Forward Markets Commission (FMC) has also made it compulsory for the commodity exchanges to set up at least eight committees to assist the Board.
The revised guidelines, which are made effective from June 11, are issued to align with the SEBI norms. The exchanges are given one month time to make necessary changes in the bylaws.
"Since the commodity exchanges are Financial Market Infrastructure Institutions having an important regulatory role, there is a need to strengthen their corporate governance framework," FMC said in the revised guidelines.
FMC, which revised shareholding norms for national bourses on May 6, 2014, felt that there "is also a need to align the 'Norms on the Constitution of the Board of Directors, nomination of independent directors and appointment of Chief Executives at the Nationwide Commodity Exchanges' with the revised shareholding norms."
As per the fresh norms, the exchange should constitute a selection committee for hiring Managing Director. The committee would comprise of five persons -- two independent directors, two shareholder directors and one independent external person.
Further, the exchanges should ensure that one independent director will be part of the selection committee and the meetings of such committee at all times, it said.
"The person to be appointed as Managing Director/Chief Executive of the Exchange should satisfy the criteria of fit and proper person," it added.
The Board has also been given responsibility of devising a mechanism if a Managing Director quits in between.
As far as Board directors are concerned, the revised norms has laid down specified "code of conduct" for every director and "code of ethics" for independent directors and management personnel for setting up a fair and transparent marketplace. However, the FMC has maintained the strength and composition of the Board as per the Company's law.
The directors are mandated to follow the "code of conduct" in matters related to Board meetings and minutes, strategic planning and regulatory compliances.

To ensure effective oversight of the functioning of commodity exchanges, FMC said the exchanges are required to set up a minimum number of committees.


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