Islamabad: In recent past it was observed that meetings of boards of directors of listed companies were being extensively held abroad, even at places that were unrelated to concerned companies’ business activity or geographical location of their shareholders.
This undesirable practice on part of directors that owe a fiduciary duty towards the company was resulting in undue costs for the listed companies as well as their minority shareholders with no benefit thereof.
In order to check such detrimental trend the Commission has, while taking serious note of this practice and in exercise of its powers, linked the number of board meetings that a listed company may hold abroad with the proportionate participation of foreign directors on its board/equity.
Accordingly, it has been directed that all listed companies incorporated in Pakistan having foreign equity participation, if required, can hold board meetings abroad, in any one financial year, as per thresholds prescribed below:
i. Companies having more than 50% foreign shareholding
Maximum 4 board meetings
ii. Companies having more than 40% but up to 50% foreign shareholding
Maximum 3 board meetings
iii. Companies having more than 30% but up to 40% foreign shareholding
Maximum 2 board meeting
iv. Companies having nil or up to 30 % foreign shareholding
Maximum 1board meeting
For more information, contact:
Shakil Ahmad Chaudhary
Head, Internal and External Communication
Securities and Exchange Commission of Pakistan (SECP)
NIC Building, 63 Jinnah Avenue, Islamabad
Tel: +9251 921 4005 or 921 4009 (Ext. 378)
Fax: +9251 920 6459
Cell: +92302 855 2254