Amendments to Rules of the National Stock Exchange

  • The composition of the Board shall consist of the following categories namely Public Interest Directors, Trading Member Directors, Shareholder Directors and SEBI may nominate Directors on the Board as and when deemed fit. The Chief Executive shall be an ex-officio Director on the Board.


Board Composition

The composition of the Board shall be as under:

  • Public Interest Directors (PIDs) shall constitute one-fourth of the total strength of the Board.
  • Trading Member Directors shall constitute a maximum of one-fourth of the total strength of the Board.
  • Shareholder Directors shall constitute the balance of the Board.
  • In case SEBI nominates Directors on the Board of NSE, then the SEBI Nominee Director shall be duly absorbed on the Board by appropriately readjusting/altering the strength of Trading Member Directors than Shareholder Directors.


General Requirements

  • The Directors except the Public Interest Directors and the Chief Executive such as Chief Executive Officer, Executive Director, Managing Director, etc. shall be elected by the Shareholders.
  • No director shall hold office for more than two consecutive terms.
  • 'Trading Member Directors' shall be elected from amongst the Trading Members.
  • 'Shareholder Directors' shall be elected from amongst the Persons, who are not Trading Members or Associates of Trading Members.
  • 'Public Interest Directors' shall be selected by the Board from amongst the Persons in the SEBI constituted panel. A person shall not act as 'Public Interest Director' on more than one Stock Exchange simultaneously.
  • The Chairman shall be elected by the Board from amongst the non-executive non trading member directors. If, for some reason, it is not possible for the Board to elect a Chairman, the Board may elect a Chairman for every meeting of the Board from amongst the non-executive non-trading member directors of the Board.
  • The manner of election, appointment, tenure, resignation, vacation, etc. of Directors (except the Chief Executive) shall be governed by the Companies Act, 1956 save as otherwise specifically provided under or in accordance with the Securities Contracts (Regulation) Act, 1956.
  • The Chief Executive shall be an ex-officio Director on the Board.
  • No approval of SEBI shall be required for appointment of any Director, except for the Chief Executive.
  • SEBI may nominate Directors on the Board as and when deemed fit.


Chief Executive



The appointment, renewal of appointment and the termination of service of the Chief Executive shall be subject to prior approval of SEBI. However, the Exchange shall determine the manner of selection, terms and conditions of appointment and other procedural formalities associated with the selection/appointment of the Chief Executive. The Exchange shall carry out necessary due diligence with respect to the verification of antecedents, credentials andexperience of the proposed person as Chief Executive. The Exchange shall constitute a Committee for the selection of Chief Executive. The Committee shall generally consist of four persons, one representative from the exchange,two outside experts and one Public Interest Director. However, constitution of the said Committee shall not require SEBI approval.

The elected directors shall not interfere in the day to day management of the Exchange, particularly relating to the surveillance and risk management functions.

Besides the Board, it shall be the duty of the Chief Executive to give effect to the directives, guidelines and other orders issued by SEBI in order to implement the applicable provisions of law, rules, regulations as also the Rules or the Articles of Association, Regulations and Byelaws of the stock exchange. Any failure in this regard will make him liable for removal or termination of services by the Exchange with the prior approval of SEBI or on receipt of direction to that effect from SEBI, subject to the concerned Chief Executive being given an opportunity of being heard against such termination.