SEBI Officials Alert FinMin Of 'Toxic' Work Culture Under Madhabi Buch Leadership

This update comes amid ongoing controversies involving SEBI Chairperson Madhabi Puri Buch, who is under scrutiny for alleged conflicts of interest related to the regulator's Adani inquiry

Troubles for the Securities and Exchange Board of India (SEBI) seem to continue. In the latest update, SEBI officials lodged an unprecedented complaint with the finance ministry last month, alleging that the capital and commodities market regulator's leadership has cultivated a toxic work environment.

An August 6 letter describes: "Shouting, scolding and public humiliation have become a norm in meetings at SEBI,” according to a report from The Economic Times.

This update comes amid ongoing controversies involving SEBI Chairperson Madhabi Puri Buch, who is under scrutiny for alleged conflicts of interest related to the regulator's Adani inquiry. Additionally, questions have been raised about her compensation from her former employer, ICICI Bank. 

Additionally, Zee Group founder Subhash Chandra accused her of corruption on Tuesday. Both Buch and ICICI Bank have denied any wrongdoing. SEBI has stated that the issues with employees have been resolved, with the regulator asserting in an email, "The issues referred in your mail have already been addressed by SEBI.”

"Engagement with employees for resolution of their issues is a continuous process," it said, as per the report.

The regulator employs approximately 1,000 officers of Grade A and above (assistant manager and higher), with around 500 signing the letter. 

Titled "Grievances of SEBI Officers-A Call for Respect," the letter alleges that under Buch's leadership, the management employs "harsh and unprofessional language" with team members, closely monitors their "minute-by-minute movement," and imposes "unrealistic work targets with changing goalposts.”

This marks a first for SEBI in history, as its officers have voiced concerns about adverse workplace practices, which they claim have negatively impacted mental health and disrupted work-life balance.

The officials stated that they approached the finance ministry after their complaints to the management were answered. According to the five-page letter, the management has implemented regressive policies and overhauled systems in the name of increasing efficiency, states the report.

The "core of their grievance" is the leadership's tendency to "call names" and "shout" at staff. According to the officers, unprofessional language is casually used by individuals at the highest levels, creating a situation where there is no protection from senior management.

They reported that many employees, including those in higher grades, have refrained from voicing their concerns out of fear of retaliation from senior leaders. While the regulator is trying to enhance conditions for external stakeholders, the letter notes a "growing mistrust among its employees." It claims that "fear has become the primary driving force in SEBI over the last 2-3 years.”

The letter describes the workplace atmosphere as increasingly oppressive. "Time and time again it has been spoken that Sebi is adopting best-in-class technology to improve efficiency of work done. However, the senior management seems to conveniently forget to also adopt best-in-class man management, leadership, and motivation methods towards its employees. This method of leadership wherein employees are browbeaten into submission with shouting, using harsh and unprofessional language has to stop,”  according to the letter.

In response, SEBI said that it has made changes to address the work environment. "In respect of the work environment, format of review meetings has been changed. Hence, issues (with regard to) meetings stand addressed," SEBI said. The regulator added that the two associations representing SEBI employees acknowledged these changes in emails dated September 3.

Unrealistic Targets

The officers also raised concerns about the recent installation of turnstile gates to monitor employee attendance, arguing that these gates give management excessive control over employee movements and pose challenges for those with visual impairments. SEBI responded that the gates were installed recently and that a review of their necessity will be conducted after six months based on employee feedback.

Additionally, the officers criticised the management for increasing key result area (KRA) targets by 20-50 per cent for the year, setting unrealistic expectations for employees to meet by December, which has caused stress and anxiety. They noted that the in-house mental health counsellor once rarely visited, is now overwhelmed with cases of mental health issues.

SEBI said the KRA targets were developed through consultations and reviewed with all departments. Multiple levels of management have reaffirmed the targets as reasonable, with only minor adjustments made in a few departments.