Sebi has proposed a new advertising framework called the Common Advertisement Code (CAC) that would standardise how financial intermediaries in India promote themselves, while introducing stricter limits on celebrity endorsements in the securities market.
What the proposal says
The Securities and Exchange Board of India (Sebi) has suggested replacing the current fragmented advertising rules with a single, uniform code applicable to stock brokers, mutual funds, investment advisers, portfolio managers, research analysts, depository participants, and other regulated entities.
The goal is to create consistency in financial advertising and improve investor protection, especially as retail participation in markets continues to grow.
Celebrities allowed — but with restrictions
Sebi noted that celebrity endorsements are already widely used across industries and cannot realistically be fully banned in financial services. Under the proposal:
Celebrities can endorse a financial company’s brand or entity name
Such endorsements must follow prescribed conditions and include proper disclaimers
However, celebrities cannot promote specific investment products or services
Sebi clarified that while brand endorsements suggest a general association with a firm, promoting specific products could unfairly influence investor decisions by creating misleading expectations about returns or suitability.
Why Sebi is doing this
With more retail investors entering the market through digital platforms and influencer-driven content, Sebi said advertising practices need tighter oversight.
The regulator aims to prevent issues like:
exaggerated return claims
selective performance showcasing
misleading projections
weak risk disclosures
Industry response
Experts say the move is timely. According to market professionals, a unified code could push financial firms toward more transparent and balanced communication, with greater focus on:
risk disclosures
fees and conflicts of interest
product suitability
past performance clarity
Overall intent
Sebi’s proposal tries to strike a balance between modern marketing practices and investor safety—allowing brand visibility through celebrities, while restricting anything that could directly influence investment decisions.
