When shareholders don't buy the numbers

Last month, the resolution to approve the accounts of a direct-to-home service provider was defeated for third time. Regulations need to provide direction regarding the way forward in such instances

Indian regulations give limited discretion to the board for decision-making. This is seen from the list of items on which shareholders are expected to vote — from director appointments, to raising money, to allowing companies to send documents to shareholders using a courier. How does this translate into practice? Once a resolution is placed before shareholders, apart from a few voicing their dissent, it is usually approved, with the execution left to the discretion of company management.

What if a resolution is not approved? If independent directors do not find support, they do not join the board. If an executive director