Sebi for dual nod to appoint ind directors

NEW DELHI: Seeking to further strengthen the regulatory framework for independent directors, Sebi proposed putting in place a dual approval system for their appointment as well as removal, and disclosure of entire resignation letters of such directors.

In a significant move, the regulator has suggested that independent directors' appointments should be cleared by the "majority of the minority" shareholders under the dual approval system. Minority shareholders would mean those other than the promoter and promoter group.

Besides, the watchdog has mooted whether ESOPs with a vesting period of five years should be allowed instead of profit-linked commission for independent directors as part of reviewing their remuneration structure.

Sebi on Monday issued a consultation paper for reviewing the regulatory provisions related to independent directors, giving minority shareholders a greater say in their appointment, re-appointment and removal.

Other proposals include broadening eligibility criteria for independent directors.