Panel draws the line for Sebi top brass

Pre-appointment disclosure of assets proposed

- NESIL STANEY & JOYDEEP GHOSH

THE HIGH-LEVEL COMMITTEE (HLC) set up by the Securities and Exchange Board of India’s (Sebi) has proposed an overhaul of the existing conflict-of-interest guidelines to strengthen governance and transparency.

The 98-page report, which was made public on Wednesday, has given proposals to start the process from the pre-appointment stage itself. That is, the candidates may be asked to make preappointment disclosures of all actual, potential and perceived conflicts of interest, both financial and nonfinancial, to the appointing authority.

Once in office, the chairman and whole-time members (WTMs) could be defined as ‘insiders’, under the Insider Trading Regulations. They will also make mandatory disclosure of their assets and liabilities public —a first for the markets regulator.

In addition, besides the top brass, employees with the rank of chief general manager and above need to file such declarations annually.

Importantly, the chairman and WTMs on joining will have to choose one of four options for their preexisting investments — liquidate, freeze, or sell them according to a pre-approved trading plan, or sell them outright with prior approval.