Sebi Tightens Disclosure norms for Mutual Funds

The Securities and Exchange Board of India (Sebi) on Monday asked mutual fund houses to make monthly disclosures about assets managed by them and explain the rationale behind exercising their voting rights in companies, as part of a long-term policy for the industry effective April 1.

The first-ever, long-term policy for over `9 lakh-crore mutual fund industry, aimed to make it an attractive investment proposition for retail investors, also provides for bolstering distribution channels.

The capital market watchdog has suggested selling of mutual funds through public sector banks and online to increase their penetration.

In a circular issued, Sebi said mutual funds would be required to disclose certain additional details about their assets under management (AUM) on a “monthly basis”.

Besides, the data has to put on a consolidated basis on website of Association of Mutual Funds of India (AMFI) within seven working days of the month.

The market regulator also said that mutual funds should disclose the rationale while exercising their voting rights in investee companies.

“Asset management companies (AMCs) shall be required to record and disclose specific rationale supporting their voting decision (for, against or abstain) with respect to each vote proposal,” according to the circular.

Hindustan Times, New Delhi, 25-03-2014

 
     
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