The Securities and Exchange Board of India (SEBI) is the regulator for the securities market in India, established in 1988 and given statutory powers in 1992 through the SEBI Act. SEBI has three main functions: quasi-legislative, quasi-judicial, and quasi-executive. Its objectives are to protect investors, promote securities market development, and regulate the securities market. Some of SEBI's roles include licensing brokers and dealers, stopping fraud, regulating mergers and acquisitions, auditing stock market performance, and educating investors. SEBI has achieved several milestones like facilitating dematerialization of shares and shortening the settlement cycle. Key ongoing challenges include enforcement, developing talent and market intelligence, and deep

1. THE ROLE OF SECURITIES AND
EXCHANGE BOARD OF INDIA(SEBI)

Presented By:
K. N. Rai
R.K.Arora
Ravinder Kumar
Sandeep Kumar
Vijaivergia

2. Introduction – Why SEBI?
Genesis of SEBI
 The SEBI is the regulator for the securities market in India. It
was established in the year 1988 and given statutory powers
on 12 April 1992 through the SEBI Act, 1992.
 SEBI has three functions rolled into one body:quasi-
legislative, quasi-judicial and quasi-executive
 SEBI has to be responsive to the needs of three groups,
which constitute the market: the issuers of securities, the
investors, the market intermediaries.
Objective
 To protect the interests of investors in securities.
 To promote the development of Securities Market.
 To regulate the securities market.
 For matters connected therewith or incidental thereto.

3. Salient roles of SEBI
 Power to make rules for controlling stock exchange
 To provide license to dealers and brokers
 To Stop fraud in Capital Market
 To Control the Merge, Acquisition and Takeover the
companies
 To audit the performance of stock market
 To make new rules on carry - forward transactions
 To create relationship with ICAI
 Introduction of derivative contracts on Volatility Index
 To Require report of Portfolio Management Activities
 To educate the investors

4. SEBI’s Achievement :
 Dematerialization of shares : postal delays, theft and forgery
 Faster settlement process : moving from a T+5 settlement cycle in
2001 to T+2
 Stronger and clearer regulations, orders : the quality of orders passed
by Sebi and the mechanism of drafting new regulations have
improved
 Fostering mutual fund industry: relaxing (KYC) norms for small
investers, and widening the distribution network in rural India by
roping in postal agents
 Foreign institutional investors : Sebi has been consistently pushing to
encourage holders of securities like PNs to enter the market as
registered FIIs.
Major Controversies:
Ulips Mutual Funds
Participatory notes Sahara
MCX-SX

5. SEBI Initiatives related to CG
Clause 49 and its strengthening
 In 2000 a new clause Equity Listing Agreement – i.e. Clause
49 was introduced on the basis of Kumar Mangalam Birla
Committee (1999) recommendation based on international
CG practices (like Cadbury Greenbury and Hampel
committee reports)
 Enron and WorldCom(2001) failed and SOX committee(USA
2002 ) for strengthening CG
 Naresh Chandra committee (2002) Narayan Moorthy
committee(2003) to further strengthen clause 49.
 Satyam scam in 2009
 Adi Godrej committee 2012 on CG
 SEBI circulated consultative paper on review of CG norms in
India to incorporate provisions in Indian Company Bill 2012
and other global developments (like OECD principle)
related to CG

6. Road Ahead……
Key Challenges:
 Enforcement processes
 Talent pool & market intelligence
 Deepening capital markets
 Corporate debt and securitization market
 Matching up to Global standards
Concerns of PM:
 Enhanced savings and investment rates –
GDS/GDP (23% 2001, 36% - 2008, 30% -
2012)
 Public saving is not channelizing in
financial market due to uncertainty on
returns rather it goes in Gold/real state
 Retail investors must have the incentive to
invest in financial assets such as securities
 By 2017 1 Trillion USD investment
proposed .50 % are to be done from
financial institutes
The government on
17/07/2013 approved
a proposal to amend
Sebi Act for
providing more
powers to the market
regulator to crack
down on ponzi
schemes. The
decision, which will
also give Sebi
powers to conduct
search and seizure
operations and
access call data
records

7. Thanks….