- Omnibus framework contains broad parameters viz., objectives, responsibilities, eligibility criteria, governance standards etc. which will be common for all SROs.
- Objectives of SROs include promoting compliance culture, support to smaller entities, act as collective voice of members, collect sectoral information, and encourage R&D culture.
- Eligibility: An SRO shall be setup as a not-for-profit company registered under Section 8 of the Companies Act, 2013.
- It should have adequate net worth, sufficiently diversified shareholding and must represent the sector.
- Characteristics: SRO shall have sufficient authority derived from membership agreements along with strong governance mechanisms.
- It shall develop standards for improving compliance culture and surveillance methods for sector monitoring.
- Responsibilities of SROs:
- Towards members: Promote best business practices, establish minimum conduct benchmarks, disseminate sector specific information and dispute resolution/arbitration structure.
- Towards Regulator: Ensuring regulatory compliance, promote sector development, foster innovation and detect early warning signals.
- Governance framework:
- Articles of Association (AoA)/ bye-laws shall provide for manner of functioning of Governing Body and specify the functions of SRO.
- At least one-third of members in Board of Directors including Chairperson shall be independent.
- Compliance with relevant Acts, regulations, guidelines, directions or circulars issued by RBI.