The term ‘Company Secretary’ is often associated, rather simplistically, with organising and conduct of meetings of the Board of Directors and General Body of a company. In reality, a Company Secretary (CS) has substantial fiduciary and regulatory responsibilities and is a key connector between the organisation and the Board of Directors for all matters related to compliances with company law, etc. But is a CS relevant in banking?
A CS is one of the principal executives in the company and reports directly to the Managing Director or Chief Executive Officer (CEO). In a corporate ecosystem, the responsibilities of a CS are, by and large, but not exclusively, linked to ensuring compliance with the provisions of company law and the reporting requirements of the Registrar of Companies.
Before the advent of private banking, banks had no reporting requirements vis-a-vis the Registrar of Companies. All that was called for, was to confirm and certify fulfilment of the provisions of the Listing Agreement entered into with the Stock Exchanges. This limited objective was often achieved by recruiting an Officer who was qualified as a CS, but who was not appointed as a CS.
There has been a tectonic shift in the intricacies of credit and deposit products, the asset base, geographies, and structures of banks. Banks are not monolith ivory towers anymore, but keenly conscious of their responsibilities including the accountability to depositors and borrowers, transparency in disclosures, upholding the highest governance standards, discharge of obligations to stakeholders, and sensitivity to civil society.
This has made the post of CS unquestionably crucial in the banking sector for ensuring that policies stay within the ambit of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970/1980.
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He also plays the role of Secretary to the Audit Committee of the Board, monitors and is ultimately responsible for adherence to the clauses of the Listing Agreement, manages relationships with RBI, SEBI, and Ministry of Finance, Government of India, and is a critical contributor to framing and implementation of policies related to corporate governance and corporate social responsibility (CSR)
The constant evolution and dynamism of the banking sector will inevitably widen the canvass for CS to make an imprint. Inputs from CS and their involvement are visible, and slated to increase, in realms such as mergers and acquisitions, inorganic growth, loan syndication, merchant banking, depository activities, and issue of Asian Depository Receipts (ADR) and Global Depository Receipts (GDR).
The emerging prominence of India in the global arena, and the expanding footprints of Indian corporates in global industry will make it incumbent on banks to call upon the knowledge and analytical skills of a CS who is accomplished in evaluating and unravelling the complexities of tax treaties, legislation influencing the setting up of foreign subsidiaries and purchase of assets in foreign countries.
A CS has to be a complete package, with innate ability to visualize the larger picture and future trends, and do that ahead of the competition. What a CS must bring to the table is in-depth knowledge of latest company law, taxation, financial aspects and management techniques.
Excellent communication skills, coupled with versatility in domain expertise, makes a CS the best equipped to build bridges between the Board of Directors and all stakeholders in the bank. Complex loan and deposit products and structures are becoming business differentiators.
A CS could make key contributions to the formulation of risk management strategies that adroitly balance the risk-reward equilibrium of evolving financial structures. And, a CS would be the best person to deal with increased loan delinquencies that call for formulation of recovery policies that are a blend of astute understanding of ground level realities of defaults and measured aggression
The banking world is fast becoming one in which only the fittest will survive and a competent Company Secretary could make the difference. GoI has voiced its opinion that banks should increasingly tap the capital markets for resources to shore up their capital base, and reduce dependence on budgetary support, making the role of the Company Secretary even more critical.
The Company Secretary has come to stay in banks, and as his future role becomes even more central to performance and market share, demand will surge. And, to boot, the post is one that enhances professional reputation, social stature, and personal satisfaction, and with lucrative CTC packages, is also monetarily rewarding.
And if this CS course is combined with a regular B.Com degree and an Advanced Diploma in Banking & Finance, it will catapult your career and create clear differentiation with the rest of the crowd in the job market. TKWs IBF is one such Institute known for providing such a wonderful combination of courses with Delhi University syllabus. Check them out at http://instituteofbanking.org//