Fear and distrust of the media now extends to regulators as well. One of the first actions after Mr Ajay Tyagi has taken over as chairman of the Securities & Exchange Board of India (SEBI), is a circular that effectively gags SEBI officers and bars them from talking to the media without prior permission. On 10th March, shortly after office hours, an email went to all SEBI officers from Mr Jayanta Jash, Chief General Manager in charge of Human Resources. It said:
“Attention of staff members is drawn to regulation 53 of SECURITIES AND EXCHANGE BOARD OF INDIA (EMPLOYEES' SERVICE) REGULATIONS, 2001).
Contributions to the press
53. (1) No employee may contribute to the press without the prior sanction of the Competent Authority or without such sanction make public or publish any document, paper or information which may come in his possession in his official capacity.
(2) No employee shall except with the previous sanction of the (2) competent authority publish or cause to be published any book or any similar printed matter of which he is the author or not or deliver talk or lecture in any public meeting or otherwise.
Provided that no such sanction is required, if such broadcast or contribution or publication is of a purely literary, artistic, scientific, professional, cultural, educational, religious or social character.
Further, it is advised that staff members shall not meet or talk with media except with explicit permission of competent authorities. Violation of the above would be viewed seriously and may result in disciplinary action.”
A simple reading of Section 53 shows that it pertains to SEBI officers writing or publishing articles in the media or books. It does not and should not bar officers from speaking to the media. Is the new SEBI chairman extending the scope and application of the employee service regulations without proper clearances? There are two other issues here. First, it goes against the spirit of transparency that the government under Prime Minister Narendra Modi has promised. But worse, a regulatory body is only as good or effective as its ability to gather market intelligence and remain a jump ahead of scamsters and market manipulators.
Over the years, every SEBI chairman who has lodged itself in the imposing SEBI Bhavan, has systematically worked at cutting off all contact with various stakeholders. SEBI officials rarely meet investors, and now, its officials are barred from meeting the media without prior permission. Interestingly, in the days when the prime minister himself and his entire cabinet including various ministries interact directly with the public, India’s financial regulators wish to remain in a cocoon. The insurance regulator can’t be seen in social media while the Reserve Bank of India and SEBI merely push out information but do not engage. It remains to be seen how SEBI intends to engage with the media over the next three years, under a new chairman.
Moneylife wrote to SEBI Chairman Ajay Tyagi for his response and even followed up with his communications head, but we have received no response.