Draft rules issued to appoint CEOs at public firms

Updated August 25, 2019

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The Securities and Exchange Commission of Pakistan (SECP) issued draft regulations governing the appointment of chief executives at the public sector companies. — Reuters/File
The Securities and Exchange Commission of Pakistan (SECP) issued draft regulations governing the appointment of chief executives at the public sector companies. — Reuters/File

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) issued draft regulations governing the appointment of chief executives at the public sector companies.

The draft has been published on the SECP website to gather feedback and comments from stakeholders.

The draft proposes that the application for the position of CEO shall be made through a specific form attached along with the draft regulations.

The procedure includes establishment of a ‘Selection Committee’ to short-list candidates, while the composition of selection committee will vary with the nature of business of the company, and will comprise of the minister-in-charge of the administrative division under which the public sector company falls as per Rules of Business, 1973.

Moreover, if the charge of ministry/division is held by the prime minister, the selection committee will be led by a minister-in-charge/minister of state/adviser/special assistant to the PM, as nominated by the premier.

Furthermore, the regulator has also explained the composition of selection committees in the published draft.

The regulations point out that the CEO, once selected, shall be appointed on contract basis for a fixed tenure but not exceeding three years subject to the provisions of relevant law.

In case, an officer working for the government or armed forces is selected for the position, he/she would have to seek premature retirement or resign from his/her existing position.

The regulations also propose that any candidate applying for the position of the CEO should have at least ten years of experience in governance or business administration or public administration or finance or commerce or marketing or any other field commensurate to the job in significant organisations with a commercial orientation.

The comments and suggestions related to the regulations will be taken up by the SECP for consideration in the first week of September.

Published in Dawn, August 25th, 2019