India's markets regulator, the Securities and Exchange Board of India (SEBI), has issued a framework that enables eligible unitholders to exercise board nomination rights in Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs). Eligible unitholders are those individuals or entities holding 10 per cent or more of the total outstanding units of a particular REIT or InvIT, either individually or in a collective capacity.SEBI's decision to introduce board nomination rights for unitholders in REITs and InvITs was approved during its board meeting on June 28. The move is aimed at enhancing governance and transparency within these investment vehicles.Under the framework, the manager of a REIT or InvIT is required to periodically assess whether eligible unitholders, who have exercised their board nomination rights, continue to meet the necessary unit ownership criteria. This review process must be completed within ten days from the end of each calendar month.Furthermore, the manager is obligated to submit a report to the trustee of the relevant REIT or InvIT regarding the unitholders who have exercised their nomination rights.One key aspect of this framework is that eligible unitholders now have the right, though not the obligation, to nominate an individual for appointment as a unitholder nominee director. This represents a significant development in terms of corporate governance within REITs and InvITs.The introduction of this framework by SEBI is seen as a positive step towards further professionalising and regulating India's REIT and InvIT markets, offering investors additional avenues for influence and oversight within these investment structures. It aligns with SEBI's commitment to creating a more transparent and accountable investment environment in the country's real estate and infrastructure sectors.