{"id":217101,"date":"2022-12-03T21:43:54","date_gmt":"2022-12-03T16:13:54","guid":{"rendered":"https:\/\/blog.forumias.com\/?page_id=217101"},"modified":"2022-12-03T21:43:54","modified_gmt":"2022-12-03T16:13:54","slug":"answered-market-infrastructure-institutions-miis-suffer-from-the-conflicting-nature-of-different-roles-elaborate","status":"publish","type":"page","link":"https:\/\/forumias.com\/blog\/answered-market-infrastructure-institutions-miis-suffer-from-the-conflicting-nature-of-different-roles-elaborate\/","title":{"rendered":"[Answered] Market Infrastructure Institutions (MIIs) suffer from the conflicting nature of different roles. Elaborate."},"content":{"rendered":"<table>\n<tbody>\n<tr>\n<td width=\"616\"><strong>Introduction:\u00a0<\/strong>Contextual introduction.<br \/>\n<strong>Body:\u00a0<\/strong>Explain in detail why Market Infrastructure Institutions (MIIs) suffer from the conflicting nature of different roles.<\/p>\n<p><strong>Conclusion<\/strong>: Write a way forward.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><strong>Stock exchanges, depositories and clearing houses<\/strong> are all Market Infrastructure Institutions (MIIs) and constitute a key part of the nation\u2019s vital economic infrastructure.\u00a0 Market\u00a0\u00a0 Infrastructure\u00a0\u00a0 Institutions\u00a0\u00a0 (MIIs)\u00a0\u00a0 are\u00a0\u00a0 unique\u00a0\u00a0 institutions providing\u00a0\u00a0 vital infrastructure of trading, settlement and record keeping. They are vested with regulatory responsibilities, while pursuing commercial interests like other profit- oriented entities<\/p>\n<p><strong>Conflicting nature of different roles:<\/strong><\/p>\n<ul>\n<li>MIIs also perform a unique <strong>dual role.<\/strong> On the one hand, MIIs are <strong>corporate entities<\/strong> wherein attention to bottom line of their business is a natural outcome. On the other hand, as a first line regulator, MIIs carry<strong> out the key regulatory and public utility functions<\/strong>.<\/li>\n<li>Given their\u00a0 vital\u00a0 role\u00a0 in\u00a0 the\u00a0 capital\u00a0 market ecosystem,\u00a0 they\u00a0 cannot\u00a0 engage\u00a0 themselves exclusively in\u00a0 pursuit\u00a0 of\u00a0 profits\u00a0 which \u00a0results in <strong>dilution of their focus on the regulatory role.<\/strong><\/li>\n<li>At the same time, they have to be viable institutions generating sufficient surpluses to effectively discharge their role of public utility with an eye on robust investor protection. The business model of an MII is thus inherently conflicting.<\/li>\n<li><strong>Misgovernance<\/strong> is another challenge with MIIs.<\/li>\n<li>Every key management person\u2019s appointment decision of exchanges is <strong>controlled by the regulator (government).<\/strong><\/li>\n<li>Personnel at MIIs have begun to behave like civil servants. E.g. not taking decisions and pushing every small question up through the hierarchy and get multiple signatures. This has <strong>hampered operational capability. <\/strong><\/li>\n<li>Exchanges and MIIs in India can no longer be described as autonomous organisations as they <strong>lack in rapidly taking decisions.<\/strong><\/li>\n<\/ul>\n<p>Well-functioning MIIs, constitute <strong>\u201cthe nucleus of the capital allocation system\u201d,<\/strong> are indispensable for economic growth and have a net positive effect on society like any other infrastructure institution.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Introduction:\u00a0Contextual introduction. Body:\u00a0Explain in detail why Market Infrastructure Institutions (MIIs) suffer from the conflicting nature of different roles. Conclusion: Write a way forward. Stock exchanges, depositories and clearing houses are all Market Infrastructure Institutions (MIIs) and constitute a key part of the nation\u2019s vital economic infrastructure.\u00a0 Market\u00a0\u00a0 Infrastructure\u00a0\u00a0 Institutions\u00a0\u00a0 (MIIs)\u00a0\u00a0 are\u00a0\u00a0 unique\u00a0\u00a0 institutions providing\u00a0\u00a0 vital&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/answered-market-infrastructure-institutions-miis-suffer-from-the-conflicting-nature-of-different-roles-elaborate\/\">Continue reading <span class=\"screen-reader-text\">[Answered] Market Infrastructure Institutions (MIIs) suffer from the conflicting nature of different roles. Elaborate.<\/span><\/a><\/p>\n","protected":false},"author":10320,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"class_list":["post-217101","page","type-page","status-publish","hentry","entry"],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/pages\/217101","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10320"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=217101"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/pages\/217101\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=217101"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}