At present, the Chairman of SEBI is Shri Ajay Tyagi who took charge in March 2017. SEBI’s chairman is appointed by the central government, and although his term was completed on 1 March 2020, the government has extended his term for 6 months.

There are currently 16 stock exchanges in the world with a market capitalization of over US$1 trillion. While the New York Stock Exchange (NYSE) ranks first in the world on the basis of parameter market capitalization. 

The Indian capital market is also one of the largest capital markets in the world.

If there is any business in the market, then an organization is needed to monitor it. Like RBI is there to monitor the banks in India, similarly, SEBI came into existence to monitor the stock market.

What is SEBI?

SEBI is a statutory body and a market regulator, which regulates the securities market in India.

The basic function of SEBI is to protect the interests of investors in securities and to promote and regulate the securities market. , SEBI is governed by its board members.

The board consists of a chairman and several other full-time and part-time members. The chairman is nominated by the central government.

SEBI ka full form Securities and Exchange Board of India.

The reason behind of Establishment SEBI

Problems like informal private placement without any authority, price rigging, and informal merchant bankers started violating the rules and regulations of the stock exchange which delayed the delivery of shares.

The government felt an urgent need to set up a regulatory body to regulate its functioning and to find solutions to all the problems faced by the market, as people were losing faith in the market.

To maintain this faith of the people, the Security and Exchange Board of India was established by the Government of India.

Main points of SEBI’s work

  • Keeping an eye on the stock market.
  • Broker control
  • Insider trading investigation
  • Protection of investors
  • Regulation of stock exchanges
  • To protect the interests of the investors in the securities market and to regulate and develop the securities market through appropriate measures.
  • To decide the rules of business of the Stock Exchange, Mutual Fund House, and any other securities market.
  • Regulating and registering the work of stock brokers, sub-brokers, share transfer agents, trustees, merchant bankers, underwriters, gold exchanges, portfolio managers, etc.
  • To register and regulate Collective Investment Schemes of Mutual Funds.
  • To end Unfair Trade Practices related to the capital market.
  • To train people associated with the capital market and to encourage the education of investors.
  • Prohibition of insider trading in securities.

Powers of SEBI

1. Quasi-Judicial Powers-

SEBI has the right to take decisions on any kind of fraud and unethical practice in the securities market. SEBI is allowed to maintain transparency, accountability, and fairness in the securities market.।

2. Quasi-Executive Powers-

SEBI has the power to inspect the books of account and other documents of the violator in case of violation of regulations in the capital market. If anyone is found violating the rules, the regulatory body has full authority to enforce the rules, pass decisions and take legal action against the violators.

3. Quasi-Legislative Powers-

SEBI has the power to frame suitable rules and regulations to protect the interests of investors. Some of its rules include listed liabilities, business rules, and disclosure requirements. And is designed to protect them from malice.