Members, kin must disclose portfolio: Sebi code

The Securities and Exchange Board of India (Sebi) has come out with a code of conduct for its members of the governing board.

The code is aimed at “avoiding conflict of interest and ensuring that members conduct their duties in a manner that does not compromise on their ability to accomplish the regulator’s mandate”. The code was adopted by the board in its last meeting held on December 4. Sebi has made the code applicable to all members, including its Chairman.

The code includes provisions such as disclosing holdings of shares by members and their families, non-acceptance of gifts from intermediaries and avoiding conflict of interests that can affect decisions of the board.

Sebi has also said that “no member shall hear or decide on any matter where he has a conflict of interest”.

Sebi Chairman C B Bhave has followed certain high moral standards after taking charge. Prior to becoming Sebi chief, Bhave was the Managing Director of NSDL against which the market regulator had issued an order in the 2006 IPO scam. To avoid conflict of interest, Bhave stayed away from board meetings where the NSDL issue was to be discussed.

The code also outlines what members should do while dealing with intermediaries in their personal capacities. It requires them to disclose their professional relationship with market intermediaries in the past five years. Whole-time members are barred from holding any office of profit.