After the Forward Market Commission’s (FMC) latest directive on wider representation of shareholders on the Board of commodity derivative exchanges, the number of representatives from Financial Technologies (FTIL) on the board of Multi Commodity Exchange (MCX), a group company, may be capped at one member.
While classifying the shareholders in five broad categories, the FMC guided that the representation of the anchor investor on the board of an exchange should not be more than the proportion of their shareholding, which is capped at 26% at the end of the fifth year of the exchange’s operation.
This restriction is in addition to earlier guidelines that require at least 50% of the board of directors to be independent and four of them to be appointed by the commission it self.
Currently, there are nine members on the board of directors of MCX, including five FMC-nominated independent directors. Among other members, two non-executive directors — Jignesh Shah and Paras Ajmera — are considered to directly represent FTIL.