SEBI Proposes Revamp of 'Skin in the Game' Rules for AMC Employees

SEBI has introduced proposals to modify the 'skin in the game' rules for mutual fund employees. The plan suggests altering investment percentages based on salary brackets and excluding non-cash components like ESOPs, to ease compliance. The aim is to provide flexibility while addressing challenges for specific employee roles.

In a bid to modernize compliance for mutual funds, SEBI has proposed significant revisions to its 'skin in the game' policies. The guidelines, tailored for mutual fund employees, are set to introduce investment percentages determined by salary slabs, while excluding non-cash benefits such as ESOPs.

The proposals address challenges faced by employees earning lower salaries and those in operational positions. Currently, key mutual fund employees are mandated to invest 20% of their annual salary in the funds they manage, with this amount locked for a three-year period. SEBI's new strategy seeks to ease this burden.

Public comments on SEBI's proposed adjustments are invited until November 21. This regulatory shift aims to offer a strategic balance between compliance and flexibility, potentially impacting asset management companies across India.

(With inputs from agencies.)