Maximum Directorships explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Five separate ceilings apply at once, and the one that binds first is usually not the one people count.
Maximum directorships under the Companies Act
A person shall not hold office as a director, including any alternate directorship, in more than twenty companies at the same time. (For reckoning the limit of directorships of twenty companies, the directorship in a dormant company shall not be included.)
However, the maximum no. of public companies in which a person can be appointed as a director shall not exceed ten. (For reckoning the limit of public companies in which a person can be appointed as director, directorship in private companies that are either holding or subsidiary company of a public company shall be included.)
Maximum directorships under the listing regulations
Regulation 17A regulates the maximum number of directorship, including any alternate directorship that can be held by directors of listed entities. It states that a person shall not be a director in more than eight listed entities with effect from April 1, 2019, and in not more than seven listed entities with effect from April 1, 2020. And a person shall not serve as an independent director in more than seven listed entities.
Further, any person who is serving as a whole-time director/managing director in any listed entity shall serve as an independent director in not more than three listed entities.
It is to be noted that for this purpose, the count for the number of listed entities on which a person is a director / independent director shall be only those whose equity shares are listed on a stock exchange.
First: a private company can consume a public company slot. The section 165 note is explicit — for the ten-public-company limit, directorship in private companies that are either holding or subsidiary company of a public company shall be included.
So a director who counts seven public companies and believes there is headroom may in fact be at or over the limit, because three of their private directorships sit in public groups. The test is the company's position in a group, not the letters after its name.
Second: the executive test cuts the independent limit from seven to three. A person serving as a whole-time director/managing director in any listed entity may hold only three independent directorships — not seven.
The rationale is time and attention. Running a listed company is a full-time role, and the regulation assumes such a person cannot give proper attention to seven other boards as well.
Note also what is excluded from each count. A dormant company does not count towards the twenty. Only entities whose equity shares are listed on a stock exchange count under Regulation 17A — so an entity with only listed debt is outside that count, though it remains inside the section 165 counts.
The practical discipline is to maintain one register with five columns, not a single running total, because the binding constraint moves depending on the mix.
The five ceilings
| Limit | Number | Counting note |
|---|---|---|
| All companies (section 165) | 20 | Includes alternate directorships; excludes dormant companies |
| Public companies (section 165) | 10 | Includes private companies that are holding or subsidiary of a public company |
| Listed entities (Regulation 17A) | 7 | Equity-listed only |
| As independent director (Regulation 17A) | 7 | Equity-listed only |
| As independent director, if a WTD/MD of a listed entity | 3 | The executive role itself is elsewhere |
Before accepting another seat
- Count all current directorships, including alternates; exclude dormant companies.
- Recount public companies, adding private holding and subsidiary companies of public companies.
- Count equity-listed entities separately.
- Count independent directorships within that.
- Ask whether any current role is whole-time director or managing director of a listed entity.
Common mistakes
- Counting maximum directorships from the register of companies without the group test.
- Including debt-listed entities in the Regulation 17A count.
- Overlooking alternate directorships.
- Applying the seven-seat independent limit to a serving managing director.