Need to separate individual from institution: FM Nirmala Sitharaman

Finance Minister (FM) Nirmala Sitharaman on Monday said one should not take pleasure in bringing down institutions and instead come out in their support during difficult times.

“There are very few institutions of national stature left. Let us not take pleasure in bringing them down. If such an institution is going through a difficult time, we should support it. One needs to separate the individual and the institution. Individuals will come and go, but institutions survive for many years,” she reportedly said, while addressing top executives from the capital markets industry.

Business Standard wasn’t part of the meeting. However, three executives, who attended the meeting, confirmed the comments made by the FM at a close-door convention.

Those who attended the meeting said she could be referring to institutions such as the National Stock Exchange (NSE) and markets regulator Securities and Exchange Board of India (Sebi).

Sitharaman is in the country’s financial capital on a two-day post-Union Budget customary visit. At one meeting, the FM addressed chief executive officers (CEOs) of the broking, stock exchange, and mutual fund industry.

She talked about ways to deepen capital markets, improve infrastructure funding and the ease of doing business.

The NSE has come under criticism over the controversy surrounding the exchange’s former boss Chitra Ramkrishna sharing confidential information with an outsider (purported spiritual guru) and lapses in human resource practices. An order passed by Sebi on February 11 revealed Ramkrishna ran India’s largest exchange as a ‘puppet master’ and shared information on board agenda and business plans with a ‘Himalayan yogi’.

The NSE and Ramkrishna have also been pulled up by Sebi over the appointment and compensation package of Anand Subramanian, the exchange’s former group operating officer. Without relevant experience, Subramanian was made second-in-command and given ‘arbitrary and disproportionate increase in compensation’. 

The controversy, although has come to light now, dates back to the period between 2013 and 2016. Some have even criticised Sebi for acting late and letting Ramkrishna and Subramanian off the hook easily. Earlier this month, Sebi imposed a penalty of Rs 3 crore on Ramkrishna and Rs 2 crore each on the NSE, Subramanian, and another former managing director and CEO Ravi Narain.

The NSE in a statement has said the issue was over six years old and the exchange has taken corrective action, which includes revamping its board and management.