Sensex@40: SEBI chief shifts focus from scale to quality, governance and risk

Marking 40 years of the Sensex, SEBI Chairman Tuhin Kanta Pandey said India’s capital markets are entering a phase where quality, governance and technological resilience will matter as much as scale and participation.

Addressing a BSE event on Friday, January 2, Pandey said the Sensex represents more than an index, reflecting the institutional evolution of India’s securities market and its role in economic transformation. “This moment invites us to reflect not merely on market movements or headline numbers, but on the institutional journey of India’s securities market,” he said.

From manual trading to market maturity

Tracing the market’s evolution from manual trading to a technology-driven ecosystem, Pandey noted that the Sensex has mirrored India’s shift towards private enterprise, services-led growth and deeper global integration.

He highlighted that some companies have remained Sensex constituents since inception, underscoring the importance of governance and long-term value creation. “Enduring value is built across generations,” he said.

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Pandey said the growth of volumes and investors has been matched by institutional reforms, including stronger clearing systems, depositories and regulatory oversight. “No market can sustain growth without trust. And trust, in turn, rests on appropriate regulation, transparency and effective enforcement,” he said.

Governance, technology and the next phase

He outlined steps taken to strengthen governance of market infrastructure institutions (MIIs), including mandatory independent performance evaluations, tighter board norms and clearer reporting structures for senior technology and security officers. These measures, he said, are aimed at ensuring “institutional governance remains robust and credible” as markets scale.

Looking ahead, Pandey said SEBI’s priorities include stronger corporate governance, sustainable finance, innovation with investor protection, and responsible use of technology.

He said artificial intelligence will increasingly shape supervision, citing tools such as SEBI Sudarshan for detecting unauthorised digital activity and AI-driven systems for monitoring advertisements and corporate disclosures.

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“Geopolitical uncertainty, technology and global linkages bring new efficiencies but also fresh complexities,” Pandey said, adding that the next frontier lies in anticipating risks before they surface.