The Securities and Exchange Board of India's responsibility is not to allow commercial interest being placed above those of the public, said the regulator's Chairman Tuhin Kanta Pandey, when asked about the IPO of National Stock Exchange on the sidelines of an event on Thursday.
Pandey's comments come at a time when the regulator is reviewing the NSE's application to go public.
Pandey, while speaking at Confederation of Indian Industries' 18th Corporate Governance Summit held in Mumbai, also talked about optimum regulation and asks corporates to aim for self-regulation.
“We need to strike a balance between regulation and ease of business. Excessive regulation can stifle innovation, while too little can erode trust, the SEBI chief said. He stressed on the importance of optimal regulation, focusing on what's essential and removing the non-material.
Mentioning the regulator's moves to ease functionality for the corporates, Pandey stated that SEBI has introduced a single filing system and reduced paperwork requirements. Companies now have the option to skip detailed newspaper advertisements of financial results and can instead rely on digital databases. Disclosure timelines for board meeting outcomes and litigation updates have also been extended to improve efficiency.
Talking about the consequences of governance failures at big corporations, he said that "governance failures in large corporates can have ripple effects across the markets and the broader economy. Preventing such failures is essential to maintaining financial stability."
"Mandating disclosures, robust board structures, and oversight mechanisms aim to create a self-regulating environment that encourages ethical and responsible corporate behavior. SEBI has been instrumental in strengthening corporate governance among listed companies," he added.
Calling for the boards to be more proactive, the SEBI chairperson said that the "boards must rise above routine matters and ask difficult questions. Auditors and independent directors must act with the seriousness and integrity expected of them."
SEBI's regulations are not just rule-based—they are grounded in principles that reflect the essence of what is expected from corporate governance, he said.
"There is a strong emphasis on doing the right thing for the right reasons, asking the right questions, constructively challenging management, demonstrating sound judgment, maintaining an independent perspective, and avoiding groupthink," he further added.
Finally, Pandey said that corporate governance is not merely a regulatory requirement—it is a matter of conscience and that SEBI will continue to raise the bar on governance, but true and lasting change must come from within corporate boardrooms and organisational cultures.
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