SEBI Suggests Tweaks To Corporate Governance Reporting By HVDLEs

On Friday, the Securities and Exchange Board of India (SEBI) released a consultation paper proposing modifications to the disclosure requirements for high-value debt-listed entities (HVDLEs).

The regulator suggested that HVDLEs submit a secretarial compliance report to stock exchanges within 60 days of the financial year-end and a Corporate Governance compliance report within 21 days of each period. It also proposed detailed disclosure norms related to Related Party Transactions (RPTs), requiring prior review and approval by the audit committee, debenture trustee, and shareholders. Omnibus approvals by audit committees would be valid for one year. SEBI also proposed guidelines for RPT-related shareholder notices and alignment of omnibus RPT approval periods with AGMs. Public comments are invited until May 26.

The proposed changes aim to enhance oversight of material transactions by ensuring that audit committees annually review long-term or recurring RPTs. SEBI also recommended that notices to shareholders include key justifications and comparisons with similar transactions between unrelated parties to help assess fairness.