Best regulator in the world

While regulators in the USA and Europe are quickly covering their backs after the crisis of 2008, designing inappropriate rules that will only contribute to the next crisis, it is perhaps a legitimate question to ask – Where should we be going? – Who does a good job as a regulator?

You could be very detailed in your selection criteria but two key questions might be:

• Who survived the crisis unscathed?
• Who has made the most contribution to market improvements?

So obviously the USA and Europe are disqualified. Remaining candidates would include (it’s a short list) Australia and India. Both qualify on the first criteria but on the second - India is way ahead of everybody else. SEBI has done more than any other regulator in the world in pushing for market reforms, modernisation and better practices. The recent name and shame of all those funds that did not submit their FII renewal on time is a good example - there's some big names in there. If only the SEC had done the same for Madoff half the crisis would have been avoided. The recent spat between SEBI and MCX (one of the local exchanges) just proves that the regulator has the guts to act and stand behind its rule book. A lesson for all those bureaucrats that hide behind their authority.

Tim Reucroft, Director, Investor Services
treucroft@thomasmurray.com