INSUBCONTINENT EXCLUSIVE:
Market regulator Securities and Exchange Board of India (Sebi) is planning to revamp the regulations for proxy advisory firms
The expert panel appointed by Sebi to look into the matter met last week to identify the aspects where the regulations need to be
tweaked.
Protecting proxy firms from frivolous litigation and increasing the accountability of the foreignbased proxy advisors will be the
key focus for the expert panel, said two people privy to the development
The committee headed by Sandeep Parekh, founder, Finsec Law Advisors, will submit its final report by January-end.
The development assumes
significance as proxy advisory firms do not have separate regulations despite their growing prominence
against proxy firm Institutional Investors Advisory Services (IIAS), for allegedly making defamatory comments against one of its directors
proxy firms is another key challenge under the current regulations
While all the domestic proxy firms are registered with Sebi, the same is not compulsory for the foreign players
vote against an extension to Deepak Parekh as non-executive director on the board
The view taken by these two proxy advisories prompted nearly a fourth of the public institutions vote against the proposal.
Market
participants did not react kindly to the voting call given by the two proxy firms
Keki Mistry, vice chairman and chief executive officer of HDFC, had said in a media interaction that some of the foreign funds, especially
Kotak Mahindra Bank, also criticised the foreign proxy advisories and said these firms providing services in India should be regulated in
the same way as their domestic counterparts
