Statutory Committees at Market Infrastructure Institutions (MIIs)
Summary
This circular mandates the establishment of specific statutory committees, including functional and oversight bodies, for Market Infrastructure Institutions to ensure effective governance. It prescribes detailed composition rules requiring a majority of Public Interest Directors and Independent External Professionals in these committees. The document further outlines quorum requirements, voting procedures, tenure limits for members, and restrictions on committee memberships. This section outlines specific conduct rules for IEPs and statutory committee members, including prohibitions on using sensitive information and adherence to codes of conduct. It grants SEBI the power to nominate members to committees and mandates MIIs to establish feedback mechanisms and confirm committee compositions within three months. The text also modifies terms of reference for the ROC, updates terminology from MCSGFC to MC, and sets the applicability date and implementation steps for Market Intermediary Institutions. This section defines the terms of reference for the Nomination and Remuneration Committee (NRC) regarding the selection, evaluation, and compensation of directors and Key Managerial Personn
Text
MIIs shall have the following statutory committees: Functional Committees (Member Committee, Nomination and Remuneration Committee), Oversight Committees (Standing Committee on Technology, Regulatory Oversight Committee, Risk Management Committee), and Investment Committee.
The composition of statutory committees includes Key Management Personnel, Non-Independent Directors, Independent External Professionals, and Public Interest Directors, with specific expertise requirements for chairs such as capital markets or technology.
In any statutory committee, the total number of Public Interest Directors shall not be less than the total number of other members put together; for SCOT, this excludes IEPs.
The Chairperson of each statutory committee at an MII shall be a Public Interest Director.
Voting on a resolution is valid only when the number of Public Interest Directors casting votes is not less than the total number of other members casting votes.
Invitees to the meetings of the Committees shall not have any voting rights.
The casting vote in the meetings of the statutory committees shall be with the Chairperson of the committee.
Functions or terms of reference of any statutory committee cannot be delegated, except operational activities of the Member Committee may be delegated to Internal Committees containing at least one non-KMP member from the MC.
MIIs shall lay down the policy for the procedure for conducting of meetings, frequency of meetings, timelines for placing of agenda papers, etc., of their statutory committees.
If activities are not covered under statutory committee TORs, the governing board is directly responsible; the board and committees must identify KMPs or employees to execute assigned responsibilities.
Over and above statutory committees, the requirement to have mandatory committees under relevant laws for listed companies shall apply mutatis mutandis to MIIs.
Public Interest Directors on the governing board shall not act simultaneously as a member on more than five statutory committees of the MII.
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Source: SecMarx — Statutory Committees at Market Infrastructure Institutions (MIIs). Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.