Compliance with the provisions of Equity Listing Agreement by listed companies – Monitoring by Stock Exchanges

Concerns have been raised that even though listed companies make disclosures to Stock Exchanges within the timeframe stipulated under the Listing Agreement; the contents of the disclosures made by such companies are not adequate and accurate. Therefore, investors are unable to take informed investment decisions based on such disclosures. IMF has in its report on " India: Financial Sector Assessment Program- Detailed Assessments Report on IOSCO Objectives and Principles of Securities Regulation "

Accordingly, in continuation of SEBI Circular dated September 30, 2013 and pursuant to the discussions with the Recognised Stock Exchanges and market participants, in order to address the above mentioned concerns, the Recognised Stock Exchanges are advised to:

• Put in place appropriate framework (including adequate manpower) to effectively monitor the adequacy and accuracy of the disclosures made by listed companies;
• Treat inadequacy and inaccuracy of disclosure as non-compliance, wherever applicable and proceed further as per the Standard Operating Procedure laid down by SEBI vide Circular No. CIR/MRD/DSA/31/2013 dated September 30, 2013;
• In order to enable the Recognised Stock Exchanges and the listed companies to put in place adequate infrastructure to ensure compliance with the requirements of this Circular, Recognised Stock Exchanges shall begin with monitoring the adequacy and accuracy of disclosures made by top 500 listed companies (by market capitalization as on March 31, 2013) in compliance with Clauses 35, 36, 41 and 49 of the Equity Listing Agreement for the quarter ending December 31, 2013. 

For more details read the SEBI Circular here