Surely, SEBI Chief Madhabi Puri Buch would have not anticipated that the “glittery days” would turn into “dark clouds” so soon!

Once absolutely confident of her “no wrongdoing” approach has fast turned into a nightmare of epic proportions and recent headlines suggest that there is indeed more to the Adani scandal, Madhabi Puri Buch, SEBI and what the Hindenburg alleged.

Therefore, with all the revelations, and disgraces coming to light why is Madhabi Puri Buch, the chairperson of the Securities and Exchange Board of India (SEBI), still holding her post?

This is no longer just about potential impropriety or irregularities, but about her style of leadership and the credibility of the office she currently occupies.

India’s stock market regulator, SEBI, is facing growing calls for change, with allegations mounting against Buch.

Congress leader Pawan Khera has alleged that Buch received ₹16.8 crore in benefits from her former employer ICICI Group—an allegation both Buch and ICICI have denied.

While the Congress focuses on her financial connections, the larger issue concerns the appropriateness of her remaining in office amidst these claims.

Here are five reasons why Madhabi Puri Buch should step aside –

1) SEBI Is a Quasi-Judicial Institution

SEBI is not just a regulatory body; it plays a critical, quasi-judicial role in overseeing India’s capital markets.

The SEBI chairperson is responsible for ensuring that companies operate legally and fairly, particularly for the benefit of shareholders, including smaller investors. Given SEBI’s role, the head of the institution must adhere to standards and conventions similar to those of sitting judges.

The impartiality and integrity of this office must be beyond question, especially when overseeing cases involving conflicts of interest or allegations of misconduct. Buch’s position is akin to a Chief Justice for capital markets, and she should be held to the highest ethical standards.

2) The Disclosure Boss Needs to Disclose Better

Buch herself recently joked that even mentioning the word “REIT” (Real Estate Investment Trust) might lead to accusations of conflict of interest due to her husband’s employment with Blackstone.

However, the issue is not about making light of the situation; it’s about transparency. SEBI is at the heart of ensuring proper disclosure in Indian markets, and Buch’s role demands exemplary standards of communication regarding potential conflicts of interest.

Her failure to clearly and publicly disclose her husband’s involvement in related sectors, as well as her own financial ties from her ICICI days, is a red flag.

A disclosure-based institution must be led by someone who proactively provides full transparency.

3) Her Private Sector Style Does Not Fit Her Public Role

Buch’s tenure at ICICI Bank has been marked by strong internal practices, but the approach required in a public office is different from that of a corporate executive.

In the private sector, a CEO is accountable to the board and shareholders.

However, as the SEBI chief, Buch is accountable to a much broader set of stakeholders, including the Ministry of Finance, listed companies, their shareholders, and the citizens of India.

Buch’s leadership has reportedly mirrored the “closed loop” decision-making common in private institutions, which does not align with the open, accountable nature of public office.

4) Questionable Use of Public Funds

While Buch’s private sector success is commendable, her role at SEBI should be guided by the principle of pro bono publico—serving the public good. Drawing large salaries and benefits, particularly from her previous tenure at ICICI Bank, raises concerns.

Public service, especially in an office like SEBI, is meant to be an honor, not a financial windfall. Her lucrative retirement benefits and salaries drawn while at SEBI have raised eyebrows, especially since taxpayers and minority shareholders end up footing the bill.

A public office requires greater sensitivity to how financial compensation is viewed.

5) SEBI Employees Are Revolting

Perhaps most damning of all, hundreds of SEBI officers have lodged a formal complaint with the Ministry of Finance, accusing Buch of fostering a toxic work environment.

The complaint, filed in August, highlighted harsh language, micromanagement, unrealistic targets, and a general atmosphere of fear within the organization.

While Buch’s leadership may be lauded by some as efficient or results-driven, the sheer volume of complaints suggests otherwise. With over 500 Grade A officers expressing dissatisfaction, SEBI is clearly undergoing a leadership crisis.

If the majority of the staff feels mistreated or demoralized, the damage to the organization’s morale and, by extension, India’s capital markets, could be significant.

Here are all the controversies that Sebi Chairperson Madhabi Puri Buch is currently facing in a nutshell.

1) SEBI Review on Agenda, Parliamentary Watchdog Likely to Summon Madhabi Buch

In the most recent development, the Public Accounts Committee (PAC), the parliamentary body responsible for overseeing government spending, has decided to include a performance review of the Securities and Exchange Board of India (SEBI) in its agenda for the year.

This review places SEBI Chairperson Madhabi Puri Buch at the center of attention following allegations made against her by US-based Hindenburg Research.

The PAC, headed by senior Congress leader K C Venugopal, notified its agenda earlier this week and is expected to summon Buch during the review process.

This move is seen as an unusual step, as the PAC has included a suo motu subject—performance review of regulatory bodies established by an Act of Parliament—for the first time in recent memory.

Allegations and Response

The review comes amid increasing demands from the Opposition for a parliamentary probe into the Hindenburg Research allegations.

The report alleges that both Madhabi Buch and her husband, Dhaval Buch, had stakes in obscure offshore entities involved in the Adani Group’s alleged money siphoning scandal.

In response, Madhabi and Dhaval Buch issued a joint statement clarifying their position. They stated that the investment referenced in the Hindenburg report was made in 2015, at a time when both were private citizens living in Singapore, and two years before Madhabi Buch joined SEBI as a Whole Time Member in 2017.

The couple emphasized that SEBI has strong institutional mechanisms in place for disclosure and recusal, following a strict code of conduct.

“All disclosures and recusals have been diligently followed, including disclosures of all securities held or subsequently transferred,” the statement clarified.

Buch was appointed SEBI Chairperson in March 2022.

The Adani Group, which was central to Hindenburg’s allegations, has categorically denied the claims, calling them “malicious, mischievous, and manipulative.”

In a statement, the group reiterated that it has no commercial relationship with the individuals or entities named in the report and reaffirmed its commitment to transparency and compliance with all regulatory requirements.

Political Ramifications

The Congress party, leading the charge against SEBI, held nationwide protests last month and demanded the immediate removal of Buch from her position as SEBI Chairperson.

These protests have amplified pressure on the PAC to address the issue with urgency.

PAC’s Unusual Move

The PAC, which typically focuses on government revenue and expenditure, took the rare step of expanding its scope to include a review of regulatory bodies.

This move came during its last meeting on August 29, where several members suggested taking up new subjects.

In response, Venugopal agreed to add the review of SEBI’s performance, along with an additional review on “levy and regulation of fees, tariffs, and user charges on public infrastructure and utilities,” according to the committee’s notification.

With a 22-member panel composed of MPs from both the Lok Sabha and Rajya Sabha, the PAC includes prominent leaders such as Ravi Shankar Prasad, Anurag Thakur, and Sudhanshu Trivedi (BJP), alongside Congress members T R Baalu, Shaktisinh Gohil, and Jai Parkash.

The inclusion of members from various political parties adds weight to the committee’s decisions, making its review of SEBI even more significant.

Upcoming Meetings and Focus

The PAC is expected to meet two or three times in September, with the SEBI review potentially taking place during this period.

Its next meeting is scheduled for September 10, with the agenda focusing on a briefing related to the National Rural Drinking Water Programme (Jal Jeevan Mission), based on a C&AG report.

Given the urgency surrounding the SEBI review and the political firestorm it has ignited, the PAC is likely to prioritize the matter in its forthcoming sessions.

The decision to examine regulatory bodies has been described by insiders as “rare,” marking a shift in the PAC’s usual scope of work.

Did Madhabi Puri Buch Do Moonlighting During Her ICICI Bank Tenure? 

In a further twist to the growing controversy surrounding SEBI Chairperson Madhabi Puri Buch, fresh allegations have surfaced, casting a shadow on her tenure at ICICI Bank and raising concerns about her role as India’s top market regulator.

The Indian National Congress (INC) has spearheaded the attack, calling for urgent clarification from Buch and the government while also demanding her resignation in light of these claims.

The INC cited a news article suggesting that Buch was employed at Greater Pacific Capital, a private equity firm, during her tenure at ICICI Bank from 2011 to 2013.

This firm has a notable connection, with Shaurya Doval, the son of National Security Advisor Ajit Doval, being a key member of its leadership team.

Gaurav Chakravarty, head of the Professionals’ Congress, argued that Buch’s alleged dual employment raises serious questions about her independence and objectivity in her current role at SEBI.

Conflict of Interest Allegations

Chakravarty’s claims didn’t stop there.

He referred to numerous internal documents shared by industry insiders, alleging that Buch was in a conflict of interest position while at ICICI Bank, as she was eligible to receive income from ICICI stock, regulated by SEBI.

The INC demanded to know why ICICI Bank responded to this charge while Buch herself has remained silent.

They drew a comparison to the case of Chanda Kochhar, the former ICICI Bank CEO, who faced similar allegations but was subjected to an independent inquiry, with no intervention from ICICI Bank in her defense.

Chakravarty also highlighted a whistleblower platform that has been gathering evidence anonymously, suggesting that more individuals in the financial industry are willing to come forward with further information.

“Cabinet ministers and BJP MPs came to Ms. Buch’s rescue when the allegations were against her and her family,” Chakravarty said, questioning why such support was being offered.

Toxic Work Culture at SEBI

Adding to Buch’s woes, fresh reports have emerged of a toxic work culture at SEBI under her leadership.

SEBI officials lodged a formal complaint to the Ministry of Finance, outlining the deteriorating work environment at the regulatory body. The complaint, dated August 6, described a culture of public humiliation, unrealistic targets, and harsh language from the top management.

Titled “Grievances of SEBI Officers – A Call for Respect,” the letter accused the SEBI leadership of micromanaging, using unprofessional language, and monitoring staff excessively, which has negatively impacted their mental health and work-life balance.

“Shouting, scolding, and public humiliation have become the norm in meetings,” the letter stated, adding that there is “no defence from the senior management,” leading to a climate of fear and mistrust among employees.

According to the letter, this oppressive management style has been in place for the last 2-3 years, fostering an environment where many employees, even those in senior positions, are too afraid to express their concerns due to the “vindictive nature” of those in power.

The letter also criticized the leadership for failing to adopt modern management and motivational methods, despite SEBI’s efforts to embrace advanced technology to improve work efficiency.

The officials argued that while SEBI is modernizing its systems, it is neglecting to modernize its approach to leadership and employee engagement.

“Employees are not robots with a knob that one can turn and increase the output,” the letter stressed, urging SEBI’s management to overhaul its regressive policies.

SEBI’s Response

In response to the complaint, SEBI issued a statement acknowledging the issues raised. “In respect of the work environment, the format of review meetings has been changed. Hence, issues (with regard to) meetings stand addressed,” the regulatory body said.

However, this response has done little to quell concerns, as many believe the core issues—workplace harassment and unrealistic expectations—remain unaddressed.

Growing Political Pressure

The fresh set of allegations against Madhabi Puri Buch has further inflamed an already tense situation.

The INC’s calls for her resignation have been echoed by financial experts and industry professionals, who question whether Buch can continue to function objectively in her role given the multiple conflicts of interest and ethical concerns surrounding her past and present conduct.

Buch’s silence on the moonlighting allegations and the toxic work culture at SEBI has only fueled skepticism about her leadership. As the pressure mounts, it remains to be seen whether she will step down or address the growing list of accusations head-on.

The Last Bit, Madhabi Puri Buch’s tenure as SEBI chairperson has been marked by growing scrutiny and controversy.

Whether it’s her conflict of interest with ICICI Bank, lack of transparency, or the internal rebellion brewing within SEBI, the writing on the wall is clear: this is no longer about personal misconduct but about the office she occupies.

As the leader of India’s capital market regulator, she must be held to the highest standards of integrity, accountability, and leadership.

The current situation calls for her to step down—not only for the sake of restoring public trust in SEBI but also to ensure that the credibility of the institution she leads remains intact.

It’s time to take a call, Ms. Buch. Public service requires more than just following rules—it demands upholding the values of trust, transparency, and fairness that your office represents.