In a regulatory filing on August 9, Infosys said, “There were certain entries which were logged with a delay in the SDD. It was submitted by INFY that during FY2020-21 due to the ongoing Covid -19 pandemic, most of the workforce was working from their respective homes and not from the office premises. Therefore, it was logistically difficult to coordinate and maintain these records. While the information pertaining to UPSI during such period was available within INFY, it seems that updating of such information in the SDD system was delayed.”
However, Sebi said that it does not accept Infosys’s argument about delays in updating its structured digital database (SDD) in the financial year 2020-21.
SEBI letter to Infosys
In a letter to the company, the stock market regulator has advised the firm to be careful on the matter. A review of the SDD should have been carried out on a periodic basis, which would have ensured that such information was logged properly. “The above violations have been viewed seriously by SEBI. Therefore, the Company Secretary was warned, and henceforth advised to be careful with respect to the maintenance of SDD,” the filing said.
What is SDD
The Structured Digital Database or SDD contains the names of persons or entities with whom Unpublished Price Sensitive Information (UPSI) is shared, and has to be mandatorily maintained under Sebi’s insider trading regulations. The concept emanates from the SEBI (Prohibition of Insider Trading) Regulations, 2015. It came into effect from April 1, 2019.
No financial impact of the letter, says Infosys
As part of good governance, Infosys said that it is now conducting internal due diligence on the completeness of SDD records. “There is no impact on the listed entity’s financial, operational or other activities as a result of the administrative warning letter,” the company said.