SEBI Proposes Overhaul of Social Stock Exchange Framework

SEBI has put forth proposals to broaden the definition of Not-for-Profit Organizations, include diverse activities like arts and culture as social enterprises, and facilitate more NPOs registering on the Social Stock Exchange without immediate fundraising obligations. Feedback is invited until February 2023, aiming to refine the regulation introduced in 2022.

The Securities and Exchange Board of India (SEBI) has suggested revamping the Social Stock Exchange (SSE) framework. The proposed changes aim to redefine Not-for-Profit Organizations (NPOs) to include entities promoting arts, culture, and disadvantaged groups' welfare as social enterprises.

Under the new proposals, NPOs would be allowed to register with the SSE for two years without fundraising. This change seeks to address the cost concerns related to annual reporting and social impact assessments which currently deter many organizations from renewing their SSE registration.

Feedback on these reforms, which also propose amending the definition of social impact assessment firms, expanding eligible activities, and enhancing transparency, is welcome until February 10. The updated framework endeavors to make regulations more inclusive and align with SEBI's objectives.

(With inputs from agencies.)