Sec 163 Proportional representation
Uday (Article Assistant) (411 Points)
09 August 2018
Pls explain how Cumulative voting protects minority interest
2 Replies
Pranjali
(intern)
(2216 Points)
Replied 09 August 2018
Cumulative voting, as compared to the statutory, allows the shareholders to accumulate their votes and vote in favour of one candidate etc. rather than having to evenly distribute their votes. For eg, if a shareholder has 100 shares , and there are 3 directors to be appointed he can give 300 (3*100) votes to one single candidate which means he gets a better standing in the decision making process. He can also divide it any proportion he likes. whereas under statutory voting, he can give a maximum of 100 votes per candidate. That is how cumulative voting protects the rights of the minority shareholders.
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