The Companies Bill that was approved by Union Cabinet late on Thursday night is likely to be tabled in the ongoing Winter Session. This will change the key provisions of more than 50-year old Companies Act, 1956.The reforms in the Companies Act, 1956 were started after the Satyam scam exposed the weakness in the corporate governance framework, the role of auditors and independent directors.What will change:
*New corporate responsibility (CSR) framework, greater shareholder democracy and stricter corporate governance norms
*The bill suggests that profit-making cos above a certain threshold will have to spend at least 2% of the average profits in the preceding three years on CSR activities
* It proposes to introduce class action suits and a fixed term for independent directors
* It proposes to tighten laws for raising money from the public
* It seeks to prohibit any insider trading by company directors or key managerial personnel by treating such activities as a criminal offence
* The Bill aims to give more powers to the Serious Frauds Investigation Office
* Introduces new concepts like one person company, class action suits and women directors on boards
* Sebi Act will be made supreme in market-related conflicts
