Madhabi Puri Buch, the first woman and private sector head of Sebi, faces unprecedented challenges. Allegations from various quarters, including internal staff and external critics, question her integrity and work culture. Despite support from some industry figures, calls for her resignation are growing louder.
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Being a regulator is arguably one of the most thankless jobs on Dalal Street as you often end up making more enemies than friends by playing the tough cop. But the problem at hand for IIM Ahmedabad alumnus Madhabi Puri Buch is unprecedented in Sebi’s history as she is suddenly being cornered from all sides – both internally as well as externally.
“All these complaints and allegations make a very, very sad reading about the credibility of a regulator, and especially of a market regulator, whose perception about, neutrality, professional and personal integrity is supposed to be above suspicion. So in these circumstances, there is no better thing to do except for her to resign and go away,” former Finance Secretary Subhash Chandra Garg told ETMarkets.
The IAS officer, who has also served as a Sebi board member in the past, said he doesn’t recall any instance when a regulator has been pilloried with so many accusations.
American short-seller Hindenburg was the first one to open fire at her by questioning the Sebi chief and her husband Dhaval Buch’s investment in offshore entities linked to Adani. Congress followed it up by questioning why she has been getting payments from ICICI Bank, while Zee’s Subhash Chandra openly called her “corrupt”.
While many have dismissed these charges as “frivolous”, Buch is fighting another battle as her own staff are up in arms against her, saying the top management has made the work culture “toxic”.
The parliamentary Public Accounts Committee (PAC) is also going to look into the allegations against Buch and may even summon her later this month, ET reported earlier today.
“It’s not one isolated thing. This is too much muck,” Garg says.
Buch is not only Sebi’s first woman head but is also the first one from a private corporate background.
An undergraduate in mathematics from Delhi’s St. Stephens College, Buch held various roles at ICICI Bank and was also the CEO of ICICI Securities from 2009 to 2011. After joining the watchdog as its whole-time member from 2017 to 2021, she was appointed as the Chairperson in March 2022. Her 3-year-term ends in March 2025.
Garg disagrees with the suggestion that Buch is being unfairly targeted by vested interest groups. “These are results of indiscretions and to a great extent, acts which are more of commissions than omissions. It’s more of what you’re doing rather than where you’re coming from,” he argues.
Industrialist Harsh Goenka came out in Buch’s support saying she may have made some enemies because of not being diplomatic enough.
“It’s disheartening to see Madhabi Puri Buch, head of SEBI, being cornered despite her strong moral values and integrity. Diplomacy may not be her strength, and it seems she’s made some enemies because of it. However, I’m confident she’ll rise above it all and come out stronger,” Goenka wrote on X.
As all the allegations have come one after the other, Shriram Subramanian of proxy advisory firm InGovern Research said it appears that there could be someone instigating the employees to protest.
“This episode looks unprecedented. To avoid such instances in the future, the government should define a framework for all regulators – their chiefs and full-time members. Their holdings and investments should be disclosed publicly. Today this has happened with Sebi, tomorrow it might be the CCI or any other regulator,” he said.
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