Pakistan forms institute of corporate governance

[Mahtab]

AOA Press Release IFC and Pakistan’s Securities and Exchange

Commission to Strengthen Corporate Governance Reforms in Pakistan

Islamabad and Cairo, The Securities and Exchange Commission of

Pakistan and the International Finance Corporation, the

private sector arm of the World Bank Group, today signed a Memorandum

of Understanding today in Islamabad to promote and support corporate

governance reforms in Pakistan. Dr. Tariq Hassan, Chairman of the

Securities and Exchange Commission of Pakistan, said, “This is the

first project to tackle corporate governance reforms on a

comprehensive basis in our country. The project sets out to strengthen

current practices of financial institutions and corporations. It will

also advise the public sector on how to improve upon the legal and

regulatory framework for corporate governance and will build

institutional capacity for developing corporate governance curricula

and training.” He added that the project would help the Pakistan

Institute of Corporate Governance become a leading provider of

knowledge and awareness related to corporate governance practices in

the country. “What makes this joint initiative so unique,” added

Michael Essex, IFC’s Acting Director for the Middle East and North

Africa, “is that it will attempt to turn a short-term technical

assistance project into a sustainable structure that can provide

quality corporate governance services. It will do so by working both

with and through the recently established Pakistan Institute of

Corporate Governance.” The initiative announced today, the Pakistan

Corporate Governance Project, is fully funded by IFC and proposes to

support the Pakistan Institute of Corporate Governance in five key

areas

Setting up training and certificate programs on corporate governance for company directors, managers, and secretaries;

Building capacity for research and development to conduct surveys, issue publications, and produce best practice manuals;

Developing and providing consulting and advisory services on corporate governance to Pakistan’s banks and corporations;

Raising awareness of corporate governance practices via conferences, seminars, and roundtables;

Providing policy advice to the government on legal and regulatory reforms relating to corporate governance.

“This joint initiative is a business project, with clearly defined

goals, objectives, and activities that are to be laid out in a

detailed business plan” said Jesper Kjaer, General Manager of IFC’s

Private Enterprise Partnership for the Middle East and North Africa

(PEP-MENA). He added, “All future services are to be based on

internationally recognized best practices, yet tailored to Pakistan’s

emerging market environment, focusing on key corporate governance

issues that are relevant to family-owned structures. These include

building professional boards, implementing internal control systems,

facilitating succession planning, and ensuring information disclosure

for minority, outside shareholders." PEP-MENA is IFC’s technical

assistance facility that supports private

sector development in the Middle East and North Africa. PEP-MENA

focuses on improving the business enabling and regulatory environment

in the region; strengthening the financial sector; promoting the

growth of small and medium enterprises and their support services,

such as business organizations and consulting firms; helping

restructure and privatize state-owned enterprises; and developing

viable private sector and public-private partnership projects,

especially in infrastructure. The mission of IFC (www.ifc.org) is to

promote sustainable private sector investment in developing countries,

helping to reduce poverty and improve people’s lives. IFC finances

private sector investments in the developing world, mobilizes capital

in the international financial markets, helps clients improve social

and environmental sustainability, and provides technical assistance

and advice to governments and businesses. From its founding in 1956

through FY04, IFC has committed more than $44 billion of its own funds

and arranged $23 billion in syndications for 3,143 companies in 140

developing countries. IFC’s worldwide committed portfolio as of FY04

was $17.9 billion for its own account and $5.5 billion held for

participants in loan syndications. The Securities and Exchange

Commission of Pakistan (www.secp.gov.pk) is the apex regulator of the

corporate sector, capital market, and nonbank financial sector in

Pakistan. The Commission introduced the Code of Corporate Governance

in Pakistan through the listing regulations of the stock exchanges and

has been actively involved in promoting awareness and implementation

of good corporate governance. It played a lead role in establishing a

dedicated institute on corporate governance, the Pakistan Institute of

Corporate Governance, as a public-private partnership that provides an

enabling environment for effective implementation of the Code of

Corporate Governance. The Pakistan Institute of Corporate Governance

is a not-for-profit company set up under Section 42 of the Companies

Ordinance, 1984. It aims to undertake activities that help achieve

good corporate governance in Pakistan and to create an enabling

environment for effective implementation of the Code of Corporate

Governance. The Institute’s initial sponsors comprise a balanced

representation of all major stakeholders from the country’s public and

private sectors. The founding members have subscribed to the

Institute’s Memorandum of Association.

Regards

Mahtab