Appointment of Chairman and MD CEO of Listed Entities  

PUBLISHED ON: 24-03-2022

SEBI has amended the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“LODR Regulations”) and the changes are set out hereunder:

  • As per LODR Regulations, the top 500 listed entities were required to ensure, by April 1, 2022, that the Chairman of the board of the listed entity is:
    • a non-executive director; and
    • not related to the Managing Director or Chief Executive Officer, in accordance with definition of  “relative” under Companies Act, 2013.
  • Pursuant to the amendment, the aforementioned requirement has been deleted and is no longer mandatory.
  • Now, a listed entity may, at its discretion, appoint separate individuals to the positions of Chairman of the board and Managing Director or Chief Executive Officer of the listed entity, so that the Chairman of the board is: (i) a non-executive director, and (ii) not related to the Managing Director or Chief Executive Officer.

The aforementioned changes have been made vide SEBI (Listing Obligations and Disclosure Requirements) (Second Amendment) Regulations dated March 22, 2022 (available here).