- Securities and Exchange Board of India vide circular dated May 26, 2025, has provided process for appointment, re-appointment, termination or acceptance of resignation of specific Key Management Personnel (KMPs) of a Market Infrastructure Institution (MII). These KMPs namely the Compliance Officer (CO), Chief Risk Officer (CRiO), Chief Technology Officer (CTO) and Chief Information Security Officer (CISO) are crucial for any MII to deliver on its core public interest mandate of giving primacy to compliance, risk management, technological resilience and market integrity, over commercial considerations.
- The process for appointment shall be as under:
- The MII shall engage an independent external agency to identify and recommend suitable candidates for appointment as CO, CRiO, CTO and CISO or by whatever designations called.
- The Agency shall submit its recommendations to the Nomination and Remuneration Committee (NRC) of the MII. The NRC will evaluate the recommendations of the agency and after discussion with the management of the MII, submit its recommendations for appointment of such KMPs to the Governing Board of the MII.
- The Governing Board shall take the final decision for appointment of such KMPs.
- For Re-appointment, Termination or acceptance of Resignation:
The process for reappointment, termination or acceptance of
resignation shall be as under:
- The NRC shall evaluate the cases of re-appointment, termination or acceptance of resignation of CO, CRiO, CTO and CISO or by whatever designations called and after discussion with the management of the MII, submit its recommendations to the Governing Board of the MII.
- The Governing Board shall take the final decision for re-appointment, termination or acceptance of resignation of such KMPs. Provided that no such KMPs shall be terminated unless he/she has been given a reasonable opportunity of being heard by the Governing Board.
- The provisions of the circular shall be applicable from the 90thdayof issuance of the circular.
- The circular is attached herein.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
