Company Secretary in Startups vs. Large Corporations: Duties Compared

Introduction

The role of a Company Secretary (CS) is indispensable in today’s corporate world. They are the backbone of good corporate governance, ensuring the company stays on the right side of the law and runs efficiently. But the way a CS works in a startup is quite different from their role in a large, established corporation. While CS professionals in big companies focus on intricate regulatory frameworks, board coordination, and managing communications with diverse stakeholders, their counterparts in startups often juggle multiple roles—from compliance to fundraising and sometimes even operational tasks.

This article delves into the contrasting responsibilities of a Company Secretary in startups versus large corporations, drawing on the Company Secretaries Act, 1980, Companies Act, 2013 and other relevant legislation.

1. The Legal Foundation for Company Secretaries

Before comparing the two, it’s important to understand the legal duties a Company Secretary is expected to fulfill under Indian law:

Company Secretaries Act, 1980:

• Only members of the Institute of Company Secretaries of India (ICSI) can act as CS.
  
  
• Their primary duty is to ensure the company complies with all corporate laws.
  
  
• They serve as advisors to the board on governance and regulatory matters.
  
  
• CSs are key players in conducting secretarial audits and making regulatory filings.
  
  

Companies Act, 2013:

• Companies with a paid-up capital of Rs.10 crore or more must appoint a full-time CS (Section 203).
  
  
• CS is the compliance officer responsible for filings with the Registrar of Companies (RoC), SEBI (for listed firms), and other authorities.
  
  
• They maintain records of board meetings and shareholder meetings.
  
  
• For listed companies, they ensure compliance with SEBI’s Listing Obligations and Disclosure Requirements (LODR).
  
  

With this framework in mind, let’s see how the CS role differs between startups and large corporations.

2. Company Secretary in a Startup

A. Main Responsibilities

 Startups usually have lean teams and fast-moving priorities. Here, a CS often wears many hats:

• Compliance Basics: Managing company incorporation, Director Identification Number (DIN), Digital Signature Certificate (DSC) filings, and maintaining statutory registers.
  
  
• Regulatory Filings: Handling annual returns like Form MGT-7 and financial statements through AOC-4.
  
  
• Fundraising & Investor Relations: Supporting due diligence for funding rounds, drafting Shareholders’ Agreements (SHA) and Term Sheets, and ensuring compliance related to ESOPs.
  
  
• Advisory Support: Helping founders choose the right legal structure (Private Ltd, LLP, etc.), advising on foreign investment regulations (FEMA), and tax-efficient ownership frameworks.
  
  
• Operational Assistance: Often stepping into HR, contracts, and intellectual property matters, while coordinating closely with legal and finance teams.
  
  

B. Challenges in a Startup Environment

• Budget Constraints: Startups might not have the funds to hire a full-time CS, often relying on part-time consultants or external experts.
  
  
• Regulatory Agility: Frequent changes in ownership, business models, and fundraising demand quick adaptability from the CS.
  
  
• Wearing Multiple Hats: The CS role in startups can extend beyond traditional boundaries, encompassing legal, HR, and even finance responsibilities.
  
  

3. Company Secretary in a Large Corporation

A. Key Duties

In contrast, the CS in large corporations has a more focused and specialized role:

• Governance & Board Support: Organizing board meetings, Annual General Meetings (AGMs), and Extra-Ordinary General Meetings (EGMs); ensuring compliance with SEBI regulations; drafting corporate policies such as insider trading and whistleblower guidelines.
  
  
• Regulatory Compliance: Managing complex filings with multiple regulators (RoC, RBI, SEBI, stock exchanges), conducting secretarial audits (Form MR-3), and overseeing mergers, acquisitions, and corporate restructuring.
  
  
• Stakeholder Communication: Acting as the bridge between the company and shareholders, regulators, and institutional investors; managing disclosures under SEBI’s insider trading rules; promoting transparency in financial reporting.
  
  
• Risk & Compliance Management: Implementing anti-fraud and anti-bribery policies, monitoring legal changes across corporate laws, GST, and labour regulations, and ensuring compliance with Corporate Social Responsibility (CSR) mandates.
  
  

B. Challenges in Large Companies

• Complexity: Managing subsidiaries, joint ventures, and compliance across multiple jurisdictions can be daunting.
  
  
• Accountability: Heightened scrutiny from regulators, auditors, and shareholders increases pressure.
  
  
• Strict Deadlines: Timely submission of quarterly reports, board documents, and compliance filings is critical.
  
  

4. Side-by-Side: Startup CS vs. Large Corporate CS

In startups, the Company Secretary is often engaged on a part-time or consultancy basis, whereas in large corporations, the appointment of a full-time CS is mandatory if the company’s paid-up capital is Rs.10 crore or more. When it comes to compliance, startup CS professionals primarily focus on basic filings with the Registrar of Companies and provide support during fundraising activities. In contrast, CSs in large corporations handle a broader and more complex range of compliance requirements involving SEBI, RBI, MCA, and stock exchanges.

Regarding governance, the CS in a startup usually acts as an advisor to the founders, providing guidance on corporate structure and regulatory matters. Meanwhile, their counterparts in large corporations play a formal role in board governance, participating in committees and ensuring adherence to regulatory frameworks. Operationally, startup CSs tend to be highly involved in areas beyond secretarial duties, including human resources, legal, and finance functions, while CSs in large corporations mostly focus on secretarial and compliance functions.

The risk exposure also differs: startup CSs face challenges related to the company’s survival and dynamic business risks, whereas CSs in large corporations are more concerned with regulatory penalties and potential shareholder litigation. Finally, the workload for a startup CS is often varied and requires multitasking, whereas the work of a CS in a large corporation is typically structured and specialized.

5. Emerging Trends Impacting the CS Role

• Startups Going Public: With unicorns like Zomato and Nykaa listing on stock exchanges, startup CS professionals need to deepen their understanding of SEBI regulations and disclosure norms.
  
  
• Digital Transformation: Portals like MCA21 V3 and SPICe+ demand that CSs become adept with technology-driven compliance processes.
  
  
• Focus on ESG & CSR: Large corporations increasingly rely on CS professionals to oversee sustainability reporting and CSR initiatives.
  
  

Conclusion

Although the Company Secretaries Act, 1980, sets out the core duties of a CS, how those duties play out differs widely between startups and large corporations.

In startups, the CS is a versatile advisor, stepping beyond traditional boundaries to support compliance, fundraising, and operational tasks in a fast-paced, resource-constrained setting. Meanwhile, in large corporations, the CS specializes in managing sophisticated governance frameworks, regulatory compliance, and stakeholder communications within a structured environment.

As India’s corporate ecosystem continues to evolve rapidly, the CS role will keep adapting. Whether working in a scrappy startup or a Fortune 500 company, success hinges on staying abreast of regulatory shifts and balancing compliance demands with strategic business growth.

Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates