 "Market regulator Sebi may water down skin-in-game rules for MF executives")
Market regulator Sebi may water down skin-in-game rules for MF executives
The Securities and Exchange Board of India (Sebi) has shown intent to relax the skin-in-the-game norms applicable to senior executives of the mutual fund (MF) industry. In a discussion paper, Sebi has proposed to reduce the minimum mandatory investment requirement for the designated MF employees, especially those with lower in-hand salary.
Since July 2021, MFs paid 20 per cent of salaries of senior MF executives in the form of units of schemes they oversee. This framework was introduced to ensure the interest of money managers is aligned with that of the investors. Over the years, Sebi had received several requests to water down the requirements, citing challenges faced by MF personnel. The regulator comprised an ease of doing business (EODB) working group to review the present framework. The EODB has made several recommendations around tweaking the lock-in period, reducing minimum investment and disclosures.