Quiz on Directors and Corporate Governance

What is the minimum number of directors required for a public company?

• Two

• One

• Three

• Four

How many independent directors are required on the board of a public company?

• One-fourth

• One-third

• One-half

• Two-thirds

Which of the following is NOT a condition for a director to be considered independent?

• Has been an employee of the company in the last year

• Has close family ties with company advisers

• Is a shareholder of the company

• Has served on the board for less than five years

What is the required endorsement for an independent director?

• Simple majority of the Board

• Simple majority of the Annual General Meeting

• Two-thirds majority of shareholders

• Unanimous consent of the Board

Shadow directors shall not be treated as a director for the purpose of:

• Insider Trading

• Derivative proceeding

• conflict of interest

• Execution of documents

What is the minimum notice period required to propose the removal of a director?

• Thirty days

• Fifteen days

• Ten days

• Seven days

How often must a public company hold Board meetings?

• Once a month

• Once a year

• Once every three months

• Once every six months

What is the quorum for a Board meeting?

• Half of total strength

• One director

• 1/3rd of total strength or 2 directors which ever is higher

• 2/3rd of total strength or 2 directors which ever is higher

Which of the following powers can the Board NOT exercise without shareholder consent?

• Making loans

• Selling the whole undertaking

• Issuing debentures

• Borrowing money

What is the consequence of a director violating the conflict of interest provisions?

• Mandatory training on ethics

• No consequence

• Fine equivalent to the loss incurred

• Immediate removal from the Board