Skip to main content

SEBI plans to tighten appointment rules for top executives at MIIs

By
SEBI plans to tighten appointment rules for top executives at MIIs
The move comes at a time the Reserve Bank of India (RBI) is said to have raised objections over Axis Bank's decision to reappoint Shikha Sharma
The Securities and Exchange Board of India (Sebi) is planning to tighten rules governing the appointment process for top executives at market infrastructure institutions (MIIs) such as exchanges, clearing corporations and depositories.According to sources, MIIs might have to appoint managing directors (MDs) and chief executive officers (CEOs) afresh after the completion of their tenure. At present, the tenure of MDs and CEOs is extended by the board and is sent for Sebi’s approval without a formal appointment process.
The move comes at a time the Reserve Bank of India (RBI) is said to have raised objections over Axis Bank’s decision to reappoint Shikha Sharma as MD and CEO for the fourth term.“If an MII decides to reappoint an existing person, the nomination and remuneration committee will have to provide justification for the move. The committee will have to perform a thorough performance appraisal of the tenure before pitching for re-appointment,” said a person in the know.
Sources said the issue of reappointment of MDs and CEOs was discussed at the last meeting of a Sebi committee set up to review regulations pertaining to MIIs. The panel is be headed by R Gandhi, former deputy governor of RBI.“Sebi wants to ensure that CEOs at important institutions don’t misuse their position by getting long tenures,” said a source.
The market regulator will firm up its view on the issue once the Gandhi committee submits its recommendations. If the rules around reappointment of MDs and CEOs are tightened, the National Stock Exchange (NSE) and the BSE will have to provide justification for offering further extension to their chiefs.
The tenure of Ashish Chauhan, MD and CEO, BSE, expires in November 2022. Chauhan’s first five-year tenure started in 2012, which was extended by another five years in 2017.Vikram Limaye, MD and CEO, NSE, was appointed for five years last year after Chitra Ramkrishna quit unexpectedly.
The tenure of the heads of both Central Depository Services (CDSL) and National Securities Depository (NSDL) is up for renewal soon.The tenure of G V Nageswara Rao, MD and CEO, NSDL, ends in July. He joined the depository in July 2013. The tenure of P S Reddy, MD and CEO, CDSL, ends later this month.According to reports, Sebi has rejected a five-year extension offered to Reddy by the CDSL board. He had joined in 2012 for a five-year tenure, which was expended by a year in 2017.
The Business Standard, New Delhi, 12th April 2018

Comments

Post a Comment

Popular posts from this blog

Data storage norm splits digital payments industry

By
Data storage norm splits digital payments industry  India’s nascent digital payment industry could be thrown into disarray due to the demand by the Reserve Bank of India (RBI) that all user data be stored within the country, fears an industry grouping, which has termed the decision as “heavy-handed”, even as others, including the country’s largest digital payment provider Paytm, have hailed the move.  In a bid to narrow the growing schism, the industry is planning to send a formal representation to the regulator highlighting its concerns, a top official told ET.  “We are trying to build a consensus on the issue," said the person adding that the representation to the central bank will be ready this week.  RBI on April 6, mandated all payment companies—global and local—to set up data storage facilities within India by October. The stringent six-month deadline has attracted the ire of several sections of the industry that fear it will lead to a disruption of wel...
18 comments
Read more

Sebi to finalise options in commodities today

By
The Commodity Derivatives Advisory Committee of the Securities and Exchange Board of India ( Sebi) will meet on Friday with senior officials of the latter, to give a final shape to the rules on options trading in commodity futures, beside revising the warehousing norms to ensure good delivery on settlement. The decision taken, after discussing with the advisory committee, will be placed before the regulator’s board, to finalise the regulations. According to knowledgeable sources, three commodities in each segment, agricultural and non- agricultural, have been proposed for introducing options. It appears commodities from the soya and guar segments are preferred in the former. From the non- agri segment, it is likely that gold, silver and crude oil will be finalised. All these These have better liquidity and both the National Commodity and Derivatives Exchange and the Multi Commodity Exchange, respectively, will be able to introduce the options. In the equity segments, options ar...
17 comments
Read more

E tailers global warehouses may come under tax net

By
E tailers  global warehouses may come under tax net Warehouses of e-commerce companies based in countries such as Australia, Japan, Italy,  Spain, the Netherlands, and Russia may not be exempted from paying the income tax in India  once the multilateral instrument (MLI) to prevent base erosion and profit shifting (BEPS)  comes into force. BEPS refers to the reporting framework mooted by the Organisation for Economic  Co-operation and Development (OECD) and signed by over 100 countries, including India, to  prevent exploiting gaps and mismatches in tax rules to shift profits by multinational  companies (MNCs) artificially to low-tax regimes. The representatives of 68 countries on June 7 this year signed an agreement (MLI) in Paris  to amend their tax treaties to bring them in alignment with measures to prevent BEPS.  However, there is still time for synchronising tax treaties with the multilateral  instrument. India has submitte...
17 comments
Read more