Markets regulator SEBI is considering capping the tenure of stock exchange CEOs to a maximum of two terms of five years each, as part of an overhaul of regulations for ownership and governance norms for market infrastructure institutions.
Besides, the watchdog is planning to bring in new ownership norms for setting up of stock exchanges as it feels that the entry of new players can benefit investors with better product choices and effective cost structures, a senior official said.
At its next board meeting scheduled for June 21, SEBI will propose coming out with a consultation paper for various regulatory and procedural requirements for setting up of Market Infrastructure Intermediaries (MIIs), including stock exchanges.
SEBI is also looking to harmonise the shareholding limit across stock exchanges, clearing corporations and depositories, according to a senior official.
The official said it is proposed that entities that presently hold more than a 15 per cent shareholding in the depository as a sponsor might be allowed to reduce their stake to 15 per cent over five years or a specified period.
Further, it is proposed to expand the definition of key managerial personnel at these institutions, whereby a person up to two levels below MD/ CEO would be deemed a key managerial personnel.