Demutualisation of Stock Exchanges

The basic objective of demutualisation of stock exchanges should be to do away with the involvement of brokers in the management of the exchanges and to convert the exchanges into business entities so that they are professionally managed. This basic objective can be achieved in the Indian context without getting into all the legal complications of first converting the exchanges into limited liability tax-paying entities and then separating their ownership from the trading rights of brokers. The necessary changes can be effected quickly and without any hassles by exercise of the powers that SEBI already enjoys to reconstitute the governing boards of the stock exchanges.