WHAT IS MARKET INTEGRITY?

If you have integrity, nothing else matters. If you don’t have integrity, nothing else matters. An American politician, Alan K. Simpson, who represented the US state of Wyoming in the US Senate and the Congress, once made this remarkable statement. Tuhin Kanta Pandey, the chairman of the Securities and Exchange Board of India, last week spoke on investor protection and market integrity.

- RAJAS KELKAR

He argued that market integrity means a market infrastructure resilient to shocks— technical, operational, and behavioural. He emphasised that it meant transparent, fair and orderly transactions with no hidden costs, no preferential access and no manipulation. The role of stockbrokers, who are the intermediaries, matters to you. Sebi regulates them by issuing rules for the game. Their behaviour determines whether you, the investor, believe that you are in a fair game. You will stay away from the market if your trust is exploited.

There are many conflicting issues in India’s capital markets that undermine the fairness of the game.