In an effort to strengthen the supervision of listed companies, the SECP has decided to make the onsite inspection a more regular and frequent feature in addition to offsite supervision and adjudication of listed companies.
A specialized inspection wing has been set up for this purpose and it has started working. The objective of inspections is more of a fact finding exercise rather than to penalize companies.
It will scrutinize operational status, financial position and quality of assets of listed companies especially non-operational companies and the companies under process of reviving their operations.
Moreover, cohesive risk profiling exercise of listed companies has been strengthened in order to streamline supervision of companies based on indicators such as return to shareholders, financial results, compliance history, presence on defaulters’ counter and transaction with related parties. The department has initiated 94 show cause proceedings against companies related to various non-compliance with legal requirements regarding auditors’ reports, directors’ powers, holding of annual general meetings, investment in associated companies, circulation of financial statements, treatment of surplus on revaluation of fixed assets and security deposits etc. during December and January, whereas 71 proceedings were concluded through orders during these two months.
The department has also finalized plans to hold three awareness sessions about Principles of Corporate Governance for Non Listed Companies (Principles) in Karachi, Lahore and Islamabad in co-operation with the International Finance Corporation (IFC) and Centre for International Private Enterprise (CIPE).
The first session will be held next month in Karachi.—Agencies