Eligibility and Registration Process for Independent Directors

By Admin on 2025-08-23

To qualify as an Independent Director, an individual must have integrity, experience, and expertise in fields like finance, law, management, governance, or related disciplines. They should not be promoters, key managerial personnel, or relatives of promoters of the company. As per MCA guidelines, every person proposed to be appointed as an Independent Director must register their name in the Independent Director Data Bank maintained by IICA (Indian Institute of Corporate Affairs). Additionally, most individuals are required to pass an online proficiency self-assessment test within two years of registration. This ensures that directors possess updated knowledge of company law, SEBI regulations, and corporate governance practices.

📌 Example: A retired IAS officer registers in the Data Bank and clears the proficiency test. His expertise in policy and regulation helps a private bank improve compliance with RBI guidelines when he joins its board as an Independent Director.