SEBI--Research Analyst and Investment Advisor

Balancing Innovation and Oversight : A Critical Review of SEBI's New Regulatory Framework for Research Analysts and Investment Advisers

CS. Raksha Sankhlecha

The Securities and Exchange Board of India (SEBI) has introduced significant regulatory reforms aimed at modernizing the financial advisory landscape. While these changes promote inclusivity and technological transparency, they also raise concerns about professional integrity, investor protection, and AI governance. This article provides a critical analysis of SEBI's amendments, highlighting both opportunities and challenges as India navigates a rapidly evolving financial ecosystem.

1. Introduction

The Securities and Exchange Board of India (SEBI) has undertaken a significant regulatory shift with the introduction of the Investment Advisers (Second Amendment) Regulations 2024 and Research Analysts (Third Amendment) Regulations 2024. These amendments seek to modernize compliance frameworks, expand professional access, and address evolving technological trends in financial advisory services. While the changes promise greater inclusivity and flexibility, they also raise concerns regarding professional integrity, investor protection, and the evolving role of artificial intelligence (AI) in financial markets.

This article critically examines the latest regulatory reforms, exploring their implications for market efficiency, ethical standards, and alignment with global best practices.

2. Key Transformations and Their Impact

(i) Expanding the Definition of Research Services

SEBI has broadened the scope of research services available to Research Analysts (RAS), incorporating elements such as: