Securities and Exchange Board of India (Sebi) staffers have expressed their displeasure with the market regulator for considering external candidates for the post of executive director (ED).
The Sebi Employee Association (SEA) sent a letter, dated June 26, to chairman Ajay Tyagi saying “external candidates may be considered only when no suitable internal candidates are available”. On this very day, Sebi had put out an advertisement inviting applications for recruitment of two EDs on contractual or deputation basis for a three-year period and asked candidates to apply by July 17.
There are eight EDs at Sebi, of which the contracts of two — Sujit Prasad and Anand Baiwar — are ending in October and November, respectively. However, the total sanctioned strength for the post is nine.
This is not the first time when employees have raised concerns on hiring external candidates for the post. In 2017, a similar issue had been raised. They had then sought a change in a rule that said that the regulator has to recruit half of the EDs from outside Sebi.
Giving in to employee demand, Sebi had decided to increase the number of ED posts to nine from eight. It kept six posts for internal candidates and the rest were to be filled on lateral or on deputation basis.
“At the time of the last promotion of an internal candidate to ED level, we had been given to understand that appropriate changes would be made in the Employee Service Regulations to reflect the stream-wise posts for EDs, in line with the separate streams till the level of chief general managers (CGMs). No progress has been made for bringing clarity on this issue,” the SEA said in its letter.
“The SEA has always argued that candidates for the post of ED must have relevant operational knowledge and experience, irrespective of whether they are taken internally or externally. The experience with ED appointments in the past more than five years has vindicated SEA’s submissions that the most appropriate and qualified candidates have been found internally,” the association highlighted.
It further said while specialisation has been recognised till the level of CGMs in Sebi, unfortunately, at ED level, the regulations do not formally recognise qualifications or stream-wise specialisation. “This, along with failure to recognise internal experience and expertise could lead to less than appropriate appointments. Thus, the number of ED posts may be rationalised based on stream-wise specialisation with adequate consideration to staff strength,” the letter said.
Referring to Sebi’s history, the SEA said that the regulator had seven EDs in 2000 with a staff strength of less than 400, while today it has only nine EDs when staff strength has more than doubled to around 900. The hierarchy above EDs has also expanded to four whole-time members, whereas there were no such posts in 2000, it said.