Mumbai | In a significant move to enhance corporate governance, transparency, and investor protection, SBI Funds Management Limited, the investment manager of SBI Mutual Fund, has adopted a Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information (UPSI).
The new framework has been introduced in accordance with Regulation 8 of the Securities and Exchange Board of India (SEBI) (Prohibition of Insider Trading) Regulations, 2015, reinforcing the company’s commitment to ethical business practices and regulatory compliance.
The adoption of the Code aims to ensure that all investors—whether retail or institutional—receive equal, timely, and transparent access to material information that could influence investment decisions.
What Is Unpublished Price Sensitive Information (UPSI)?
Unpublished Price Sensitive Information (UPSI) refers to any material information about a company that is not publicly available but could significantly affect the price of its securities once disclosed.
Examples of UPSI may include:
- Financial Results
- Major Business Transactions
- Mergers and Acquisitions
- Strategic Investments
- Management Changes
- Corporate Restructuring
- Significant Business Developments
The fair handling of such information is essential to prevent insider trading and maintain confidence in the financial markets.
Purpose of the New Disclosure Code
The newly adopted Code has been designed to ensure:
- Prompt disclosure of all price-sensitive information.
- Equal dissemination of material information to every stakeholder.
- Prevention of selective disclosure to specific individuals or institutions.
- Higher standards of transparency in communications with investors.
- Compliance with SEBI regulations governing insider trading.
The initiative is expected to strengthen investor confidence by ensuring that important corporate information reaches the market fairly and simultaneously.
Key Features of the Fair Disclosure Code
Chief Investor Relations Officer (CIRO)
Under the new Code, the company’s Compliance Officer will serve as the Chief Investor Relations Officer (CIRO).
The CIRO will be responsible for overseeing the disclosure of Unpublished Price Sensitive Information and ensuring compliance with applicable regulatory requirements.
Prompt Public Disclosure
Whenever credible price-sensitive information becomes available, SBI Funds Management will promptly disclose it through:
- Recognized Stock Exchanges
- The Company’s Official Website
This approach ensures that all investors receive important information at the same time.
Need-to-Know Principle
The Code specifies that UPSI will be shared only on a “Need-to-Know” basis, ensuring that sensitive information is disclosed only when necessary for legitimate business purposes and with appropriate confidentiality safeguards.
Legitimate Purpose Framework
The Code establishes clear guidelines for sharing confidential information for:
- Business Transactions
- Legal Requirements
- Regulatory Compliance
- Professional Advisory Services
Such disclosures must be supported by valid business or legal reasons while maintaining strict confidentiality.
Structured Digital Database
To strengthen compliance and improve audit readiness, SBI Funds Management will maintain a Structured Digital Database containing records of UPSI sharing.
The database will include audit trails, enabling effective monitoring and regulatory verification whenever required.
Managing Analyst Meetings and Market Rumors
The Fair Disclosure Code also outlines procedures for handling:
- Analyst and Investor Meetings
- Institutional Investor Interactions
- Media Communications
- Market Rumors
- Requests for Material Information
These measures are intended to prevent selective communication and ensure that market-sensitive information is disclosed in a transparent and regulated manner.
Strengthening Corporate Governance
The adoption of the Code reflects SBI Funds Management’s continued commitment to:
- Corporate Governance
- Ethical Business Practices
- Regulatory Compliance
- Investor Protection
- Market Integrity
- Transparent Communication
By aligning its disclosure practices with SEBI’s Insider Trading Regulations, the company aims to maintain the highest standards of accountability in its operations.
Benefits for Investors
The implementation of the Fair Disclosure Code provides several important benefits for investors, including:
- Equal access to material information
- Greater transparency in corporate disclosures
- Reduced risk of insider trading
- Improved investor confidence
- Enhanced market fairness
- Better regulatory compliance
These measures contribute to a more transparent investment environment where all market participants receive information on an equal basis.
Code Available for Public Access
SBI Funds Management has made the newly adopted Code of Practices and Procedures for Fair Disclosure of UPSI available on its official website and has formally informed the relevant stock exchanges, ensuring full regulatory compliance.
A Positive Step for India’s Mutual Fund Industry
The adoption of the Fair Disclosure Code by SBI Funds Management Limited represents another important milestone in strengthening governance standards within India’s rapidly growing mutual fund industry.
By promoting fair disclosure, ethical conduct, and transparent communication, the initiative reinforces the company’s commitment to protecting investor interests while supporting the integrity and credibility of India’s capital markets.
