Sebi wants discontinuation of RBI representation on its board

Sebi wants the government to discontinue the practice of its board having a nominee from the Reserve Bank of India, or alternatively provide for a cross-representation of the two regulators on each other’s boards.

Sebi first proposed to the Ministry of Finance to discontinue RBI’s representation on its board, as it already has adequate presence of the government nominees. Besides, the boards of other regulators such as IRDAI for insurance sector and PFRFA for pension sector do not have nominees from other regulators, while there is no corresponding representation of other regulators on the RBI’s board, Sebi has contended. However, the Finance Ministry opined that the role of the RBI in the financial sector cannot be discounted and that the RBI presence helps in bringing “overall economic view and valuable inputs to the Sebi board”.