11 November 2008

New SEBI member appointment - a dark pool

Reliable grapevine has it that the Government has invited applications for the post of 'whole time member' of the Securities and Exchange Board of India (SEBI). A whole time member is the senior-most executive position in SEBI (Chairman of SEBI is also a whole time member under the statute). While this was expected, as one of the three positions occupied by a member is falling vacant in January, this is in sharp contrast to the stated policy of transparency in such appointments a few months ago.


At the time of appointment of Chairman of SEBI (and two members) earlier this year, the position was given wide publicity including sending letters to the three national chambers of commerce with a request to forward them to their members. By contrast, the appointment for RBI governor was kept inhouse and neither publicity nor invitations were sent to anyone. If news of the member's position being out are accurate, then this is a departure from the norm of transparency set earlier this year. It is also a sad reflection of grants of sinecures rather than encouraging professionals from the market to man these senior positions. Given that members of SEBI are adjudicating persons, having powers to take away people's livelihood (barring them from the market), learning on the job is not really an option. A person in such a position should at the least understand the markets even if he or she does not understand regulations.

 See the full post here at my main blog.

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