Capital market regulator SEBI on Monday established a committee to review and make recommendations for further strengthening governance standards at exchanges and other market infrastructure institutions (MIIs).
The development is taking place against the backdrop of alleged corporate governance flaws at NSE, with several issues emerging after an SEBI injunction revealed the existence of a “Himalaya yogi” who could influence the decisions of the former MD and CEO of the scholarship, Chitra Ramkrishna.
Apart from this, Ramkrishna had shared certain internal confidential information including NSE financial and business plans, dividend scenario, financial results, with the yogi and even consulted him on the performance ratings of the exchange’s employees.
The six-member committee will be chaired by G Mahalingam, a former full-time member of SEBI, according to a statement.
The other members of the committee are — MD and CEOs of exchanges NSE and BSE, and custodians — NSDL and CDSL; JN Gupta, MD of Stakeholders Empowerment Services; Aarti Nihalani, partner, Oliver Wyman; Sandip Bhagat, partner, S&R staff; and Uttam Bagri, former chair of the BSE Brokers Forum.
The committee’s mandate includes making recommendations on measures to strengthen the role of the board and the committees of MIIs.
In addition, the panel will review the requirements for appointment and role and responsibility of directors on the board and Key Managerial Persons (KMPs) and develop effective metrics for monitoring various aspects of the functioning of MIIs and KMPs.
The committee will also increase accountability and transparency, review MII information retention and sharing policies, and review the code of conduct and ethics for board directors and KMPs.