Governance as a Strategic Imperative: SEBI Chair Emphasizes Market Integrity

In a strong push for ethical market conduct and institutional accountability, SEBI Chairman Tuhin Kanta Pandey underscored the strategic role of corporate governance in ensuring market stability and financial integrity. Speaking at the Confederation of Indian Industry (CII) Corporate Governance Summit held in Mumbai on April 17, Pandey remarked that governance is not merely a matter of oversight but a core pillar for preserving trust in capital markets.

He warned that governance failures in large corporations can lead to systemic disruptions, affecting not only investors but also the broader economic ecosystem. “By mandating disclosures, board structures and oversight mechanisms, we aim to create a self-regulating environment that encourages ethical and responsible corporate behaviour,” Pandey stated. His remarks reflect the regulator’s continued emphasis on preemptive risk identification and deterrence through structural reforms and enhanced transparency.

Highlights:

Governance failures in large firms can ripple through the economy.
SEBI aims for a self-regulating corporate environment.
Emphasis on board accountability and disclosure compliance.
Governance seen as central to long-term institutional trust.

Push for Rationalised, Relevant Regulations Amid Business Ecosystem Evolution

Acknowledging the delicate balance between fostering ease of doing business and maintaining regulatory oversight, the SEBI chief asserted the need for “optimum regulation.” He acknowledged that while excessive regulation can stifle innovation and business growth, insufficient regulation may erode stakeholder trust and harm market performance.

“To promote sustainable growth, regulations need to be rationalised by removing outdated provisions and reducing redundancies,” Pandey noted. He called for a dynamic and responsive regulatory framework that evolves with market needs without compromising integrity. His comments arrive at a time when Indian capital markets are navigating a complex global economic environment, necessitating both agility and discipline.

Highlights:

SEBI recognizes risk of over-regulation dampening growth.
Insufficient oversight poses trust and compliance challenges.
Emphasis on periodic regulatory pruning and harmonization.
Goal is to support innovation while safeguarding investor interests.

Strengthening Transparency and Accountability Through Technology and Disclosures

SEBI has taken significant steps in recent years to enhance transparency in India’s listed corporate sector. Pandey highlighted that disclosures such as quarterly shareholding patterns, financial results, and deviations in fund utilization are essential tools for investor protection and market symmetry.

He encouraged the adoption of reg-tech (regulatory technology) solutions within boardrooms to streamline compliance processes, enhance reporting accuracy, and boost operational efficiency. “SEBI and exchanges are deploying suit-tech solutions for effective supervision. Technology has helped detect early signs of market abuse and non-compliance,” Pandey said, signalling SEBI’s readiness to integrate technological innovation into regulatory enforcement.

Highlights:

SEBI mandates disclosures to enforce information symmetry.
Reg-tech urged for corporate compliance and governance transformation.
Exchanges and regulators already using tech for market surveillance.
Technology helps uncover early signs of misconduct and inefficiency.

Call for Industry-Led Cultural Shift in Corporate Governance

While outlining SEBI’s regulatory roadmap, Pandey made it clear that long-term change must stem from internal corporate initiatives. “True and lasting change must come from within the corporate boardrooms,” he said, advocating for a cultural and ethical shift in how companies view governance.

Pandey urged firms to build institutions that transcend short-term gains and embody sustainable practices. “Governance is not about ticking boxes. It is about building institutions that can be trusted for years and decades,” he concluded. His call highlights the evolving role of SEBI—from a rule-setting body to a catalyst for long-term institutional credibility and sustainable market architecture.