July 26, 2022
Summary of the notification issued by SEBI on 25/07/2022
Obligations of a listed social enterprise under LODR Regulations
A new Chapter, prescribing the disclosures and intimations to be filed with the exchanges, is introduced to govern the following entities:
– ‘For Profit Social Enterprise’ whose designated securities are listed on the applicable segment of the Stock Exchange(s) (SEs)
– a Not for Profit Organization that is registered on the Social Stock Exchange(s) (SSEs);
Key highlights of the amendment are:
1. Definition of the Designated Securities is amended to include Zero Coupon Zero Principal instruments.
2. A For Profit Social Enterprise whose designated securities are listed on the SEs shall comply with the disclosure requirements as applicable to issuers whose specified securities are listed on the Main Board or the SME Exchange or the Innovators Growth Platform, as the case may be.
3. A listed Not for Profit Organization is required to make annual disclosures to the SSEs on matters specified by the Board, within 60 days from the end of the financial year or within such period as may be specified by the Board.
4. Listed Social Enterprise shall-
a. frame a policy for determination of materiality and shall disclose the same to the SEs/SSEs.b. disclose any event that may have a material impact on the planned achievement of outputs or outcomes, at the earliest but not later than seven days or within such period as may be specified by the Board, from the occurrence of the event and the disclosure shall comprise details of the event including the potential impact of the event and the steps taken by the Social Enterprise to address the same.c. Submit an ‘Annual Impact Report’ duly audited by a Social Auditor of a Social Audit Firm to the SE/SSE.
5. A listed Not for Profit Organization shall submit a quarterly report to the SSE a statement of utilisation of funds, till such time the issue proceeds have been fully utilised or the purpose for which they were raised, has been achieved.
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