Elements of Company Law - II

Role of Secretary in the Company

A company secretary is a senior level employee in a company who is responsible for the looking after the efficient administration of the company. The company secretary takes care of all the compliances with statutory and regulatory requirements. The role of secretary is threefold; statutory officer, coordinator, administrative officer.

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Role of Secretary in the Company

Apart from the three main roles, the company secretary is also responsible to shareholders, depositors, creditors, debtors, employees etc.  Let’s discuss the three main roles of a company secretary in the company, in a little more depth.

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1. As a Statutory Officer

According to section 203 of the Companies Act, 2013 it is mandatory for public listed companies with a paid up capital of 10 crore or more and other companies with a paid up capital of 5 crores to appoint a full-time company secretary.

Under the Indian Stamp Act, the company secretary is responsible for documents such as the letter of allotment, share certificates, debentures, mortgages and to ensure that issued duly stamped.

The responsibilities of a company secretary have grown over the years. There have been multiple Acts enacted that have increased the number of compliance and regulation tenfold. The company secretary takes care of all this. He serves very important functions, serving as a statutory officer.

role of secretary

(source – law donut)

2. As a Coordinator

The company secretary plays a very important role as a coordinator. He essentially serving as a high-level administrator, managing the company’s business and affairs. The company secretary is responsible for ensuring that the plans laid out by the top level management come into effect, successfully.

He is essentially the link between the top level management and lower level management. This is also his role as an internal coordinator. He also acts a link between the company, its shareholders, the society and the Government. This is his role as an external coordinator.

The company secretary must keep the managing director duly informed about the policies and regulations of various Acts and resolutions passed by the board. He must also keep the Board aware of any changes in Government Policy/Acts. He must also tell them about the company’s obligations under various statutes and give advice on legal matters concerning the company.

Relationship with other Functionaries

The company secretary is responsible for conveying the decisions and policies of the board to middle and lower management who will them implement said decisions and policies. He also then relays back the reports from these managers to the Board.

He deals with communication from outside agencies, like the Government agencies and private institutions the company is involved with. This is to ensure there is no miscommunication and the secretary can verify all compliances and regulations while dealing with external agencies.

Relationship with Trade Unions

The company secretary deals with the trade unions acting as a representative of the company. Negotiations with trade unions are a delicate process so the secretary has to keep a constant record of all discussions and settlements. He also overlooks all agreements made by the company with the trade unions.

He must ensure that any employees charged with misconduct must be properly inquired and all details of the situation made available,  before punishing the employee. The secretary also ensures compliance with provisions of Acts such as the Industrial Disputes Act, Employees Provident Fund, Miscellaneous Provisions Act etc.

role of secretary

(source – education career)

Relationship with Shareholders  

Maintaining a relationship with the shareholders acting as a medium between the board and the shareholder is a very aspect of the secretary’s role as coordinator. He handles all correspondence with shareholders.

The company must ensure that all documents and records demanded by the shareholders must be made available to them within due time. He must also personally deal with them to alleviate their doubts and queries.

Relationship with the Government 

All correspondence with the government is overseen by the company secretary. As a matter of fact, this is to ensure proper and uniform reporting and communication. He must coordinate with the government regarding the changes made in Acts and rules. He will also try and maintain a good relationship with the government, ensuring all compliances and regulations.

3. As an Administrative Officer 

The main role of a secretary as an administrator is to make sure that company activities conform to the company policy, specifically. The company secretary is aware of the organisational structure and thus, how it affects the work output of the company.

Thus, he has a good working knowledge of how well the organisation is functioning. Also, the secretary advises the board and top-level management on how to improve on the organisational structure and administrative practices.

Solved Question for You

Question: What are the three main roles of a company secretary in the company?

Answer: The three main roles that a company secretary plays in a company are thus:

  1. Statutory officer
  2. Coordinator
  3. Administrative officer
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