Board knew of NSE chief’s misconduct but let her resign with glowing

When she resigned on December 2, 2016, the NSE board was chaired by former Finance Secretary Ashok Chawla and included former Sebi Executive Director Dharmishta Raval, former judge of the Supreme Court BN Srikrishna, former Secretary at the Ministry of Corporate Affairs Naved Masood, KPMG India’s former Deputy Chief Executive Dinesh Kanabar, Manipal Global Education Services Chairman Mohandas Pai, General Atlantic advisory director Abhay Havaldar, Azim Premji Investment CIO Prakash Parthasarathy, besides Ravi Narain, Vice Chairman, and Ramkrishna herself.

According to Sebi, even after knowing that Ramakrishna was dependent on the guidance of an “unknown person” while taking important decisions, the NSE board permitted her to “exit through resignation” and recorded the appreciation in the Board meeting held on December 2, 2016, of her “sterling contribution to the growth of organisation”. These observations came after the regulator heard NSE and Ramkrisna’s responses to the show cause notices sent in October 2019 and December 2019.

Kanabar, Pai and Masood joined the company’s Board in July 2016, five months before Ramkrishna resigned. Chawla became the Chairman of NSE in May 2016 after former LIC chief SB Mathur completed a three-year tenure as NSE Chairman.

Anand Subramanian, former ‘Group Operating Officer and Advisor to MD’, whose appointment created the controversy, joined NSE during Mathur’s tenure. This appointment by Ramkrishna was arbitrary and not in compliance with NSE’s policies. Further, she shared confidential information with an ‘unknown person’ and misled NSE that the unknown person was a ‘siddha-purusha’.

According to a NSE former director who was on the board when Ramkrishna stepped down, it was around August 2016 that SEBI communicated with the board, pointing out alleged transgressions involving Subramanian’s appointment and remunerations that were informed to the regulator by anonymous letters.

Following SEBI’s communication, in which it asked the board to investigate the issue, the board set up an inquiry committee headed by the chairperson of its audit committee Dinesh Kanabar. “We found there has been gross abuse of power by the CEO (Ramkrishna) in paying Subramanian high compensation for four years. The human resources department said matters pertaining to Subramanian’s compensation were approved by the CEO,” the former director said on condition of anonymity.

In October 2016, the board met and decided that Subramanian had to go. Subramanian’s departure, according to the former director, created a rift between Ramkrishna and the board.

Following the…