SEBI Mandates Top 100 Listed Companies to Verify or Dismiss Market Rumours

SEBI tightens disclosure rules for listed companies. Effective from October 1 the top 100 listed firms by market capitalization will be required to confirm, deny, or clarify market rumors reported in mainstream media. The rule will extend to the top 250 entities from April 1, 2024. SEBI aims to address concerns over certain shareholders enjoying perpetual special rights. Special rights granted to shareholders will be subject to shareholder approval every five years. Directors appointed to a listed entity’s board will require periodic shareholder approval, reducing board permanency. Agreements affecting management or control must be disclosed, while agreements related to business operations will be excluded. Additional rules focus on disclosure of slump sales, reducing timelines for disclosure of material events or information, disclosure of fraud and defaults, cybersecurity incidents, and timely filling of key managerial vacancies. The amended LODR rules will be effective from July 14.