SEBI receives 4,085 complaints in more than four years for violations of corporate governance: government

Sebi, the capital markets regulator, has received 4,085 complaints over the past four and a half years alleging violations of corporate governance standards against 1,551 companies, parliament was told on Tuesday. Of these, 132 complaints against companies were received in the current financial year up to July 13; 640 complaints in 2022-23, 809 in 2021-22, 1,151 in 2020-21 and 1,353 in 2019-20, Finance Minister Pankaj Chaudhary said in a written reply to the Rajya Sabha.

During the past four years and the current year, complaints of corporate governance violations have been received against several companies, including Yes Bank, Zee Entertainment Enterprises, Religare Enterprises, Adani Enterprises, Adani Ports And Special Economic Zone, Adani Power and ACC Ltd.

In the case of complaints of violation of corporate governance standards, Sebi takes the matter up with the affected exchange, which in turn seeks comments from the concerned company, and steps are then taken to remedy such complaints, he added.

Furthermore, in April last year, Sebi established a committee chaired by its former full-time member G Mahalingam on strengthening the governance of market infrastructure institutions.

In complaints against companies regarding violations of rules on misuse or misappropriation of funds; material misstatements in financial statements, etc. Sebi is investigating the allegations and appropriate enforcement action will be taken based on the findings of the investigation.

In addition, through July 13, Sebi’s complaint recovery system SCORES received 239 complaints against entities alleging insider trading or price manipulation in the current fiscal year, the minister said.

Some of the entities against which complaints have been received for alleged insider trading or price manipulation are Adani Enterprises, Bharat Heavy Electricals Ltd, Coal India, HDFC Bank, Vedanta, IIFL Securities and Eros International Media in the current financial year.

Furthermore, a total of 552 complaints have been received in 2022-23, 616 complaints in 2021-22, 1,130 complaints in 2020-21 and 1,801 complaints in 2019-20, according to the data shared by the minister. Sebi Complaints Redress System (SCORES), a complaint redress system launched in June 2011, assists investors to submit their complaints online to Sebi, regarding the securities market, against companies, intermediaries and market infrastructure institutions.

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