Compliance officers must pass test: Sebi

The Securities and Exchange Board of India (Sebi) will soon make it mandatory for compliance officers of all market participants to take a certification programme. The programme will be conducted by the National Institute of Securities Markets (NISM).

The Sebi move assumes significance in the light of the recent regulatory changes that have made compliance officers responsible for many activities. In one such action, Sebi made compliance officers responsible for unsubstantiated news or rumours related to a listed entity spread by an employee of a market intermediary.

“We are planning to introduce a separate certification exam for compliance officers,” said Sebi general manager V S Sundaresan. “The regulations would be rendered ineffective if the market intermediaries are not aware of it,” he added.

Sebi is also planning to introduce certification programmes aimed at various classes of intermediaries. The regulator is also focusing on the need for refresher courses to keep pace with product innovation.

“The certification has to be followed by CPE (continuing professional education). The aim is to improve the market quality,” said Sundaresan.

The NISM certification will be valid for three years, after which a person will either have to again take the module or appear for CPE to get the certification re-validated.