Sebi chief appointment: Yes, do employ her for a better future

The much-awaited notification has come.

The Union finance ministry has called for applications to the coveted post of chairman of the Securities and Exchange Board of India.

The change of guard at the market regulator, after five years, will be one of the most followed and speculated-on processes this year.

A just-retired officer based in the capital is likely to throw his hat in the ring, say some.

A Mumbai official who shares his first name with the first officer is another strong candidate.

Then, there are people who've had earlier stints at the regulator, beside bright bureaucrats.

We will read about all these and more as the race heats up in the coming weeks.

The notification has some interesting terms.

The new chairman will get a consolidated monthly salary of Rs 450,000 a 50 per cent rise from the Rs 300,000 a month that incumbent U K Sinha got when he began his innings five years earlier.

Despite this ‘handsome’ hike, the emoluments would considerably fall short of what a lower to mid-level corporate executive takes home.

Top lawyers would demand this sum for a couple of court appearances.

Top-class market talent in the private sector might not find sufficient motivation to take part in the process, even if the government wants it to.

The package is perfect, though, for a retired or ‘about to retire’ bureaucrat.

Two phrases in the application leave room for a hope that the next chairman could be a ‘young’ person, going by local standards for regulators.

Applicants can be in the age group of 50-60 years.

Second, the chairman “shall hold office for a period of five years and shall not hold office beyond 65 years, whichever is earlier.

He is eligible for reappointment”.

Read together, this raises the possibility of a person in the early 50s or around 55 taking charge and having a reasonably long term.

If the reappointment is for an equal period, this person can have an unprecedented 10-year term.

A double–edged sword, for if the government’s choice goes bad, the Street is stuck for the next decade.

However, let us be optimistic and hope the prime minister gives his nod to a bright, ‘young’ candidate, with integrity, adequate knowledge and a willingness to learn.

Let us also hope that this choice is made with enough conviction that an extension is a formality.

Frequent changes, having three chairmen in the past 10 years, have certainly not worked for investors.

There have been policy U-turns each time a new person has checked in.

Some insiders even joke that there have even been “W-turns” and “Y-turns”.

Worse, some changes even resulted in public squabbling and name calling that soiled the reputation of the institution, even more than these damaged that of the individuals concerned.

A person blessed with a long tenure would be in a better position to take the securities market in the path of progress.

Such stability and certainty in policy direction is what global investors look for in mature markets.

But, a typo at the end of the notification, which can be seen as prophetic, suggests a little twist in the tale.

“TO BE FILLED BY EMPLOYHER”, it says.

Perhaps, in a first, they will indeed Employ a Her. It is high time.