Shift in leadership landscape? Non-govt chiefs at financial regulators

Will more regulators such as Trai follow suit?

In the list of 10 key regulatory institutions in India, a development has emerged. For the first time in 20 years, two chairpersons, both in the financial sector – namely the Securities and Exchange Board of India (Sebi) and the Pension Fund Regulatory and Development Authority (PFRDA) – are simultaneously not from the government. However, it is early to say whether this trend will continue.

This list gains significance amid reports that the next chief of the Telecom Regulatory Authority of India (Trai) might be from the private sector.

An assessment of the recruitment for the chairperson's post reveals no distinctive preference for government officers, either serving or retired, with the exception of the Petroleum and Natural Gas Regulatory Board.

For four institutions – Trai, Central Electricity Regulatory Commission (CERC), Food Safety and Standards Authority of India (FSSAI) and Airports Economic Regulatory Authority (AERA) – serving and retired government officers are included in the zone of consideration. However, even for them no preference is indicated between experts and government officers in the choice to be made. In five other institutions, the recruitment condition makes no mention of government officers, opening the door, in principle, for individuals from various sectors to join at the top post within the current framework.

Yet, as the list illustrates, eight regulatory bodies are currently led by government officers, predominantly from the Indian Administrative Service (IAS). (This enumeration excludes periods when the top position was held on an officiating basis.)

Notably, Sebi and PFRDA have seen non-government officers assume top leadership roles before, with both experiencing this three times, including the present appointments.