Securities and Exchange Board of India finalises an Industry Standards Recognition Manual to standardise how Industry Standards Fora operate

The Securities and Exchange Board of India (SEBI) has finalised and published an Industry Standards Recognition Manual setting out self-guiding principles for SEBI’s recognition of industry-developed implementation standards and for streamlining the constitution and processes of Industry Standards Fora (ISFs). SEBI launched ISFs as a pilot programme in July 2023 to formulate implementation standards for SEBI’s regulatory instructions, initially for listed companies and stock brokers and later extending similar fora on a pilot basis to other securities market stakeholders including portfolio managers, custodians and designated depository participants, and alternative investment funds. SEBI notes that, while industry-developed standards produced in consultation with SEBI have been viewed as supporting good governance and high-quality compliance and easing compliance, the pilot structure meant there were no common norms for ISF formation and functioning, resulting in differing approaches across fora on matters such as which regulations and circulars to take up, when SEBI should be consulted, and how industry views should be gathered. The manual, developed based on feedback and discussions with various ISFs, is intended to promote a more representative ISF structure so that implementation standards reflect practical compliance challenges, and is available on the SEBI website under Legal and Advisory or Guidance.