Pakistan Stock Exchange (PSX) has finally put an end to months-long tussle with the Securities and Exchange Commission of Pakistan (SECP) – by announcing the election of unopposed seven directors on its board on Wednesday.
The seven elected directors were Zhiping Rong, QUE Bo, Yu Huali, Shahnawaz Mahmood, Ahmed Chinoy, Abid Ali Habib and Mohammad Ashraf Bawany.
The directors were elected on behalf of the PSX shareholders for a period of three years. The election was scheduled to be held at an extraordinary general meeting (EOGM) on April 19.
“Since the number of persons who have offered themselves for election is not more than the number of directors fixed by the board, the candidates shall be deemed to have been elected at the said EOGM,” PSX Company Secretary Muhammad Rafique Umer said in a notice.
Earlier, 11 candidates had submitted documents to contest the election on seven seats.
SECP and PSX were engaged in a struggle over the bourse’s board of directors’ election. On Dec 29, SECP issued a directive to PSX to hold elections for the new board by February 28. But due to opposition from broker directors, together with some independent directors, the process was thrown into chaos.
During February it was reported that PSX board had refused to hold elections as per SECP directives insisting that its three-year term will end in February 2019.
After the conclusion of demutualization, the law required the reconstitution of the PSX board. And since demutualization concluded in June 2017, when 20 percent shares were divested to the public, it was critical to have the representation of these minority shareholders on the bourse’s board, said the SECP.
The minority shareholders were being denied their due legitimate right. This had become a serious issue to the extent that Adviser to Prime Minister on Finance, Miftah Ismail, had to intervene last month.
He 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.
Muhammad Rafique Umer, Company Secretary PSX, said that the bourse would soon select another fourteen candidates from which the apex regulator would choose seven as its approved independent directors on the bourse’s board.
The board will have a total 15 directors including PSX Managing Director Richard Morin.
The formation of the new board will be completed in the first week of May.