Independent director means a director who either does not hold any share or hold less than 1% of share of the total paid up capital of the company.
02. He is not a sponsor of the company and is not connected with company’s sponsors or director or share holders.
03. who has not been an executive of the company in immediately preceding 2 (two) financial years;
04. who does not have any other relationship, whether pecuniary or otherwise, with the company or its subsidiary or associated companies;
05. who is not a member or holder, director or officer of any stock exchange;
05. who is not independent director in more than 5 (five) listed companies;
07. who has not been convicted for a criminal offence involving moral turpitude;
08.The independent director(s) shall be appointed by the Board
and approved by the shareholders in the Annual General Meeting (AGM);
Why appoint Independent director:-
In order to ensure good corporate governance. One of the main reasons behind appointing independent directors is to ensure objectivity so that they can evaluate the performance and wellbeing of a company without having any conflict of interest or undue influence.