Introduction: The Securities and Exchange Board of India (SEBI) has unveiled a novel strategy to bolster regulatory adherence within the financial sector. In a bid to enhance the ease of implementing regulations, SEBI introduced the concept of an Industry Standards Forum. This forum, backed by prominent industry associations and guided by experienced leaders, aims to formulate comprehensive standards for executing specific regulations and circulars.
Analysis: SEBI’s proactive step in proposing the Industry Standards Forum signifies its dedication to promoting a favorable environment for capital formation and business operations. The forum’s foundation in collaboration with industry associations speaks to the collective effort required to streamline regulatory adherence and compliance. Under the purview of stock exchanges, the forum seeks to gather industry insights and stakeholder feedback to design pragmatic standards that resonate with industry dynamics.
The positive reception of this concept underscores its potential to revolutionize regulatory implementation. Industry associations, including ASSOCHAM, CII, and FICCI, have embraced the initiative and identified priority areas for initial implementation. From rumor verification requirements to disclosure mandates under LODR Regulations and ESG assurance requirements, the spectrum of focus areas reflects the diverse challenges in compliance.
The timeline set by these associations to develop implementation standards demonstrates a tangible commitment to prompt action. The forthcoming standards, envisaged to be meticulously detailed, will serve as benchmarks for adhering to stipulated regulations and circulars. This not only fosters greater transparency but also reinforces investor confidence by ensuring regulatory integrity.
Conclusion: SEBI’s vision of an Industry Standards Forum underscores its dedication to fostering a business ecosystem marked by both innovation and compliance. By collaborating with industry associations, SEBI is poised to bridge the gap between regulatory requirements and practical implementation. As this initiative gains momentum and the standards take shape, the financial landscape stands to benefit from enhanced transparency, investor trust, and harmonized regulatory practices. The convergence of industry expertise and regulatory insight within this forum is poised to shape a more resilient and efficient financial market.
Securities and Exchange Board of India
Industry Standards Forum to facilitate ease of implementation of regulations: Industry Associations take next steps
In line with its commitment to facilitate capital formation in the economy and ease of doing business, SEBI, in July 2023, proposed the formation of an Industry Standards Forum, to be formed by Industry Associations and chaired by an Industry leader under the aegis of the Stock Exchanges. It was proposed that the Forum would formulate standards for implementation of specific regulations and circulars, based on feedback from industry and stakeholders, in consultation with SEBI.
The above mentioned concept and the proposal to start with a pilot has received very positive feedback. The Industry associations have conveyed that they would like to take up more than one pilot and the following, inter alia, have emerged as priority areas to start with:
1. Rumour Verification requirements
2. Disclosure requirements under Regulations 30 and 30A of LODR Regulations
3. BRSR Core / ESG assurance requirements
4. Structured Digital Database requirements under PIT Regulations
Associations have indicated a timeline of three to four months to design the standards for effective implementation of requirements in above areas. The standards would be designed at a level of detail to demonstrate compliance with the said regulations and circulars.
The three industry associations, ASSOCHAM, CII and FICCI have nominated their representatives for the pilots and agreed on the broad architecture of the Forum and are in the process of selecting a Chairperson for the same.
August 07, 2023