Mumbai: The senior management at the Securities and Exchange Board of India (Sebi) is pushing back against a proposed disclosure rule that requires them to publicly state their assets and liabilities. They have cited privacy concerns and potential speculation about their financial details to oppose the disclosure norms, multiple people aware of the development told ET.
A panel led by the former chief vigilance commissioner, Pratyush Sinha, had recommended regulatory officials at the rank of chief general manager and above make their assets and liabilities public to enhance transparency and accountability within the capital-markets watchdog.
The Sebi board is expected to discuss the recommendations of the Sinha panel on December 17.
More than 100 officers, both through the employees’ association and individually, have raised concerns with Sebi’s HR department about the risks associated with such public disclosures, said the people cited above. The senior management is concerned about loss of privacy, unnecessary speculation, and unwanted attention, including from their relatives. “There is significant discontent. Officers don’t mind sharing this information internally, but they see no reason to make it public,” said one of the people cited above.
‘Unwanted Attention’
Another person aware of the objections to Sebi’s HR pointed out that “no other Indian regulator requires such public disclosures from its employees. These could prompt unwanted scrutiny – and even requests from relatives for financial assistance.”
Sebi didn’t respond to ET’s email query.
Currently, Sebi’s executive board members, including the chairperson and employees, must internally disclose any interests that may create conflicts. However, they are not required to disclose their assets and liabilities. These internal disclosures are kept confidential. The board secretary is the custodian of board-member records, while employee records are kept within the organisation.
Non-executive Sebi board members from the finance ministry, corporate affairs ministry and the Reserve Bank of India (RBI) don’t need to make additional disclosures if their parent organisations already require them.
By contrast, in the UK, the Financial Conduct Authority, which regulates the financial services industry, keeps board members’ disclosures confidential with its ethics officer, But it does publicly share broad information, such as their and close family members’ financial interests, directorships and holdings in regulated entities.
The Sinha committee – the first set up under current Sebi chairperson Tuhin Kanta Pandey – was formed in March to review provisions around conflicts of interest and disclosure norms for officials’ properties, investments, and liabilities.
The exercise gained urgency after Pandey’s predecessor Madhabi Puri Buch faced conflict-of-interest allegations that she and Sebi had refuted.
