SEBI shortlists six consulting firms for IT and risk overhaul

08 July 2020 3 min. read

Seeking consulting support to develop a robust IT and risk management infrastructure, the Securities and Exchange Board of India (SEBI) is now choosing between EY, KPMG, PwC, RSM Astute Consulting, BDO and ANB Solutions to be its partner of choice.

The role is a comprehensive one. To begin with, the selected consulting firm will conduct a risk assessment at SEBI, and examine potential pitfalls in digital implementation. This involves pointing out anticipated threats and the magnitude of damage. The initial risk assessment needs to be followed up and maintained via an annual evaluation.

Once the weak spots are identified, the consulting firm will suggest measures to keep these threats in check, as well as devise contingency plans for damage control. The ultimate goal is to have a set of carefully prepared policy documents and standard operating procedures (SOPs) in place that will minimise risk to the greatest possible extent.

SEBI announced its plans back in February, pointing out that a clear and robust framework would improve efficiency and cut costs for the organisation. “SEBI expects to prepare and implement a suitable governance structure and a comprehensive policy that is custom-made to suit to the needs of the business and advising staff of their obligations to ensure ongoing compliance,” read a statement.

SEBI shortlists six consulting firms for IT and risk overhaul

The selection process has now progressed considerably, and some big names have made the final shortlist. Three of the Big Four – EYKPMG and PwC – are all in consideration. All three have significant experience offering compliance solutions to businesses across India, putting them in strong contention for the partnership with SEBI.

The rest of the shortlist is also strong in terms of qualifications, with RSM Astute Consulting, BDO and ANB Solutions all enjoying a strong track record in the risk management field. The selected firm will have its work cut out, particularly as SEBI navigates an especially challenging period under Covid-19 circumstances.

To mitigate the economic impact of the crisis and keep businesses up and running, the regulatory body has been seeking the balance between loosening restrictions to some extent and preventing a spike in fraudulent activity driven by the crisis. It also remains to be seen to what extent SEBI’s operations are affected by a change in leadership that is due to come into effect next month. Risk management is of the essence in such a scenario.

SEBI is not alone in shoring up its risk profile under the challenging circumstances. India’s largest lender the State Bank of India recently put out a request for proposal (RFP) for a project that will strengthen the bank’s risk management practices.

Developments suggest that consultancies in India specialised in risk management are expected to be in high demand as the topic emerges as a top priority during the crisis and after.