Company secretaries need to work with adherence to ethics. The existence of the role of the company secretary has evolved over the past five decades. The changes and regulations outline the responsibilities and values. The fifth edition is out in the year 2018. The code of ethics the first edition was out in 1989, the second edition in 2003, the third edition in 2011, and the fourth edition in 2016. This blog details the information given by ICSI for members and council members. The awareness creates the motivation for the students to be perfectly professional.
Ethics has a connection with three factors such as moral attitudes, professional culture, and application. The fifth edition conveys this. The profession, in general, has the qualities of independence, objectivity, competence, integrity, ethical behaviour, confidentiality and acceptance of technical standards. The following points say about the code of ethics for members.
• Amendment 8A of the Companies Act states that private companies with more than ten crore share capital need to appoint a company secretary. And the public unlisted company with more than ten crores and all the listed companies also need to appoint a company secretary.
• The misconduct laws are given in Chapter V.
• The committee investigates the professional misconduct of the company secretary. This committee is known as a disciplinary committee.
• The amended provision gives power to the director to withdraw compliant before or after the complaint registration.
• Section 21 A of the Act describes the various procedures of the council such as removal of name, fine of one lakh and reprimand the ICSI member. Before the actions, the council provide the summary disposal. This explanation is to explain to the member about professional ethics.
• After discussing with the director, the board close the case or ordered further investigation.
• The director and the disciplinary committee are similar to the civil court. The attendance of a person, examination of the oath of a person, the discovery of the document, production of a document, and receiving evidence are the areas of examination.
• As per the sub-section (1) of section 21 the director has to analyse the conduct of the member. He needs to mention the schedule in which the misconduct falls.
• If the director is against the decision of the board, he can file the appeal within ninety days.
• If the professional renders services for incorporation, promotion, amalgamation, formation, restructuring, winding up and reorganisation of companies, he is deemed as a company secretary.
• A member is deemed as company secretary in practice if he is a share transfer agent, an issue house, consultant, or stockbroker.
• If the professional is involved in the professional activities without a certificate of practice, he is liable for misconduct.
• If the Company Secretary in practice join with other partners and form a partnership firm, the certificate of compliance must not exceed eighty numbers.
• If the company secretaries run investment consultancy, he can render advice in the subjects of shares, corporate loans, savings schemes, deposits, and mutual funds. He must not work as a broker to mutual funds, financial institutions or companies.
• The illustrative activities of other misconduct are as follows: the documents of the clients not returned, material misrepresentation, use the assistant’s service for activities that are not professional, under the imprisonment by a civil or criminal court for a term of six months, giving false declaration, and fail to follow ICSI guidelines.
• The dress code for male members is a white full sleeve shirt, navy blue suit with CS logo, tie to the neck and black leather shoes. The dress code female members are Navy blue corporate suit or saree with a navy blue blazer.
• The members need to allot time for the learning programs. 15 programs per year or 30 programs for a block of three years is mandatory for a company secretary.
• Members participating in the non-core learning programs such as indirect taxes, service tax, labour laws, accounting standards, intellectual property rights, competition law and NCLT get fifty per cent PCH extra.
• The group authorship for the articles is allowed for two numbers only.
• The members from remote places write research papers if they find it difficult to attend the learning programs.
• The student gets an exemption for three years if there is approval from the committee.
• The Company secretaries can do advertisements on the website with hyperlinks to the ICSI website. And also publish the photos of the practising company secretary, give minimal information and give advice if the client demand online.
• Model advertisement is available on the ICSI website for reference.
• The law is common to the members and senior management of ICSI. The following points elucidate the rules of the council members.
• The violation of the rules will be taken to the notice of the vice president and president. The council members record their interests through Schedule I.
• The senior members record their interests through schedule II. Conflict of interest with ICSI must be avoided.
• The member and senior member must not take advantage of the situation and act unfairly with the students.
• The members and senior members are not allowed to accept a gift from business dealings.
• The members must not compete with the institute directly or indirectly. The name, institute property or information must not be used for personal gain.
• The members have the liability to safeguard the confidential information of the institute.
• The institute property must be used responsibly. It should not be misused.
• The violation of laws and illegal behaviour is reported to the higher authority.
• Personal information or sensitive information are called insider information. The information that is not available in the public domain is kept secret.
• Sexual harassment, attendance, political activity, collective responsibility, oath, due diligence, ethical culture growth, and administration are the other areas of focus for professional ethics.
• The council will discuss the non-compliance of the code by the members in the meeting.
The junior-level and senior-level members’ codes of conduct have been explained in the above content. Corporate law is the set of rules for the core business. Professional ethics explain the role of a beginner level employee in a given complex situation. The human principle of right and wrong differ in a given situation. Professionally, an ethical code of conduct explains the profession.