Ch 4 Cheif executive and other officers Flashcards
(37 cards)
Who is cheif executive of the company?
“chief executive”, in relation to a company means an individual who, subject to the control and directions of the
directors, is entrusted with the whole, or substantially the whole, of the powers of management of the affairs of
the company and includes a director or any other person occupying the position of a chief executive, by whatever
name called, and whether under a contract of service or otherwise.
What is restriction on appointment of cheif executive?
A person who is ineligible to become a director of a company shall not be appointed or continue as the chief
executive of any company.
Discuss the appointment of first cheif executive?
The name of first chief executive shall be determined by subscribers of memorandum. His specified particulars
shall be submitted along with the documents of incorporation.
What is term of office of first cheif executive?
The first chief executive shall hold office up to the
first AGM unless shorter period is fixed by the subscribers at the time of his appointment. He may earlier resign
or be removed from his office.
How subsequent cheif executive is appointed?
The subsequent chief executive shall be appointed within 14 days of the election of the directors themselves or
occurring of casual vacancy in the office of chief executive.
What is term of office of subsequent cheif executive?
The subsequent chief executive shall be appointed for a maximum period of three years.
The chief executive appointed against a casual vacancy shall hold office till the directors elected in the next
election appoint a chief executive. The retiring chief executive can be re-appointed.
State the responsibilities of retiring cheif executive?
Retiring chief executive shall continue to perform his services until his successor is appointed unless:
his office was expressly terminated; or
non-appointment of his successor is due to any fault on his part.
Who determines the terms and conditions of cheif executive?
Terms and conditions
The terms and conditions of appointment of a chief executive are determined by the directors or the company in
general meeting in accordance with the provisions in the articles. The terms and conditions of appointment of a
chief executive nominated by government shall be determined by the Government, in such manner as may be
specified.
Can cheif executive be a director or it is not necessary?
The chief executive, if not already a director, shall be deemed to be a director in addition to his being a chief
executive of the company. He shall be entitled to all the rights and privileges, and subject to all liabilities, of being
a director.
What are the modes for removal of cheif executive?
Chief executive may be removed through any of the following modes at any point in time regardless of any
provisions in the articles or in his appointment to the contrary:
by passing a special resolution in general meeting of the company; or
by passing a resolution in the board of directors meeting supported by at least three-fourth of the
number of directors;
by Government/authority/person authorised by it, where more than 75% of the voting rights are held
by the Government.
What is restriction on cheif executive in case of public company?
In case of a public company, a chief executive, his spouse and minor children are prohibited to engage in a
business which competes with the business of the company in which he is a chief executive or with the business
of any of its subsidiary company.
Prohibition to engage in a competing business applies to which company?
In case of a public company
which type of company is required to appoint a chairman ?
Listed company
How is chairman of company appointed?
The board of a listed company shall within 14 days from date of election of directors, appoint a chairman from
among the non-executive directors.
State the responsibilites of chairman of company?
The chairman shall be responsible for leadership of board and
* ensure that the board plays an effective role in
fulfilling its responsibilities.
* The annual financial statements shall contain a review report by the chairman on
the overall performance of board and effectiveness of role played by board in achieving the objectives.
what is term of office of chairman of company?
The chairman shall hold office for 3 years unless he earlier resigns, becomes ineligible or disqualified or removed
by the directors.
Chairman and cheif executive shall be liable to whom about their responsibilities?
The board shall clearly define the respective roles and responsibilities of chairman and chief executive. The
Commission may specify the classes of companies for which the chairman and chief executive shall not be the
same individual.
Which company is necessarily required to have company secretary?
A public company must have a company secretary, possessing such qualification as may be specified.
Who is company secretary and what is his responsibility?
A “company secretary” means any individual appointed to perform secretarial and other duties customarily
performed by a company secretary and declared as such, having such qualifications and experience, as may be
specified.
The company secretary is responsible for advising the board on compliance of corporate laws and for
maintenance of relevant records and registers.
Share registrar is required to be appointed by which type of company?
Listed companies are required to appoint independent share registrar
What are the responsibilities of share registrar appointed?
Listed companies are further required to appoint independent share registrar to handle the transfer of shares
and all other obligations of the company as an issuer towards shareholder.
*In case of listed companies all
applications for transfer of shares are directed to the share registrar instead of company. The name of share
*registrar of the company is mentioned in the notice of general meetings as well
What is restriction on appointment of sole purchase /sale or distribution agent?
No company (incorporated in Pakistan or outside) which is carrying on business in Pakistan shall, without the
approval of the Commission, appoint any sole purchase, sale or distribution agent.
What is exception to rule of non appointment of sole purchase or sale agent without prior approval of commission?
Company incorporated outside Pakistan are not required to obtain the approval of the Commission for such
appointment (unless the major portion of business of such company or person is conducted in Pakistan).
Chairman is required to be selected from among_________________
Non executive director
