MPW 2022: How Madhabi Puri Buch is transforming Sebi

Change, they say, is the only constant. And Madhabi Puri Buch personifies change, at least for the markets regulator Securities and Exchange Board of India (Sebi). When she entered Sebi’s corner office around a year ago, she brought with her an important cultural change at the regulatory body.    

Buch, the first non-IAS Chairperson of Sebi since 2002 (former LIC chairman G.N. Bajpai was named Sebi chief in 2002), brought in a culture that was more in sync with the corporate world. Suddenly, one could see the regulator’s top brass making powerpoint presentations at conferences, instead of the age-old practice of reading out from a prepared speech. 

One also saw a big change in the manner in which officials of the watchdog—formed in 1988—were evaluated in terms of performance. Six months into her tenure—Buch took over as Sebi’s first female chief on March 2, 2022—she set the ball rolling to make the regulator more “developmental and facilitative” in its approach. Buch—who returns to Business Today’s Most Powerful Women in Business list this year after 2010, when she was MD & CEO of ICICI Securities—identified Sebi staff across departments to engage actively with industry and market participants to get their views and feedback, and help formulate better policies for the development of the market. More importantly, these responsibilities were made part of their KRAs or key responsibility areas.   

“There is now in every department at least one individual—usually three—whose KRAs for the year are very simple. You will implement policy which should be developmental and facilitative in nature, which the industry will send. That’s the brief,” she had said in September 2022.   

If there is one thing that the Sebi chief never gets tired talking about, it is the combined prowess of data and technology. When BT asked her what matters to her the most while making crucial and tough business decisions, Buch said she ensures that “… all stakeholders have had the opportunity to present their data and that I have looked at all their data completely objectively”.   

In October 2022, while delivering the Foundation Day Lecture of IIM Bangalore—Buch is an alumna of St Stephen’s and IIM Ahmedabad—she spoke at length about the advancements that Sebi has made in terms of harnessing technology and data to prevent or minimise wrongdoings in the securities market. She highlighted that Sebi had developed in-house an algorithm that throws alerts related to insider trading and front running. Incidentally, she had once called technology a “magic bullet” that could help stakeholders in various areas of the market including compliance, cost reduction and controls, among other things.   

As she completes a year in office on March 2, Buch has spearheaded many important initiatives including those related to reviewing and upgrading archaic laws that were put in place decades ago. Norms related to buybacks, the role of mutual fund trustees, alternative investment funds (AIFs), public issues, real estate investment trusts (REITs) and investor grievance redressal mechanism are among those that have already been reviewed and updated or are currently under review.   

She also oversaw the transition of the Indian stock markets as they became one of the fastest in the world in terms of settlement with the introduction of T+1 settlement mechanism in January.  

She was even quick in tweaking—tightening, to be more precise—the regulatory framework for public issues after a slew of initial public offerings (IPOs)—especially those from the start-up world—brought to the fore issues that needed to be addressed fast.   

Buch, who has worked with organisations like ICICI Bank, Greater Pacific Capital and New Development Bank (as a consultant), was also at the helm when Sebi passed orders against names like Mehul Choksi, Brickwork Ratings, Bombay Dyeing, CG Power, Parsvnath Developers, Indian Commodity Exchange, and Fortis Healthcare, among others.   

One aspect, however, that has attracted some amount of criticism has been the average time taken by Sebi to complete investigations. And, Buch would certainly go back to data and technology to address and respond to this criticism as well.   

Prior to becoming the Sebi chief, Buch was the only female whole-time member of the regulator till date. As a whole-time member, she handled important portfolios including departments such as market regulation, market intermediaries’ regulation & supervision, integrated surveillance and information technology, among others. In one year, Buch has definitely ushered in the winds of change at Sebi.

For the full list of the Most Powerful Women in Business 2022 winners, do read the forthcoming issue of Business Today dated March 19