Shaping A Transparent Future: SEBI's Regulatory Reforms And Industry Mandates (Dec 2024 – Apr 2025)

In an ongoing effort to enhance transparency, accountability and investor protection in the Indian securities market, the Securities and Exchange Board of India ("SEBI") has introduced a series of regulatory amendments and industry mandates in the last quarter. These updates encompass various regulations, including the SEBI (Prohibition of Insider Trading) Regulations, SEBI (Listing Obligations and Disclosure Requirements) Regulations, along with the introduction of new Industry Standards, between December, 2024 to April, 2025. The aim is to strengthen corporate governance norms, streamline disclosure requirements, encourage ESG transparency, and leverage technology for regulatory compliance.

1. Amendments to SEBI (Prohibition of Insider Trading) Regulations, 2015

SEBI notified the SEBI (Prohibition of Insider Trading) (Third Amendment) Regulations, 2024, w.e.f December 5, 2024. The term 'immediate relatives' has been substituted with 'relatives', thereby expanding the definition of "connected persons" to include spouse of the person, parent of the person and parent of their spouse, sibling of the person and sibling of their spouse, child of the person and child of their spouse, spouse of the sibling (both person and their spouse), spouse of the child (both person and their spouse). The definition has also been expanded to include individuals who share a household or residence with a connected person and partners/employees of firms in which a connected person is a partner.

Any individual with access to Unpublished Price Sensitive Information ("UPSI") is now considered an insider, irrespective of how such information was obtained. The burden of proof now lies on the accused in insider trading cases to demonstrate that they did not possess UPSI or that their trades fall under exempted categories.

SEBI further notified the SEBI (Prohibition of Insider Trading) (Amendment) Regulations, 2025, w.e.f June 9, 2025, thereby expanding the definition of UPSI to include new event disclosure requirements such as, award/termination of significant contracts not in normal course of business, changes in KMP other than due to superannuation or end of term and resignation of statutory / secretarial auditors, changes in ratings (excluding ESG), planned fund-raising, agreements affecting management/control, Fraud / defaults / arrests of promoter /director / KMPs, loan resolution plans, winding-up petitions / CIRP applications, forensic audits, regulatory or judicial actions, litigation outcomes, non-routine guarantees / indemnities, key license / regulatory approval changes. The Amendment Regulations now require that any information not emanating from within the organization to be entered into the Structured Digital Database ("SDD") within two calendar days from the date of receipt and have relaxed the trading window closure requirement for UPSI originating from outside the listed entity.

2. Compliance with Various Industry Standards

SEBI has mandated compliance with industry standards on Reporting of BRSR Core, Regulation 30 of SEBI (LODR) Regulations (for effective implementation of the requirement to disclose material events or information u/r 30 of SEBI (LODR) Regulations, 2015) and Minimum information for Approval of Related Party Transactions (to assess the materiality of the transaction to be approved by the audit committee and shareholders, as the case may be).

3. SEBI (LODR) (Third Amendment) Regulations, 2024

Effective December 12, 2024, the amendment to SEBI (LODR) Regulations, 2015 requires:

1. Key Managerial Personnel ("KMP"), directors, promoter, promoter group, or any other person dealing with the listed entity to disclose all relevant and necessary information to the listed entity to ensure compliance with applicable laws;
2. Compliance Officer to be designated as a KMP and be an officer in whole-time employment of the listed entity, not more than one level below the board of directors;
3. Listed company to:
   1. file quarterly statements with the recognised stock exchange(s) detailing the redressal of investor grievances within 30 days instead of 21 days earlier;
   2. submit, to the recognised stock exchange(s), a quarterly compliance report on corporate governance within 30 days SEBI, instead of 21 days stipulated earlier;
   3. publish an advertisement in the newspaper, within forty-eight hours of conclusion of the meeting of board of directors at which the financial results were approved, containing a Quick Response code and the details of the webpage where complete financial results of the listed entity, along-with the modified opinion or reservation(s), if any, expressed by the auditor;
   4. make available the video recordings of post earnings or quarterly calls on the website within forty-eight hours from the conclusion of such calls; and the transcripts of such calls on the website along with simultaneous submission to recognized stock exchanges within five working days of the conclusion of such calls.

4. The requirement to submit compliance certificate to the stock exchange(s) pertaining to the maintenance of share-transfer facility (in-house or by registrar) has been done away with.

4. Clarification on Regulation 42, SEBI (LODR) Regulation, 2015

Effective from December 12, 2024, NSE and BSE have clarified that listed entities must ensure a minimum three-working-day gap between board/shareholder's approval and the record date for corporate actions. The requirement to announce transfer book closure dates has been removed.

5. Extension of Single Filing System through API-Based Integration for Integrated Filing (Governance)

Effective from March 1, 2025, NSE and BSE have extended the single filing system for Integrated Filing (Governance). This system now covers various reports and filings, streamlining the process for listed entities.

6.Modification of Format for Disclosure of Holding of Specified Securities and Shareholding Pattern

Effective from the quarter ending June 30, 2025, SEBI has revised the disclosure requirements for holding of specified securities and shareholding pattern. The amendments include:

1. details of Non-Disclosure Undertaking, Other encumbrances, if any and total number of shares pledged or otherwise encumbered including NDU to be disclosed by the listed entities; ESOPs as part of underlying outstanding convertible securities;
2. details of total number of shares on fully diluted basis (including warrants, ESOP, Convertible Securities etc.

Further, a footnote for promoter and promoter group with "nil" shareholding has been added.

7. SEBI (LODR) (Amendment) Regulations, 2025

The Amendment Regulations w.e.f March 27, 2025, have introduced a new chapter VA for new corporate governance norms for entities with only NCDs listed, having an outstanding value of ₹1,000 crore or more (High Value Debt Listed Entity) and no listed specified securities. Further, in Reg. 3 (2) (b) of the principal regulations, the amendment regulations specify that the word "assurance" in the proviso should be replaced with "assessment or assurance of the specified parameters.

8. Revision of ESG Disclosure Framework for Value Chain

SEBI has revised various provisions pertaining to ESG disclosures w.e.f March 28, 2025, allowing listed entities the option to undertake "assessment" or "assurance" for BRSR (Business Responsibility and Sustainability Reporting) Core and ESG disclosures, introducing an additional leadership indicator seeking disclosures on green credits, applicable from FY 2024-25 onwards. For the disclosures for value chain to be made by the listed company as per BRSR Core, as part of its Annual Report, the value chain shall now encompass the top upstream and downstream partners of a listed entity, individually comprising 2% or more of the listed entity's purchases and sales (by value) respectively. However, the listed entity may limit disclosure of value chain to cover 75% of its purchases and sales (by value) respectively. SEBI has:

1. deferred the disclosure and assessment or assurance for the value chain by one year, making ESG disclosures for the value chain voluntary for the top 250 listed entities from FY 2025-26, with assessment or assurance becoming voluntary from FY 2026-27.
2. required the top 150, 250, 500 and 1000 listed entities by market capitalization to undertake "assessment" or "assurance" of the BRSR Core as under:
   1. FY 2023-24 - Top 150 listed entities;
   2. FY 2024-25 - Top 250 listed entities
   3. FY 2025-26 - Top 500 listed entities;
   4. FY 2026-27 - Top 1000 listed entities;
3. made ESG disclosures for value chain of previous year numbers voluntary for the first year of reporting. Also, if a listed entity provides ESG disclosures for value chain, then it shall disclose the percentage of total sales and purchases covered by the value chain partners, respectively, for which ESG disclosure are provided.

9. Clarification on the Position of Compliance Officer

Effective from April 1, 2025, SEBI has clarified the position of the compliance officer in terms of Regulation 6 of the SEBI (LODR) Regulations, 2015. The term "level" has been clarified to refer to position of the Compliance Officer in the organization structure of the listed entity. "One-level below the Board of Directors" means one-level below the Managing Director ("MD") or Whole-time Director(s) ("WTD") who are part of the Board of Directors of the listed entity in line with definition of "KMP" as per LODR Regulations and Companies Act, 2013. If the Company does not have a MD or WTD, then Compliance officer must be at most one level below the CEO, or Manager or the person handling day-to-day affairs of the company.

10. NSE & BSE Mandate XBRL Utility for Integrated Financial Filings

Effective from April 1, 2025, NSE and BSE have mandated the use of XBRL format for Integrated Filing-Financial. This includes governance and financial results filings,

streamlining the submission process for listed entities.

The outcome of the Board Meeting in PDF mode for financial results needs to be submitted within the timelines of 30 minutes or 3 hours, as applicable. The listed entities are required to submit Integrated Filing-Financial in XBRL on the same date of submission of the financial results (in PDF form), on the paths mentioned in circular. Further, the following have been discontinued w.e.f. April 01, 2025: PDF filing of 'Integrated Filing - Financial' in the Corporate Announcement under the existing path, Existing XBRL utilities for filing Financial Results, Related Party Transactions Disclosure, and Statement of Deviations, Impact of Audit Qualifications; Submission of Statement of Deviation(s) / variation(s) in PDF format.

11. SEBI (LODR) Regulations, 2015) (Second Amendment) Regulations, 2025

The Amendment Regulations w.e.f April 29, 2025, stipulate that the SCORES registration for securitized debt instruments can be taken at the trustee level for all special purpose distinct entities they oversee. Further, new clauses have been added under Part D of Schedule III of the principal regulations (which pertains to disclosure of information having bearing on performance/operation of listed entity and/or price sensitive information) requiring disclosure of:

1. outstanding litigations and material developments related to the originator, servicer, or any other party to the transaction that could affect investors' interests, to be disclosed annually by the special purpose distinct entity or its trustee to the stock exchange;
2. defaults in servicing obligations by the servicer, to be disclosed annually by the special purpose distinct entity or its trustee to the stock exchange.

12/ SEBI extends automated implementation of trading window closure to immediate relatives of Designated Persons ("DPs")

On April 21, 2025, SEBI issued a circular mandating the extension of the automated enforcement of trading window closures to include the immediate relatives of Designated Persons ("DPs"), specifically in relation to the announcement of financial results. The framework for freezing the PAN of DPs at the security level has now been extended to the immediate relatives of the DPs. The procedure for implementation of the system and a flowchart for the same are enclosed in Annexure A and Annexure B of the Circular. The process for implementation includes companies accessing the Designated Depository ("DD") portal to manage the trading window closure details. Details of DPs and their immediate relatives, including PAN and demat account information, must be confirmed and updated as necessary. The trading window closure period must be specified, and details provided to the DD at least two trading days before the closure. This framework will be implemented in a phased manner as follows: Phase 1 involves the top 500 companies based on BSE market capitalization as of March 31, 2025, listed on BSE, NSE, and MSEI, which must implement the PAN-ISIN freeze starting July 01, 2025. Phase 2 includes all remaining listed companies on BSE, NSE, and MSEI, and companies that get listed after the issuance of this circular, which must implement the freeze starting October 01, 2025.

Implications on Listed Entities

The updates and amendments introduced by SEBI have significant implications for listed entities. The expanded definition of "connected person" and new categories of insiders increase the scope of individuals subject to insider trading regulations. The new event disclosure requirements and relaxed trading window closure rules enhance transparency and compliance. This broadens the scope of UPSI to cover additional material events and imposes stricter SDD requirements, enhancing transparency while easing trading window norms for externally sourced information.

The mandatory compliance with industry standards ensures uniformity in reporting and disclosure practices. The amendments to SEBI (LODR) Regulations introduce stricter disclosure requirements and enhance corporate governance norms. The clarification on the position of the compliance officer ensures that the role is adequately positioned within the organization.

The extension of the single filing system and the mandate for XBRL utility streamline the filing process, reducing the administrative burden on listed entities. Overall, these updates aim to enhance transparency, accountability, and compliance among listed entities, thereby fostering a more robust regulatory environment.

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