The Financial Sector Legislative Reforms Commission (FSLRC), chaired by retired Supreme Court Justice Shri B N Srikrishna, submitted its Report to the Government on March 22, 2013. The Report contains various recommendations, legislative and non-legislative. The said Report in English and Hindi is available on the Department of Economic Affairs, Ministry of Finance website: finmin.nic.in. There are a number of recommendations in the Report which are in the nature of governance enhancing and do not require legislative changes. It has been decided that in the first instance, Financial Sector Regulators may voluntarily adopt the governance enhancing recommendations within a reasonably proximate timeframe.

With a view to facilitating the task of regulators and help developing a uniform rationale based understanding about the non-legislative governance enhancing principles, a detailed ‘Guidance Handbook’ has been prepared which essentially includes governance enhancing provisions/recommendations, their rationale, suitable examples of global good governance practices and guidance on implementation. These recommendations encompass issues relating to consumer protection, consumer protection for retail customers, timeline for regulations on consumer protection, requirements for framing regulations, notices to regulated entities, transparency, transparency in Board meetings, reporting, approvals, investigation, adjudication, imposition of penalty and capacity building.

The ‘Handbook’ has been circulated to the Financial Sector Regulators and the same is put in public domain on http://www.finmin.nic.in website for the information of public at large.

Voluntary implementation of governance recommendations promotes non legislative consumer protection and regulatory transparency reforms. The guidance handbook urges financial sector regulators to undertake Voluntary Implementation of selected non legislative, governance enhancing recommendations from the FSLRC, providing rationale, global practice examples, and operational guidance on consumer protection, rule framing, transparency in board meetings, reporting, investigation and adjudication processes, penalty imposition, and capacity building; the handbook has been circulated to regulators and published publicly for reference.