Practice of permanent board seats at listed companies likely to end

Sebi also proposes stricter norms for special rights

The Securities and Exchange Board of India (Sebi) has proposed to put a stop to the practice of certain directors occupying permanent board seats at listed companies. The regulator has suggested that the directorship of any individual serving on the board should be subject to periodic approval from shareholders, at least once in five years.

In a discussion paper issued on Tuesday, Sebi said a few promoters enjoyed permanency on the board, giving them an undue advantage, prejudicial to the interests of public shareholders. The issue had come into focus last year when a tussle broke out between Dish TV’s erstwhile