Market regulator SEBI on Saturday said it will soon come out with detail framework on corporate governance structure that could also include a number of directorship a person can hold as an independent director.
The Securities and Exchange Board of India (SEBI) in its next board meeting will take up a proposal of new corporate governance norms for approval and after the board’ nod it will come out with detailed guidelines, Chairman U.K. Sinha said here on the sidelines of an ANMI function.
The new Corporate Governance models deal with CEO salaries, succession planning and whistle-blower policy at listed companies.
SEBI, which has put out a discussion paper in January in 2013, have been waiting for the Companies Bill to get passed that finally passed in late last year and the new Act is now being implemented.
“…hopefully very soon in our next meeting of the SEBI’s board, we will be taking up the proposal (about corporate governance structure) for the approval. Once, we will get approval, details of the proposals will be announced,” Mr. Sinha said.
When asked about whether a board-cap would be imposed on an independent director holding a position in a company, Mr. Sinha said, “this will be discussed in SEBI’s board meeting and when we come up with our corporate governance guidelines.”
“This will be one of the items to be discussed there,” he added.
As per Companies Act, one person can be an independent director on a maximum of 10 public companies, while SEBI in its draft norms had proposed the cap even lower for listed companies.
Regarding SEBI’s search and seizure powers, Mr. Sinha said that the regulator has kept check and balances on this power.
There is a sense of safety and security among gullible investors that SEBI is taking some effective action.
In the matter of Financial Technologies’ fit and proper status to run MCX-SX, Mr. Sinha said “rules and procedures will be followed and we will take appropriate action.”
Earlier this week, SEBI had summoned Financial Technologies, the promoter of MCX-SX, to explain its fit and proper status to run the stock exchange.