The Securities and Exchange Board of India (Sebi) is likely to come out with detailed guidelines on disclosure requirements for listed companies after several companies were found flouting rules on continuous listing requirements. "Today there are about 1,100 listed companies which are non-compliant with the requirement of clause 35 of the listing agreement. This means they have not filed their shareholding pattern in compliance with the Sebi rules," Sebi chairman UK Sinha told a conferecne arranged by the Federation of Indian Chambers of Commerce and Industry on Friday.
"We are trying to see that there is no longer any scope for any corporate to get away with it. We are not talking about the numbers but the quality of filings. So, in this regard we have now decided to come out with detailed guidelines on the quality and the adequacy of disclosures," Sinha said. He added that stock exchanges will have to hire more people to monitor compliance by listed companies.
The regulator will come out with the new norms tightening the disclosure requirements on Monday. Sinha also said that the regulator has written to its counterpart in the insurance sector to encourage insurance companies to responsibly cast their votes on corporate resolutions.
The market regulator is of the view that insurance firms along with asset management companies could collectively play an active role in protecting the interests of small investors. Sebi has urged the insurance regulator to come up with norms on improving corporate governance in listed companies similar to new rules governing the voting record of mutual funds. Insurance companies are dominant shareholders among domestic institutional investors in several top listed firms.
The Sebi chief said he was concerned about companies' failure to comply with corporate governance norms. "There are 900 companies which are not compliant with the requirements of corporate governance norms...a detailed regulations on corporate governance is coming very soon," Sinha said.
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