NSE scouts for new MD & CEO; though Limaye is eligible for 5-year extension

The country’s largest bourse, the National Stock Exchange (NSE), has invited applications for the post of managing director and chief executive officer (MD and CEO).

Current MD and CEO Vikram Limaye’s five-year tenure ends this July, and he is eligible for another five-year term. However, he will have to go through the appointment process anew. Consultancy firm Korn Ferry has been hired to oversee the process.

In 2017, the Securities and Exchange Board of India (Sebi) revamped the rules pertaining to hiring of key personnel at market infrastructure institutions (MIIs) in the wake of the scandal at NSE.

Under the new rules, the head of an MII is allowed a maximum of two terms of five years each. The extension requires a thorough performance review and the approval of Sebi.

Industry players say top officials of leading MIIs and Sebi can apply for the job. They say Limaye’s good report card improve his chances of getting an extension, unless Sebi decides to get a fresh person.

Limaye took over when the exchange was going through a period of uncertainty following the resignation of former MD and CEO Chitra Ramkrishna amid allegations of wrongdoings at its co-location facility and of misgovernance over appointment of former group operating officer Anand Subramanian.

NSE’s key shareholders say Limaye has managed to steady the ship by improving the governance and technology standards. During his tenure, the exchange has been able to further cement its leadership position and reported strong financial performance.

The exchange has laid down specific requirements it is looking for in the candidates like experience of leading an organisation through an initial public offering (IPO).

Last year, NSE had sought a no-objection certificate from Sebi to proceed with its IPO and to file the draft red herring prospectus. The exchange’s listing plans have been delayed at least since 2016 due to allegations of lapses at its co-location facility. An order passed by Sebi against NSE last month highlighting lapses in governance and hiring process under Ramkrishna could delay the IPO further with central agencies, including the Central Bureau of Investigation,  stepping up their probe on the dealings at the exchange.

The NSE ad also says the candidate needs to have a track record of strengthening corporate governance, enterprise risk management and compliance management framework. It further says the candidate has to be result-oriented, persuasive and passionate communicator with highest ethical standards.

Last year, National Securities Depositories (NSDL) appointed Padmaja Chunduru as MD and CEO after her predecessor GV Nageswara Rao finished his second term. Rival BSE’s MD and CEO Ashish Chauhan’s second five-year tenure ends in November 2022.