.According to top Sebi sources, the issue of executive directors being present on various committees of stock exchanges and the harmful fallout of this was raised at an internal meeting of the regulator recently, where it was pointed out that this practice should be discouraged.

It is learnt that there was an in-principle approval for the measure and that it would be formalised in the near future.

In fact, a section of the Sebi top brass also feels that senior Sebi officials should not even grace the boards of any stock exchange considering that they are the overall regulators.

Currently, there is one Sebi executive director on every stock exchange board. In addition to this, some executive directorslike Singhvi for instance, were even part of some committees like the market operations and disciplinary action committees of bourses on whose board they had been appointed.

In the case of Singhvi, who heads the crucial investigations wing of Sebi, presence on the committee of an exchange, which was investigating in detail for alleged lapses by certain brokers, was not considered ethical by him.

"Even the presence of a Sebi executive director on the board of a stock exchange is undesirable. Just imagine if an exchange is accused of having violated some norms and is indicted by Sebi for the same. ``Will the Sebi executive director, who was on the board of the exchange, be also severely indicted for having failed to check such an error on the part of the exchange," asked a senior Sebi official on condition of anonymity?"Being on a committee looking into micro-issues is even worse. A senior Sebi official is expected to look at the regulation of the entire market and not get bogged down with day-to-dayfunctioning of a particular exchange," he added.

In fact, Sebi sources point out that former Sebi chief SS Nadkarni had initiated a move to ensure that no ED is on the board of any stock exchange and some senior Sebi officials say that it is time that this practice was revived. "It is a clear case of ethics. One would not like to be part of a committee which takes a decision which would be questioned by oneself. Being part of committees can also lead to an official getting unecessarily close to a particular exchange which is not correct considering that there are over 20 stock exchanges in the country," said another senior Sebi official.