SEBI reviewing framework for disclosure of issue proceeds utilisation: Chairman

SEBI Chairman Tuhin Kanta Pandey recently stated that the market regulator is reviewing the framework for monitoring and disclosing the use of issue proceeds. This review aims to enhance timely disclosures and simplify the compliance process, according to Pandey, who addressed the Institute of Directors Annual Directors Conclave 2026.

He emphasized that transparency is not solely about the quantity of information disclosed by a company, but rather about whether the information aids investors in understanding what is crucial. Pandey clarified that a company's disclosure alone does not guarantee transparency. True transparency involves the quality, timeliness, and usefulness of information.

SEBI has been progressively strengthening its framework for disclosing material events and information, incorporating materiality thresholds and specified timelines to ensure consistency and punctuality in disclosures. Additionally, Pandey mentioned that SEBI intends to further clarify the framework concerning related-party transactions, aiming to make the requirements clear and practical for issuers while preserving essential safeguards for investors.

Regarding regulatory compliance, Pandey argued that good governance necessitates regulation to be proportionate and avoid unnecessary duplication. To achieve this, SEBI is proposing a framework to prevent multiple exchanges from imposing identical fines on entities trading on more than one exchange for the same issue. Pandey stressed that the goal is to improve regulation's efficiency while maintaining its purpose.

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