The requirement to constitute a risk management committee will be expanded to more companies and its role expanded to include ESG risks.
SEBI (Securities and Exchange Board of India) has issued a new consultation paper proposing to expand the applicability and role of risk management committees at listed companies.
The move is aimed at enhancing corporate governance of listed companies, in line with recommendations provided by an expert panel constituted in 2017.
The requirement to constitute a risk management committee was previously extended to the top 500 listed companies based on market cap, from just the top 100 listed companies previously.
In the latest circular, SEBI proposed to extend the requirement to the top 1,000 listed companies, based on market cap.
The roles and responsibilities of the risk management committee is defined by the board of each individual company. SEBI previously expanded this to mandatorily cover cyber security and related risks.
In the latest circular, SEBI has further expanded the risk management committee’s role to include the formulation of a risk management policy, which shall include the identification of internal and…
