Elections for Pakistan Stock Exchange’s new board of directors will be held on April 19, the sitting 14-member board decided in a meeting on Monday.
Investors are relieved as the decision, reached in consensus, staved off a battle that could have dragged the matter to the courts, a move which would have caused further damage to the market which is already reeling under pressure during the past year or so.
The issue took an ugly turn when SECP’s deadline, for holding the elections, passed on February 28.
The tussle between Securities and Exchange Commission of Pakistan and Pakistan Stock Exchange finally ended, after the latter agreed to reconstitute its board and hold fresh elections.
The stockbrokers and independent directors were adamant that elections were not due until Feb 2019 – the expiry of the term of the current board.
Dr. Miftah Ismail then ordered the bourse management to resolve the issues linked to the election of its directors in conjunction with SECP as per regulatory requirements.
Ismail said that the government was endeavoring to make Pakistan’s financial and capital market among the most competitive in the world.
The new board, to be elected on April 19, will enable representation of minority shareholders who subscribed to 20 percent shares issued under the Initial Public Offering; disbanding the concept of SECP-nominated directors and offering one seat to a female director as required under the Companies Act, 2017.
According to an English Daily, in the PSX board meeting held on Monday, it was decided that the number of directors of the new board will be 14.
The seats will be equally divided between the shareholder directors and independent directors. The Chinese majority 40 percent equity holders; the local broker directors also with a 40 percent stake and the public’s 20 percent minority will contest for the seven allocated seats on the board.
For the seven independent directors, PSX will pass on recommendations of 14 nominees to the SECP, which will make the final selection.
PSX Managing Director Richard Morin, by virtue of his post, will sit on the board as the 15th director.