Sebi Enhances Governance Framework at Market Infrastructure Institutions

The Securities and Exchange Board of India (Sebi) has reinforced its governance framework for Market Infrastructure Institutions (MIIs) like stock exchanges. This includes the appointment of two executive directors to enhance operational oversight and regulatory functions. Sebi has detailed guidelines for appointments, performance assessments, and accountability measures.

The Securities and Exchange Board of India (Sebi) has issued new directives aimed at strengthening the governance framework for Market Infrastructure Institutions (MIIs), including stock exchanges. Central to these reforms is the mandatory appointment of two executive directors (EDs) who will manage critical operations and regulatory functions.

Sebi's circular stipulates that the appointments for these roles must follow an open advertisement process, ensuring candidates possess the requisite experience. The regulator demands that MIIs propose at least two candidates for each position and clarify any changes to their approved compensation package.

The new structure involves comprehensive oversight and assessment mechanisms. Public Interest Directors will conduct annual evaluations of the EDs, aligning with processes used for Managing Directors. These steps are designed to bolster transparency and accountability within the institutions, supporting Sebi's commitment to stronger regulatory and operational excellence.

(With inputs from agencies.)