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He said that the Sebi will be a willing partner in such a re-invention.
Speaking at a function organised by Tamilnadu Investors Association (TIA), he said, "I would strongly recommend that there is some need to re-invent the role of the investor associations in Sebi's scheme of things."
"I would like to encourage TIA and others as well to look at their role in the larger perspective of what is the expectations from the shareholders in India and outside the country, he added.
There are around 18 investor associations recognised by Sebi.
Over a period of time, the role of investor association has been going down in the scheme of things for Sebi. The outcome from the investor meetings has been going down and Sebi has started consultations with the associations at the regional level to find out what are the issues and why the investor associations can't be more active.
Given the contributions which the associations were making in the past and the challenges the investors are facing in the market today, the role of creating awareness and education in the market calls for a much better co-operation and activity on the part of the investors' associations.
The investors globally are getting more active in the activities. For instance, in the Fortune 500 companies in the last three years, almost one fourth of the CEOs who have been removed, were removed because their nominations were rejected by the shareholders. The per centage of proposals of compensation and bonus which has been rejected globally in the larger companies would be even higher.
"The shareholders are asking questions that why a certain percentage is being recommended and what is the justification. People are taking the shareholders' meetings very seriously," he said, adding that changes are happening in India also and the media is also getting into it.
While the regulator has taken steps in this direction by making it mandatory for the institutional investors to cast their vote on the resolutions put forward by the company and publish the outcome in their website and enabled e-voting to support the investors, the interest of the large number of small investors has to be taken care by the investor associations.
The associations should seriously introspect on what better and greater rold they can play in the next 10-20 years in this.
"I would like to assure that in that re-invention of your role, you will find that Sebi is a very very willing partner. We will be very happy to work with you in this area. You will not find that Sebi is lacking in this endevour, in this partnership. I would like to assure you about that," he added.
Detailing various efforts taken by the market regulator to bring in more protection to the shareholders and making the processes easier, including the measures taken for corporate governance, bringing in a flow in the system while helping better price discovery of companies and bringing in new regulations for electronic Initial Public Offering (IPO) and the enforcement of regulations of minimum public shareholding, he said that these measures has been well recognised in India and outside the country.
"In October 2014, the World Bank came out with a report about ease of doing business. India's ranking in this is not good at all. However, there is one component in that report related to the shareholder protection. In that report, in the year 2012, our ranking used to be 49, in 2013 it went up to 34 and in 2014 report, our ranking has gone up to seven," he added.
The Sebi has passed orders against 250 companies in past two years and collected Rs 26??? crore related to the unauthorised money collection. The law has been amended in 2014, so that any collection of more than Rs 100 crore under the control of Sebi as the collective investment scheme.
Sebi used to have over 30,000 grievances at the beginning of 2013. It introduced computerised grievance redressal mechanism, and now the number of grievances has gone down to 5,000 and the satisfaction level of those who complained were also assessed. More than 50% of the complaints are now getting resolved in 30 days.
