INDUSTRY
SEBI tightens disclosure norms for top brass to plug conflict of interest issue
- IBJ Bureau
- Mar 24, 2026
The board of markets regulator SEBI has approved a wide-ranging proposal, including easing fund settlement norms for foreign portfolio investors (FPIs) and changes to regulatory frameworks for market intermediaries.
Additionally, the board has approved several recommendations of the high-level committee on conflict of interest and disclosures concerning the SEBI executives.
Under the new conflict-of-interest norms, the SEBI’s chairman, whole-time members, executive directors and chief general managers must disclose comprehensive, annual, transaction-based details on assets, liabilities and familial relationships.
The SEBI chairman and whole-time members must now liquidate or freeze all existing equity and equity-related investments upon joining office.
The mandatory disclosures extend to spouses and dependent family members of the top executives.
New investments in regulated financial products are capped at 25 per cent of a SEBI executive’s total financial portfolio for any single intermediary.
Besides, the board has approved a transition from a gross to a net settlement mechanism for foreign portfolio investments (FPIs) in the cash market, with a full implementation deadline of December 31, 2026.
Accordingly, FPIs can now offset buy and sell trades within the same settlement cycle, paying or receiving only the net difference.
This change is designed to lower funding costs and minimise foreign exchange slippage, particularly during high-volume events, like index rebalancing.
While the fund settlement is netted, the settlement of underlying securities will continue on a gross basis.
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