The Hindu Business Line : SEBI sets store by fair code for public nominees on SEs

IN a move that will have far-reaching consequences on the functioning of stock exchanges in the post-demutualised era, the Securities and Exchange Board of India (SEBI) has formulated a Code of Conduct for the public representatives on exchanges under which a public nominee or SEBI nominee has to vacate office if the person fails to attend three consecutive meetings or 75 per cent of the total meetings of the board.

The Fair Practices Code was issued to the stock exchanges recently by the capital market regulator. According to the guidelines issued by the SEBI for the exchanges to incorporate in their respective Article of Associations, the public representatives will also have to endeavour for all sorts of regulatory compliances. The move assumes significance as the recommendations of the Justice Kania Committee approved by the SEBI, stipulates that only one third of board members will be public representatives instead of the present 50 per cent.

The scheme stipulates that after separation of ownership rights and trading rights of the present member brokers in the exchanges, one-third of the board will constitute of owner-members while the remaining one third will be the trading membersAccording to the guidelines, the PR directors "shall be liable to vacate his office if he remains absent for three consecutive meetings of the board of directors" and "shall meet at least once in six months separately to exchange views on critical issues."

Article E-Mail :: Comment :: Syndication

Stories in this Section
Industrial growth at 5.7 pc in May

First phase of CAS rollout set for Sept 1

Four in race for 51 pc Govt stake in Engineers India

Want to check attrition, try the Hughes way

Tata Fin board okays pref issue

SEBI sets store by fair code for public nominees on SEs

Corporates go for security software

First case filed under cyberlaw