Stakeholder Perception on Financial Sector Legislative Reform Commission (FSLRC)

Bureau of Research on Industry & Economic Fundamental (BRIEF) undertook a study on Stakeholder Perception on Financial Sector Legislative Reforms Commission (FSLRC) in collaboration with Federation of India Chambers of Commerce and Industry (FICCI).The study was supported by Ministry of Finance.

The objective of the study carried out involved understanding the perception of FSLRC among various stakeholders within several sectors in the financial segment.

The Financial Sector Legislative Reforms Commission (FSLRC) was constituted by the Ministry of Finance, Government of India, in March, 2011 to review and rewrite the legal-institutional structure of the Indian financial sector and bring it in tune with current requirements. There are over 60 multiple Acts and rules\regulations in the financial sector which are outdated as compared to the modern financial landscape. Moreover, frequent amendments to these financial sector laws, without substantial changes to the basic foundations have only added to the confusion and complexity of the current situation. There have been a lot of unwanted and unintended consequences such as regulatory gaps, overlaps, inconsistencies and regulatory arbitrage, not to forget the loss of scale and scope resulting from such a type of fragmented regulatory architecture.

The study was conducted in order to understand how well the FSLRC report has been received by different sectors of the market, and predict the possible response once the changes suggested by it are rolled out. To this end the study involved gauging the market’s opinion of whether they feel the recommendations are implementable, how much time it will take to implement them, and possible roadblocks in the course of implementation. The study also looked into gathering suggestions and proposals from the stakeholders regarding the changes they would like to witness in the financial landscape of the country.

The approach that was followed consisted of two phases. The first phase entailed appraisal of the situation, study of the reports of the commission as well as the five working groups, preparation of the research tool (questionnaire) for primary research, and pilot testing of the survey. The questionnaire which was prepared for the primary data collection is a ‘Semi-Structured Questionnaire’ with a pre-conceived format, allowing the researcher to flexibly glean vital information.

The second phase of the study involved the survey. The survey was conducted in major cities of the country which include: Delhi NCR, Mumbai, Chennai, Bangalore, Hyderabad and Kolkata. The perception for the study was focused on senior and top management executives in the financial segment companies. The primary research was principally in the form of ‘Face-to-Face’ interviews.