent director who resigns or is removed from the Board of the company shall be
    replaced by a new Independent Director within a period of not more than one hundred and
    eighty days from the date of such resignation or removal, as the case may be.
  • 3. Where the company fulfils the requirement of Independent Directors in its Board even without
    filling the vacancy created by such resignation or removal, as the case may be, the requirement
    of replacement by a new Independent Director shall not apply.
  • 1. The performance evaluation of Independent Directors shall be done by the entire Board of
    Directors, excluding the director being evaluated.
  • 2. On the basis of the report of performance evaluation, it shall be determined whether to extend
    or continue the term of appointment of the Independent Director.