SEBI mulls mandatory confirmation, denial on media reports by top 250 listed firms
The Hindu
New Delhi
To streamline disclosure requirements, markets regulator SEBI has proposed mandating the top 250 listed companies to confirm or deny any information reported in the mainstream media, which may have material effect on the listed entity.
In addition, SEBI has suggested reducing the timeline to 12 hours from the occurrence of event or information from 24 hours at present for making disclosure to the stock exchanges.
To bring uniformity in the ‘Materiality Policy’ across listed entities, it has been proposed a quantitative criteria of minimum threshold for disclosure of events based on the value or the expected quantitative impact of the event, SEBI said in its consultation paper made public on Monday.
These proposals are aimed at streamlining the disclosure requirements for material events or information required under LODR (Listing Obligations and Disclosure Requirements) rules and keeping pace with the changing market dynamics. The regulator has sought comments from the public till November 27 on the suggestions.
As per the draft papers, “top 250 listed entities shall necessarily confirm or deny any event or information reported in the mainstream media, whether in print or digital mode, which may have material effect on the listed entity under this regulation.” At present, a listed entity may on its own initiative, confirm or deny any reported event or information to stock exchanges under the LODR Regulations.
“Verification of reported events or information which may have material effect on the listed entity is essential to avoid establishment of a false market sentiment or impact on the securities of the entity,” SEBI said.
Listed entities should provide additional quantitative thresholds or criteria for determining materiality of events in their ‘materiality policies’.