Sebi Plans Annual Information Memorandum for Listed Companies

New Delhi: To ensure greater transparency and easier regulatory oversight, Sebi plans to make it mandatory for listed companies to publish annual information memorandum on all the details about their businesses and statutory disclosures.

The Securities and Exchange Board of India (Sebi) has started work with regard to annual information memorandum for listed companies and it is going to be mandatory, chairman U K Sinha today said.

Noting that such an exercise would help in a variety of ways, Mr Sinha said, "One is that you will not be visited by undue litigations from the regulators".

"Secondly, if you are going to raise some funds, either debt or equity, you don't have to update this information again and again. That is another idea why we are doing this," he said.

The idea is that let this information rest in the system and if there are minor changes or adjustments to be made to the specific issue then that can be done, the Sebi chief said.

He was speaking at a conference organised by industry body CII.

On whether this memorandum requirement is going to be introduced through guidelines or by amending the corporate governance norms, Mr Sinha said it would be both.

"It (memorandum) will be a far reaching thing because today a corporation which has filed everything as per Sebi requirement can still be hauled up, that is a lacuna in our system," he said.

According to him, if an entity has filed some information under the takeover regulations as well as part of disclosure requirements, both are taken separately.

"So for an analyst, a shareholder, a stakeholder it becomes a problem and it also becomes a problem for corporations that are willing to comply," he added.

The capital market watchdog already has stringent corporate governance norms for listed entities, as part of efforts to ensure more transparency