3, December, 2023
HomeBusinessSebi's Evolving Approach: More Consultation, Less Regulation Drive

Sebi’s Evolving Approach: More Consultation, Less Regulation Drive

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In a recent statement, Madhabi Puri Buch, the Chairperson of the Securities and Exchange Board of India (Sebi), clarified that Sebi is not on a hyperdrive to impose more regulations on the market. Instead, the regulator has adopted a more consultative approach, driven by the evolving complexity of the market.

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Speaking at FICCI’s Capital Market Conference, Buch highlighted the deep-seated belief at Sebi that thorough consultation is essential in understanding diverse perspectives before implementing regulatory changes. Contrary to the perception of a regulatory “hyperdrive,” she emphasized that the increased issuances of consultation papers reflect a positive change in Sebi’s regulatory attitude.

Buch shared data illustrating the shift in Sebi’s approach over the years. Between 2003 and 2013, consultation papers accounted for 7 percent of total circulars issued by Sebi. Over the next nine years, this percentage increased to 17 percent, indicating a growing recognition of the market’s complexity.

In the past year, the percentage of consultation papers has risen to 33 percent, meaning that one in every three Sebi circulars is now a consultation paper. Buch clarified that this shift does not imply an imposition of more regulations but rather signifies Sebi’s commitment to consulting stakeholders to make informed decisions.

Acknowledging feedback that Sebi was perceived to be issuing consultation papers at a rapid pace, Buch assured that Sebi’s consultative approach was taken seriously. She humorously remarked that if stakeholders prefer, Sebi could consider returning to a lower percentage of consultation papers, highlighting the regulator’s openness to feedback.

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This evolving approach by Sebi aligns with its commitment to navigating the complexities of the market effectively, ensuring that regulatory decisions are well-informed and inclusive of diverse perspectives.

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