CORPORATE GOVERNANCE IN
PAKISTAN
ICAP constituted a Committee comprising its elected past Presidents, Presidents of the three Stock Exchanges in Pakistan, President of Institute of Cost and Management Accountants of Pakistan and a nominee of the Securities and Exchange Commission of Pakistan (SECP). The Committee's Terms of Reference are set out in the exhibit. A sub-committee was formed to undertake the task of formulating recommendations for the Code.
THE NEED OF CORPORATE GOVERNANCE
While the world was witnessed a major stride forward and a growing interest for good corporate governance, the need to have a Code responsive to our objective circumstances is being increasingly felt as an imperative which is demonstrated by all concerned with the corporate sector including the investors, the financial services community, regulators and the accounting profession. Therefore, the need to have a framework of good corporate governance has never been so impelling as it is today. It is, therefore, pertinent to briefly highlight what is contemplated in the context of good corporate governance and what is sought to be achieved as the primary objectives of the endeavour.
OBJECTIVES OF CORPORATE GOVERNANCE
The corporate governance framework aims to establish a system whereby a company is enabled to be directed and controlled by its directors having due regard to compliance with the best practices enunciated by the Code for carrying out the conduct and affairs of a company. In the context of Pakistan, the need for good corporate governance assumes a more significant dimension given the corporate culture and infact the overwhelming number of companies which are closely held.
In particular, therefore, the recommendation of the Code to restruc ...