Master Circular for Research Analysts

SEBI/HO/MIRSD-PoD-2/P/CIR/2023/90 · 2023-06-15 · SEBI

Summary

This part of the document serves as a Master Circular compiling existing SEBI circulars for Research Analysts and rescinding previous individual circulars. It establishes transitional provisions ensuring that actions taken under rescinded circulars remain valid and unaffected by the new compilation. The section concludes with procedural guidelines for Proxy Advisors regarding voting policies, error correction timelines, and conflict of interest disclosures. This section outlines grievance resolution mechanisms for listed entities against proxy advisors and establishes procedures for investor redressal through the SCORES platform. It mandates research analysts to display specific contact information, publish an Investor Charter, and disclose monthly complaint statistics on their digital platforms. Additionally, it provides advisory guidelines on cybersecurity for SaaS solutions and details the procedural requirements for obtaining SEBI approval regarding changes in control. This section mandates specific declarations and approvals for intermediaries seeking change in control, including board stability and fit-and-proper criteria. It outlines a streamlined process for NCLT-sanctioned

Text

In order to enable users to have access to the applicable circulars at one place, this Master Circular in respect of RAs is being issued.

The Master Circular is a compilation of all the existing/ applicable circulars issued by SEBI pertaining to Research Analysts.

From the date of issuance of this Master Circular, the circulars mentioned in Appendix stand rescinded, to the extent applicable to Research Analysts.

Anything done or any action taken or purported to have been done or taken under the rescinded circulars, prior to such rescission, shall be deemed to have been done or taken under the corresponding provisions of this Master Circular;

Any application made to the Board under the rescinded circulars, prior to such rescission, and pending before it shall be deemed to have been made under the corresponding provisions of this Master Circular;

The previous operation of the rescinded circulars or anything duly done or suffered thereunder, any right, privilege, obligation or liability acquired, accrued or incurred under the rescinded circulars... shall remain unaffected as if the rescinded circulars have never been rescinded.

This circular is issued in exercise of powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992 to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.

Proxy Advisors shall formulate the voting recommendation policies and disclose the updated voting recommendation policies to its clients. Proxy Advisors shall ensure that the policies should be reviewed at least once annually.

Proxy Advisors shall disclose the methodologies and processes followed in the development of their research and corresponding recommendations to its clients.

Proxy Advisors shall alert clients, within 24 hours of receipt of information, about any factual errors and any impending material revisions to their reports.

Proxy Advisors shall have a stated process to communicate with its clients and the company.

Proxy Advisors shall share their report with its clients and the company at the same time. This sharing policy should be disclosed by proxy advisors on their website.

Source: SecMarx — Master Circular for Research Analysts. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.