Karachi, March 03, 2016 (PPI-OT):The Securities and Exchange Commission of Pakistan (SECP) in collaboration with International Finance Corporation (IFC) and Centre for International Private Enterprise (CIPE) arranged roundtable conference in Karachi on Thursday, March 3, 2016.
The roundtable was conducted to create public awareness and to seek feedback from market participants about proposed Principles of Corporate Governance for Non Listed Companies pursuant to co-operation agreement between SECP, IFC and CIPE. The conference was attended by distinguished guests including representatives from industry, accounting and trade bodies, and academia. Mr. Ebrahim Sadaat was chairing the event.
Mr. Tahir Mahmood, Commissioner (Company Law Division), on this occasion, explained at length as to how proposed Principles of Corporate Governance for Non Listed Companies would be beneficial in improving corporate governance regime for Non Listed Companies. He also highlighted importance of self-regulatory organizations and informed the participants that Principles are voluntary in order to encourage market participants for better adoption.
While presenting brief introduction of Principles of Corporate Governance for Non Listed Companies, Mr. Mahmood was of the view that it is a landmark progress for improvement of corporate governance regime for Non Listed Companies. He elaborated that thirteen principles have been introduced wherein phase one contains seven principles and phase two contains six principles.
Phase one principles are generally applicable on all Non Listed Companies except small sized companies whereas phase two principles are applicable on large sized companies. He Acknowledged the efforts made by IFC and CIPE, for making peer review of the Principles of Corporate Governance for Non Listed Companies.
Mr. Mohsin Chaudhary from IFC and Mr. Hammad Siddiqui from CIPE made detailed deliberations in the conference highlighting international practices and benefits accrued through following corporate governance principles.
Roundtable concluded with agreement to strengthen the corporate governance regime for Non Listed Companies and recommendations on following priorities:
(a) Constitutive documents of Non Listed Companies and Companies Ordinance, 1984 are mandatorily applicable; however, Principles provide wider perspective for improving corporate governance regime of such companies.
(b) Improving the effectiveness of boards of directors through role of boards and committees constituted by the board of directors.
(c) Boards to establish effective internal control mechanisms in order to control business and operational risks.
(d) Financial reporting regime of Non Listed Companies be improved and effective redressal of issues be provided in annual reports;
(e) Shareholders meetings shall be forum for effective representation of all shareholders of Non Listed Companies and shareholders shall be encouraged to participate in the meetings.
SECP recognizing the fact that more than 60,000 Non Listed Companies in Pakistan and there is a dire need to improve corporate governance of these companies. Therefore, Principles of Corporate Governance for these companies are introduced for stakeholder consultation. It is expected that collaboration of SECP and IFC shall transform an effective corporate governance regime for Non Listed Companies in Pakistan. Joint collaboration of SECP, IFC and CIPE was highly appreciated by the participants of the conference. Feedback received from market participants would be taken care in the final draft of Principles by SECP.
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: +92-51-9214005 or +92-51-9214009 (Ext. 378)