Independent directors' fee may be capped; MCA proposes higher limit of 25%

The ministry said some urgent amendments are not there in the ordinance but are required for strengthening the corporate governance

The Ministry of Corporate Affairs (MCA) has not dropped the plan to cap independent directors’ remuneration to ensure their independence. However, this did not figure in the latest amendments to the Companies Act, through an Ordinance. 

It has now invited stakeholders’ comments on its proposal to limit the independent directors’ remuneration. However, it proposed a slightly higher cap of 25 per cent of independent directors’ gross income for the remuneration given by a group of companies, than the 20 per cent suggested by the panel. 

It retained the 10 per cent cap for professional services of independent directors to a