Bolstering efforts to curb white collar frauds, the corporate affairs ministry and markets watchdog Securities and Exchange Board of India will start automatic sharing of data between them.
The move also comes against the backdrop of concerns over corporate governance practices amid instances of misdoings and financial irregularities.
The ministry and SEBI on Friday entered into a formal memorandum of understanding for data exchange. The pact will facilitate the sharing of data and information between SEBI and the ministry on an automatic and regular basis.
"It will enable sharing of specific information such as details of suspended companies, delisted companies, shareholding pattern from SEBI and financial statements filed with the Registrar by corporates, returns of allotment of shares, audit reports relating to corporates," an official release said.
Both the sides, on request, will share any information available in their respective databases for the purpose of carrying out scrutiny, inspection, investigation and prosecution.
A Data Exchange Steering Group also has been constituted for the initiative, which would meet periodically to review the data exchange status and take steps to further improve the effectiveness of the data sharing mechanism, the release said. "MoU comes in the wake of increasing need for surveillance in the context of corporate frauds affecting important sectors of the economy.”
"As the private sector plays an increasingly vital role in economic growth, the need for a robust corporate governance mechanism becomes the need of the hour," as per the release. The MoU was signed by KVR Murty, joint secretary in the ministry, and Madhabi Puri Buch, a whole time member at SEBI.
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