- Company Law
- Specimen
- Disclosure under Section 197(12) and Rule 5(1) of Companies Rules
- Mehak Chanotiya
September 18, 2026
Disclosure under Section 197(12) and Rule 5(1) of Companies Rules
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A statutory disclosure format included in a company's annual report detailing the ratio of director and key managerial personnel remuneration to median employee remuneration, percentage increases, and compliance with the company's remuneration policy under the Companies Act, 2013.
Disclosure under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014
1. The ratio of the remuneration of each Director to the median remuneration of the employees of the Company for FY [____] and the percentage increase in remuneration of each Director, Chief Executive Officer, Chief Financial Officer and Company Secretary during FY [____]:
|
S. No. |
Name |
Designation |
Ratio of remuneration of director to median remuneration |
% Increase in Remuneration in FY [__] |
|
1 |
[Name] |
Chairman & Managing Director / Executive Director |
[Ratio, e.g. XX.XX:1] |
[%, or –] |
|
2 |
[Name] |
Whole-time Director |
[Ratio, e.g. XX.XX:1] |
[%, or –] |
|
3 |
[Name] |
Non-Executive Director |
[Ratio, e.g. XX.XX:1] |
[%, or –] |
|
4 |
[Name] |
Independent Director |
[Ratio, e.g. XX.XX:1] |
[%, or –] |
|
5 |
[Name] |
Chief Financial Officer |
[Ratio, e.g. XX.XX:1] |
[%, or –] |
|
6 |
[Name] |
Company Secretary & Compliance Officer |
[Ratio, e.g. XX.XX:1] |
[%, or –] |
2. The percentage increase in the median remuneration of employees in the financial year [____]: [__]%
3. The number of permanent employees on the rolls of the Company as on [Date]: [__] Employees
4. Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof, and whether there are any exceptional circumstances for increase in the managerial remuneration:
The average percentage increase in the salaries of employees other than Managerial Personnel in Financial Year [____] was [__]%. The increments given to employees are based on their potential, performance, and contribution, which are benchmarked against applicable industry norms. Further, the average increase in the Managerial Remuneration is [__]%.
5. Affirmation that the remuneration is as per the remuneration policy of the company:
It is affirmed that the remuneration paid is as per the Remuneration Policy, applicable for Directors, Key Managerial Personnel and other employees, adopted by the Company.
For and on behalf of the Board
[Name of Company]
[Name of Signatory]
[Designation, e.g. Chairman and Managing Director]
DIN: [DIN Number]
Date: [DD Month, YYYY]
Place: [City]
Author Bio
Mehak Chanotiya
CS Trainee dedicated to mastering the nuances of Indian corporate law and secretarial practice. View Full Profile
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