SEBI draws line between listing norms and RBI rules in guidance to PNB

Markets regulator Securities and Exchange Board of India (SEBI) has clarified to Punjab National Bank (PNB) that placing the quarterly Integrated Filing (Governance) report before the board of directors is mandatory and cannot be substituted by oversight through a board committee, even if such delegation is permitted under Reserve Bank of India (RBI) governance norms. 

In an informal guidance letter dated February 6, 2026, SEBI said that the requirement under Regulation 27 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with its circular dated December 31, 2024, is distinct from the RBI’s governance framework and must be complied with independently. 

The clarification followed an application filed by PNB on January 2, 2026, seeking interpretative guidance under the SEBI (Informal Guidance) Scheme, 2025. The public sector bank had asked whether, in line with RBI (Commercial Banks – Governance) Directions, 2025, the board could delegate oversight of the Quarterly Integrated Governance Report to the audit committee or a similar committee of the board. 

PNB had pointed out that under Chapter II, Clause B(18)(v) of the RBI Directions, public sector banks are allowed to assign certain matters, including those related to statutory and regulatory compliance, to board committees to enable the board to focus on strategic issues. The bank said the matter had also been referred to the National Stock Exchange of India, which conveyed a negative view on such delegation. 

In its response, SEBI said the December 31, 2024 circular mandates that the compliance report on corporate governance under Regulation 27(2)(a) of the LODR Regulations must be filed quarterly within 30 days from the end of the quarter and that the listed entity must affirm that the report has been placed before the board of directors. The entity is also required to disclose any comments, observations or advice given by the board. 

SEBI noted that while the RBI Directions permit monitoring of compliance through a board committee, this cannot be regarded as compliance with the LODR Regulations and the SEBI circular. “Therefore, the monitoring of compliance requirements by a committee of the Board of Directors in terms of the RBI Directions cannot be regarded as a compliance with the aforesaid provisions of the LODR Regulations and the Circular dated 31.12.2024,” the regulator said. 

Accordingly, SEBI said placing the corporate governance compliance report before the board of directors remains a mandatory requirement for all listed entities, including public sector banks listed on stock exchanges. 

SEBI also clarified that the informal guidance letter reflects the regulator’s position based on the facts presented by PNB and does not amount to a decision of the board on the questions raised. The guidance does not override other applicable laws, regulations or requirements and different facts or conditions could lead to a different conclusion.