Resolution Nomination & Remuneration Committee Constitution

A Nomination and Remuneration Committee is required to be constituted under Section 178 of the Companies Act, 2013 by the Board of Directors of every listed public company and the classes of company covered under rule 4 of the Companies (Appointment and Qualification of Directors) Rules, 2014.

Nomination and Remuneration Committee shall consist of 3 or more non-executive directors out of which not less than one-half shall be independent directors. The chairperson of the company (whether executive or non-executive) may be appointed as a member of the Nomination and Remuneration Committee but shall not chair such Committee.

Following template of board resolution can be used for reference while drafting.

SAMPLE

#. To constitute a Nomination and Remuneration Committee

“RESOLVED THAT in accordance with the provisions of Section 178 of the Companies Act, 2013 and rules made thereunder, as amended from time to time, read with Regulation 19 of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, and in accordance with Article ... of the Articles of Association of the company, the Board hereby constitutes a committee of the Board of Directors, named as "Nomination and Remuneration Committee".

FURTHER RESOLVED that the composition of the Nomination and Remuneration Committee shall be as under:

Sl.No.   Name                   Designation   
   1.       .........................    .....................
   2.       .........................    .....................
   3.       .........................    .....................

FURTHER RESOLVED that (Name of the Director), (Designation) be and is hereby nominated as the Chairman of the Nomination and Remuneration Committee and that (Name of the Company Secretary), (Designation) is to act as the Secretary of the Nomination and Remuneration Committee.

FURTHER RESOLVED that the Nomination and Remuneration Committee shall act in accordance with the provisions of the Companies Act, 2013, Articles of Association of the company and the 'terms of reference' specified hereunder.

The responsibilities of the Nomination and Remuneration Committee is —

(i) To formulate the criteria for determining qualifications, positive attributes and independence of a director;

(ii) To recommend to the Board a policy, relating to the remuneration for the directors, key managerial personnel and other employees;

The Nomination and Remuneration Committee, while formulating such a policy, shall ensure that—
 (a) the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate directors of the quality required to run the company successfully;
 (b) relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and
 (c) remuneration to directors, key managerial personnel and senior management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the company and its goals.

(iii) To identify persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, and to recommend to the Board their appointment and removal;

(iv) To specify the manner for effective evaluation of the performance of the Board, its committees and individual directors to be carried out either by the Board, by the Nomination and Remuneration Committee or by an independent external agency and review its implementation and compliance;

(v) To propose to the Board, the members that may form part of the Nomination and Remuneration Committee with the approval of the Board; and

(vi) To do all such acts, deeds and things as may be empowered or allowed under the Companies Act, 2013 and rules made thereunder, including any amendment thereto for the time being in force.”

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NOTE: The resolution sample(s) here is only for reference, to help you with drafting. Do refer the exact provisions of the Act, relevant rules framed thereunder and any other applicable laws to be able to not to miss out anything important while drafting.