Home / Business and Economy / SEBI Probes MII Governance: Variable Pay & Payout Freezes Eyed
SEBI Probes MII Governance: Variable Pay & Payout Freezes Eyed
18 Jan
Summary
- SEBI is reviewing variable pay for senior executives at market infrastructure institutions.
- New standard operating procedures are proposed for withholding securities and funds.
- Legal opinion is sought before implementing significant governance changes.
The Securities and Exchange Board of India (SEBI) is consulting its Legal Affairs Department on proposed regulatory changes for market infrastructure institutions (MIIs). These proposals focus on enhancing governance and operational clarity, with a legal review currently underway.
One key proposal involves modifying the variable pay structure for senior management at MIIs like stock exchanges. The aim is to allow payouts below the current 25% minimum during periods of underperformance, providing SEBI with more flexibility to link incentives to individual and institutional results.
Additionally, SEBI is developing a standardized operating procedure for withholding securities and funds. This initiative seeks to create a clear, legally sound framework for MIIs to act swiftly on court or law enforcement orders, ensuring operational certainty and preventing ambiguity.
