Capital markets need greater governance norms to keep faith of investors: Ajay Tyagi 

Chairman, Securities and Exchange Board of India (SEBI), Ajay Tyagi on Tuesday expressed great hope and optimism for Indian capital markets in the New India envisioned by the Government. Speaking at the inaugural session of 15th CAPAM, the Annual Capital Market Conference organised in Mumbai by the FICCI, he said, "Indian securities markets exhibited positive trend during 2017-18 with increased resource mobilization through issue of equity as compared to the previous financial year. And the current year promises even more action.”

This success could be attributed to stable macro-economic fundamentals, political stability and the structural reforms that the present government has been endeavouring towards over the last couple of years. Backed by strong inflows and increased participation of retail investors, the Indian IPO market witnessed heightened activity in the previous year. "Governance is of utmost importance. As the market grows, we need greater governance norms to keep the faith and trust of investors," Mr. Tyagi said. He added in order to improve the corporate governance framework, several recommendations of the Committee chaired by Uday Kotak have been implemented, such as enhanced role of the Nomination & Remuneration Committee, separation of the roles of Chairman and CEO, enhanced focus on Independent Directors etc. It is believed that these measures would further strengthen governance, leading to increased investor confidence, some of the mainstays of SEBI. Market integrity and fair conduct are cornerstones of an efficient capital market.

It is extremely important to prevent fraudulent and unfair trade. Chairman Sebi also informed the gathering that a view on the Report on Fair Market Conduct, submitted by the Committee chaired by Dr. T K Viswanathan, is to be formulated shortly. Another key focus area is Cyber Security, which has gained huge significance in the last few years.

Taking cognizance of this challenge, the Regulator plans to expand the scope for cyber security initiatives for market infrastructure institutions so as to reduce the element of uncertainty in the market. Other important issues he flagged up were development of the corporate bond market, ease of doing business and deployment of data analytics and new generation technologies.