The Securities and Exchange Board of India (SEBI) is contemplating modifications to the “skin in the game” regulation that applies to employees of Asset Management Companies (AMCs).

Currently, this rule mandates that key figures, including the CEO, CIO, and fund managers, must allocate 20% of their annual salary and benefits into the funds they oversee, accompanied by a three-year lock-in period.

However, the new proposal introduces a more nuanced, tiered investment structure based on salary brackets. For employees earning less than Rs 25 lakh, there would be no compulsory investment. Those with a cost to company (CTC) between Rs 25 lakh and Rs 50 lakh would be required to invest 10%, while employees earning between Rs 50 lakh and Rs 1 crore would need to invest 14%. For those with earnings exceeding Rs 1 crore, the investment requirement would rise to 18%.

Additionally, the proposal aims to ease the investment obligations for non-investment personnel, such as Chief Operating Officers and sales leaders, allowing for greater flexibility that reflects the specific roles and responsibilities of each employee.

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