SEBI Chairman Mr. UK Sinha: A Suitable Innings 

Mr. UK Sinha, Chairman, Securities and Exchange Board of India (SEBI), will leave an indelible mark in the history of the country's capital market regulator for being successful in ensuring that SEBI is empowered on the lines of many other state enforcement agencies to take on securities law offenders.

Mr. Sinha, (Age 62), the first person to be at the helm of the regulator SEBI for more than 3 years since D.R Mehta, introduced many major reforms since he took over on February 18,2011.

His latest pitch for tax benefits for Real Estate Investment Trusts (REITs) was promptly cleared by the new government. This is on the heels of forming a long-term policy for the mutual fund industry.

Here's a look at some of the main changes introduced by Mr. Sinha over the last 4 years:

REVIEW OF CORPORATE GOVERNANCE NORMS FOR LISTED COMPANIES..

The new norms which will be effective from October 1, 2014,capped the number of boards an independent director can serve at 7; enhanced disclosure of remuneration policies; made it mandatory for companies to in place an orderly succession plan for senior management and has done away with stock options for independent directors as part of its broader effort to increase accountability of boards of publicly traded companies.

INSIDER TRADING NORMS..

The SEBI board may soon approve changes to insider trading rules in India.Unlike many developed jurisdictions globally, the SEBI panel has suggested to bring ministers, judges and policy makers having access to price sensitive information under the ambit of the new insider trading norms.

Two NEW WINDOWS FOR CAPITAL RAISING - OFS & IPP..

Introduced in 2012, the Offer for Sale (OFS) route and the Institutional Placement Programme (IPP) offered promoters windows for faster fund raising (within a day). These two avenues have not just helped private firms to raise money, but the government as well by selling shares in state-owned companies.

 Both innovations have been hits thanks to the flexiblity provided by the regulator. Companies have raised over Rs 48,000 crore through the OFS route.

UNIFORM KNOW YOUR CLIENT NORMS ACROSS THE SECURITIES MARKET..

The securities market regulator was the first to replace multiple KYC requirement with uniform rules, which now other regulators are keen to implement for the entire financial sector.

EFFICIENT PRICE DISCOVERY-CALL AUCTION..

SEBI had noticed high volatility on the first day of an IPO listing,to curb price manipulation it introduced the so-called call auction.

This pre-market session helps in better price discovery with certain trade controls in the normal trading session. The regulator mandated that the normal trading session should commence only after the conclusion of call auction session for such scrips on stock exchanges.

CONSENT MECHANISM..

SEBI overhauled this mechanism to ensure more consistency in consent orders and tightened rules by keeping out major securities law violations including insider trading, fradulent activies out of the ambit of such negotiated settlements.

MINIMUM PUBLIC HOLDING NORMS..

The government had first mooted the proposal that atleast a quarter of a company's shares should be held by public shareholders to increase the free-float but because of hectic corporate lobbying these rules could never be enforced all these years. But, it was Sinha who ensured that India Inc. met the deadline 2 years ago.

SEBI persuaded company managements by meeting them initially ,followed up with warning fence-sitters to sell their shares to comply with rules within the deadline.

Src: ET

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