As a senior company secretary suggest the Board-the terms and conditions for the appointment, tenure and vacation of office of small shareholders director with reference to the provisions of the Companies Act, 2013.

Terms & Conditions for Small Shareholders' Director Rule 7 of the Companies (Appointment and Qualification of Directors) Rules, 2014 laid down the following terms and conditions for appointment of small shareholders director, which are as under: Election of small shareholders director: A listed company, may upon notice of not less than: One thousand small shareholders; or one-tenth of the total number of such shareholders, whichever is lower; have a small shareholder director elected by the small shareholders. A Small Shareholders Director may be elected voluntarily by any listed company. Thus, a listed company, may on its own, act to appoint a Small Shareholder's Director. In such a case, no notice from small shareholder(s) is required. Notice of intention to propose a candidate: The small shareholders intending to propose a person as a candidate for the post of small shareholder director shall leave a signed notice of their intention with the company at least 14 days before the meeting under their signatures specifying their details and proposed director's details. The details include name, address, shares held and folio number etc. If the proposer does not hold any shares in the company, the details of shares held, and folio number need not be specified in the notice. Statement by the proposed small shareholders director: The notice shall be accompanied by a statement signed by the proposed director for the post of small shareholder director stating: his Director Identification Number. that he is not disqualified to become a director under the Act; and his consent to act as a director of the company Tenure of office and no retirement by rotation: The tenure of small shareholders' director shall not exceed a period of 3 consecutive years, and he shall not be liable to retire by rotation. Further he shall not be eligible for re-appointment after the expiry of his tenure. Grounds of vacation of office: A Small shareholders' director shall vacate the office if - he incurs any of the disqualifications specified in section 164. the office of the director becomes vacant in pursuance of section 167. he ceases to meet the criteria of independence as provided section 149 (6).