After being vetted by the Parliamentary Standing Committee of Finance and various ministries, the Companies Bill 2009 is likely to come up for consideration before the Cabinet in its meeting tomorrow.
"Cabinet is likely take up and approve the Companies Bill, 2009, in its meeting on October 25," a source said.
The new Companies Bill, which was tabled in the backdrop of the Rs 14,000-crore Satyam fraud, promises greater shareholder democracy and stricter corporate governance norms.
The Bill has already been scanned by the Parliamentary Standing Committee of Finance and also by different ministries.
For the first time, the Bill has introduced ideas like Corporate Social Responsibility (CSR), class action suits and a fixed term for independent directors.
Among other things, it also proposes to tighten the laws for raising money from the public. The Bill also seeks to prohibit any insider trading by company directors or key managerial personnel by treating such activities as a criminal offence.
Further, it has proposed that companies should earmark 2% of the average profit of the preceding three years for CSR activities and make a disclosure to shareholders about the policy adopted in the process.
The Companies Bill (2008), which lapsed with the dissolution of the 14th Lok Sabha, was re-introduced in August 2009.
